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CS Professional · Compliance Management, Audit and Due Diligence · Non-Compliances, Penalties and Adjudications

An adjudicating officer ordered Orion Pharma Ltd and its company secretary (an officer in default) to rectify a default and pay penalty. Neither complied within ninety days of receiving the order copy. Which consequence follows under the adjudication provision?

The company faces a fine of Rs 25,000 to Rs 5 lakh. The officer in default faces imprisonment up to six months, or a fine of Rs 25,000 to Rs 1 lakh, or both, for failing to comply with the order within ninety days of receipt.

  1. ACompany fine of Rs 25,000 to Rs 5 lakh; officer imprisonment up to six months or fine of Rs 25,000 to Rs 1 lakh, or bothCorrect
  2. BCompany fine of Rs 25,000 to Rs 1 lakh; officer imprisonment up to one year or fine up to Rs 5 lakh
  3. CCompany fine of Rs 25,000 to Rs 5 lakh; officer only fine of Rs 25,000 to Rs 1 lakh, no imprisonment
  4. DCompany and officer both face only the original penalty doubled

Explanation

Failure to comply with the order within ninety days makes the company punishable with fine of at least Rs 25,000 extending to Rs 5 lakh. The officer in default is punishable with imprisonment up to six months or fine of Rs 25,000 to Rs 1 lakh, or both. Imprisonment is therefore available, so the no-imprisonment option is wrong.

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