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CS Professional · Compliance Management, Audit and Due Diligence · Compliance Framework

Lotus Retail Ltd, an unlisted public company, defaults in complying with section 134 by not attaching the required Board's report. What is the consequence stated in section 134(8)?

Under section 134(8), the company is liable to a penalty of three lakh rupees and every officer in default to a penalty of fifty thousand rupees. The section provides monetary penalties and does not prescribe imprisonment for this default.

  1. APenalty of three lakh rupees on the company and fifty thousand rupees on every officer in defaultCorrect
  2. BPenalty of fifty thousand rupees on the company only
  3. CImprisonment of officers in default for one year
  4. DNo penalty, as it is only a procedural lapse

Explanation

Section 134(8) as substituted in 2020 imposes a penalty of three lakh rupees on the company and fifty thousand rupees on every officer who is in default. It provides a monetary penalty and no imprisonment.

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