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CS Professional · Compliance Management, Audit and Due Diligence · Relief and Remedies

Mr. Sameer Joshi, an officer of Lotus Pharma Ltd, faces a criminal proceeding for breach of duty, and the company also has a civil claim for the loss arising from the same breach. The court finds he acted honestly and reasonably and ought fairly to be excused. Which statement is correct under Section 463(1)?

In the criminal proceeding the court may grant relief, but it cannot relieve him from civil liability for the same breach. The proviso to Section 463(1) expressly denies a criminal court that power, so the company's civil claim remains unaffected.

  1. AIn the criminal proceeding, the court may also wipe out his civil liability for the same breach
  2. BThe court may grant relief in the criminal proceeding, but it has no power there to grant relief from any civil liability attaching to him for that breachCorrect
  3. CNo relief of any kind is possible once a criminal proceeding has begun
  4. DRelief from civil liability is possible only if the Registrar agrees in the criminal proceeding

Explanation

The proviso to Section 463(1) says that in a criminal proceeding under the sub-section, the court has no power to grant relief from any civil liability that may attach to the officer. So relief in the criminal case does not extinguish the civil claim. The suggestion that civil liability can be wiped out contradicts the proviso, and criminal proceedings are not excluded from the section.

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