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

Meera Traders Limited is being wound up voluntarily. Its business letters issued during winding up omit any statement that the company is being wound up. Who is liable and to what extent?

The company and every officer, liquidator, receiver or manager who wilfully authorises or permits the omission are punishable with fine of not less than Rs 50,000 extending to Rs 3 lakh. The duty applies to both voluntary and Tribunal winding up.

  1. AOnly the company, with fine up to Rs 10,000
  2. BThe company and every officer, liquidator, receiver or manager who wilfully authorises or permits it, with fine of Rs 50,000 to Rs 3 lakhCorrect
  3. COnly the liquidator, with imprisonment up to six months
  4. DNo one, as the requirement covers only winding up by the Tribunal

Explanation

Section 344 applies whether the company is wound up by the Tribunal or voluntarily, and requires business letters, invoices and orders to carry the statement. For contravention, the company and every officer, liquidator, receiver or manager who wilfully authorises or permits it face fine of Rs 50,000 to Rs 3 lakh.

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