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Section 337 Of The Companies Act 2013: Penalty For Frauds By Officers

SECTION-337 (Penalty for frauds by officers) under CHAPTER-XX (Winding Up) of the Companies Act, 2013

If any person, being at the time of the commission of the alleged offence an officer of a company which is subsequently ordered to be wound up by the Tribunal under this Act,—
(a) has, by false pretences or by means of any other fraud, induced any person to give credit to the company;
(b) with intent to defraud creditors of the company or any other person, has made or caused to be made any gift or transfer of, or charge on, or has caused or connived at the levying of any execution against, the property of the company; or
(c) with intent to defraud creditors of the company, has concealed or removed any part of the property of the company since the date of any unsatisfied judgment or order for payment of money obtained against the company or within two months before that date,
he shall be punishable with imprisonment for a term which shall not be less than one year but which may extend to three years and with fine which shall not be less than one lakh rupees but which may extend to three lakh rupees.







Extra Notes for Readers

(1) The Companies Act, 2013 received the assent of the President on the 29th August, 2013 (Published in the Gazette of India, Extraordinary, Part II - Section 1 by Ministry of Law and Justice, Legislative Department on 30th August, 2013) - link


(2) Section 337 of the Companies Act 2013 was notified by MCA Notification S.O. 3677(E) dated 7th December 2016 (w.e.f. 15th December 2016) - link

(3) Section 337 of the Companies Act 2013 was notified (to the extent of their applicability for section 246) by MCA Notification S.O. 2912(E) dated 9th September, 2016 - link

(4) The Companies (Winding Up) Rules, 2013 is yet to be notified.


(5) Section 337 of the Companies Act 2013 was modified in accordance with the section 255 of the Insolvency and Bankruptcy Code, 2016 - link.
In section 337, for the words "or which subsequently passes a resolution for voluntary winding up,", the words "under this Act", shall be substituted.

MCA has notified section 255 of the Insolvency and Bankruptcy Code, 2016 vide notification no. S.O. 3453(E) dated 15th November 2016 (w.e.f. 15th November 2016) - link







This page was last updated on 6th May, 2017.

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