Section 172 of the Companies Act, 2013
Section 172 of the Companies Act, 2013
– Punishment for contravention of provisions of Chapter XI (Appointment and Qualifications of Directors)
📜 Bare Act Text (Simplified):
If a company or any officer of a company contravenes any provision of Chapter XI (which covers Sections 149 to 172, relating to appointment and qualifications of directors), and no specific punishment is provided for such contravention,
➡️ Then the company and every officer who is in default shall be liable to a penalty of ₹50,000.
➡️ In case of continuing contravention, there will be a further penalty of ₹500 per day, subject to a maximum of ₹3 lakh.
✅ Key Points / Summary:
| Particular | Details |
|---|---|
| Applies to | Contraventions of Chapter XI where no specific penalty is prescribed. |
| Who is liable? | The company and officer in default. |
| Initial penalty | ₹50,000 (one-time). |
| Continuing default penalty | ₹500 per day (max ₹3,00,000). |
📌 Example:
Suppose a company fails to comply with Section 164 (disqualification of directors), and no specific punishment is provided for that default:
The company and each responsible officer will be liable to a penalty of ₹50,000.
If the default continues, ₹500 per day will be added, up to ₹3,00,000 maximum.
RELATED Blog
0 comments