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CMA Final · Corporate and Economic Laws · Inspection, Inquiry and Investigation

During an investigation, an officer of a company under investigation unauthorisedly removes documents relating to the company's assets. Which statement correctly states the consequence under the Act?

The officer is punishable for fraud as provided in section 447. Section 229 covers unauthorised removal as well as destruction, mutilation, falsification, concealment or tampering of documents about the company's property, assets or affairs, so destruction is not necessary for liability.

  1. AHe is punishable for fraud in the manner provided in section 447Correct
  2. BHe is liable only to a fine of Rs 25,000 under the section on inspection
  3. CHe is liable only to disqualification as a director
  4. DNo liability arises unless the documents are destroyed

Explanation

Section 229 covers destroying, mutilating, falsifying, concealing, tampering or unauthorisedly removing documents, and the person is punishable for fraud under section 447. Removal alone suffices, so the last option is wrong.

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