Section 36: Punishment for fraudulently inducing persons to invest money
This section is for punishing individuals who fraudulently induce people to invest money by making false statements or concealing important facts.
The section, clause by clause
What the section says
In plain terms
Any person who, either knowingly or recklessly makes any statement, promise or forecast which is false, deceptive or misleading, or deliberately conceals any material facts, to induce another person to enter into, or to offer to enter into,—
(a)any agreement for, or with a view to, acquiring, disposing of, subscribing for, or underwriting securities; or
(b)any agreement, the purpose or the pretended purpose of which is to secure a profit to any of the parties from the yield of securities or by reference to fluctuations in the value of securities; or
(c)any agreement for, or with a view to obtaining credit facilities from any bank or financial institution, shall be liable for action under section 447.
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. Ins. by Act 1 of 2018, s. 9 (w.e.f. 9-2-2018).
- 2. Subs. by Act 22 of 2019, s. 8, for “delivery of a copy of the prospectus for registration” (w.e.f. 15-8-2019).
This section refers to
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.