Section 342: Prosecution of delinquent officers and members of company
This section is for prosecuting officers and members of a company who have committed offences related to the company during a winding up process.
The section, clause by clause
What the section says
In plain terms
(1)If it appears to the Tribunal in the course of a winding up by the Tribunal, that any person, who is or has been an officer, or any member, of the company has been guilty of any offence in relation to the company, the Tribunal may, either on the application of any person interested in the winding up or suo motu, direct the liquidator to prosecute the offender or to refer the matter to the Registrar. 1*
The Tribunal can direct the liquidator to prosecute someone who has committed an offence related to the company, or refer the matter to the Registrar, during a winding up process.
(5)When any prosecution is instituted under this section, it shall be the duty of the liquidator and of every person, who is or has been an officer and agent of the company to give all assistance in connection with the prosecution which he is reasonably able to give.
When a prosecution is started under this section, the liquidator and any officer, agent, or former officer or agent of the company must give all reasonable assistance with the prosecution.
explanationExplanation.—For the purposes of this sub-section, the expression “agent”, in relation to a company, shall include any banker or legal adviser of the company and any person employed by the company as auditor. 2*
The right-hand column is written from the section text, not quoted from it, and it has no legal force. Where the two differ, the left-hand column is the law.
Amendment notes
- 1. Sub-sections (2), (3) and (4) omitted by Act 31 of 2016, s. 255 and the Eleventh Schedule (w.e.f. 15-11-2016).
- 2. Sub-section (6) omitted by Act 29 of 2020, s. 48 (w.e.f. 21-12-2020).
- 3. Subs. by Act 31 of 2016, s. 255 and the Eleventh Schedule, for sub-section (1) (w.e.f. 15-11-2016).
Referred to by
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Reproduced from the official India Code print for reference. Check the current text on India Code before you rely on it, and read the section alongside its Rules. Nothing here is legal advice.