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CS Professional · Corporate Restructuring, Valuation and Insolvency · Cross Border Mergers

Assume a rule under the Companies Act, 2013 on cross-border mergers provides that its contravention is punishable under section 469(3). A company contravenes the rule and the contravention continues for 10 days in all, counting the first day. What is the maximum fine?

The maximum fine is Rs 9,500. Section 469(3) allows up to Rs 5,000 for the contravention and a further Rs 500 for every day after the first. With 10 days of continuing contravention, nine extra days add Rs 4,500 to the Rs 5,000.

  1. ARs 5,000 only
  2. BRs 9,500Correct
  3. CRs 4,500
  4. DRs 10,000

Explanation

Under section 469(3) the fine may extend to Rs 5,000, plus a further fine up to Rs 500 for every day after the first. For 10 days, the days after the first are 9, so 9 x 500 = 4,500. Total = 5,000 + 4,500 = 9,500. Rs 10,000 wrongly counts 10 additional days.

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