CS Professional · Compliance Management, Audit and Due Diligence · Non-Compliances, Penalties and Adjudications
Meridian Infra Ltd's director committed an offence punishable with imprisonment and also with fine. The company has applied to the Tribunal and offers to pay the maximum fine. Separately, another offence by the company is punishable with fine only, but an investigation against the company under the Act is pending. Which statement is correct?
The first offence is not compoundable because it is punishable with imprisonment and also fine, and the second cannot be compounded while an investigation against the company is pending. Section 441 bars both, and offering the maximum fine does not change that.
- ABoth offences may be compounded if the maximum fine is paid
- BThe first is compoundable by the Tribunal, the second is not
- CThe first is not compoundable, and the second cannot be compounded while the investigation is pendingCorrect
- DThe first is compoundable by the Regional Director, the second by the Tribunal
Explanation
Section 441(6) says an offence punishable with imprisonment only, or with imprisonment and also with fine, is not compoundable. The third proviso to section 441(1) bars compounding of offences by a company or officer if an investigation against the company has been initiated or is pending. Paying a higher fine cannot override either bar.
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