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

Meridian Pharma Ltd was directed by an adjudicating officer to pay a penalty and rectify a default. The company did nothing for 100 days after receiving the copy of the order and filed no appeal. Its officer in default, Mr Rao, also did not comply. Which consequence is correct under section 454(8)?

After ninety days of non-compliance with the order, the company is punishable with a fine of twenty-five thousand to five lakh rupees. The officer in default is punishable with imprisonment up to six months, or a fine of twenty-five thousand to one lakh rupees, or both.

  1. AThe company faces a fine of at least twenty-five thousand rupees extending to five lakh rupees; Mr Rao faces imprisonment up to six months or a fine of at least twenty-five thousand rupees up to one lakh rupees, or bothCorrect
  2. BOnly the company is liable, with a fine up to one lakh rupees; the officer faces no consequence
  3. CThe company faces a fine of at least one lakh rupees up to ten lakh rupees; Mr Rao faces imprisonment up to three years
  4. DNeither is liable until the Regional Director confirms the order

Explanation

Failure to comply with the order within ninety days of receipt attracts, for the company, a fine of not less than 25,000 and up to five lakh rupees. The officer in default faces imprisonment up to six months or a fine of 25,000 to one lakh rupees, or both. Confirmation by the Regional Director is not a precondition when no appeal is filed.

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