Section 76A: Punishment for contravention of section 73 or section 76

Companies Act, 2013 · Chapter V: Acceptance Of Deposits By Companies · In force

This section is for punishing companies and their officers who break the rules about accepting and repaying deposits.

Penalty

(a) the company shall, in addition to the payment of the amount of deposit or part thereof and the interest due, be punishable with fine which shall not be less than 2[one crore rupees or twice the amount of deposit accepted by the company, whichever is lower] but which may extend to ten crore rupees; and

(b) every officer of the company who is in default shall be punishable with imprisonment which may extend to 3[seven years and with fine] which shall not be less than twenty-five lakh rupees but which may extend to two crore rupees, 4***: Provided that if it is proved that the officer of the company who is in default, has contravened such provisions knowingly or wilfully with the intention to deceive the company or its shareholders or depositors or creditors or tax authorities, he shall be liable for action under section 447.]

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What the section says

In plain terms

Where a company accepts or invites or allows or causes any other person to accept or invite on its behalf any deposit in contravention of the manner or the conditions prescribed under section 73 or section 76 or rules made thereunder or if a company fails to repay the deposit or part thereof or any interest due thereon within the time specified under section 73 or section 76 or rules made thereunder or such further time as may be allowed by the Tribunal under section73,—

(a)the company shall, in addition to the payment of the amount of deposit or part thereof and the interest due, be punishable with fine which shall not be less than 2[one crore rupees or twice the amount of deposit accepted by the company, whichever is lower] but which may extend to ten crore rupees; and

(b)every officer of the company who is in default shall be punishable with imprisonment which may extend to 3[seven years and with fine] which shall not be less than twenty-five lakh rupees but which may extend to two crore rupees, 4***: Provided that if it is proved that the officer of the company who is in default, has contravened such provisions knowingly or wilfully with the intention to deceive the company or its shareholders or depositors or creditors or tax authorities, he shall be liable for action under section 447.]

CHAPTER VI REGISTRATION OF CHARGES

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 21 of 2015, s. 8 (w.e.f. 29-5-2015).
2. Subs. by Act 1 of 2018, s. 17, for “one crore rupees” (w.e.f. 9-2-2018).
3. Subs. by s. 17, ibid., for “seven years or with fine” (w.e.f. 9-2-2018).
4. The words “or with both” omitted by s. 17, ibid. (w.e.f. 9-2-2018).
5. Subs. by Act 22 of 2019, s. 11, for first and second provisos (w.e.f. 2-11-2018).

This section refers to

s. 73 Prohibition on acceptance of deposits from public s. 76 Acceptance of deposits from public by certain companies s. 447 Punishment for fraud

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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.