Section 365 of the Companies Act, 2013
Section 365 of the Companies Act, 2013
Title: "Penalty for fraudulent application for removal of name."
Status: ✅ This section is in force.
🔍 Provision Summary:
Section 365 deals with penalties imposed on persons who fraudulently apply for the removal of a company's name from the register of companies.
📝 Bare Act (Simplified Explanation):
If an application is made under Section 363 (which deals with removal of name of LLP from register) or under relevant provisions, and it's found that:
The application was made with the intent to deceive, or
There was a fraudulent motive (such as avoiding liability or hiding wrongdoing),
then the person responsible shall be:
🔸 Punished with imprisonment for a term which may extend to 2 years,
🔸 Or with fine which may extend to ₹1 lakh,
🔸 Or with both.
🧾 Objective:
To prevent misuse of the fast-track exit or name removal process by persons attempting to avoid legal responsibilities such as:
Paying debts
Facing investigation
Complying with statutory requirements
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