Skip to content

CMA Intermediate · Business Laws and Ethics · The Code on Wages, 2019

Rohan Foods Pvt Ltd was convicted for paying an employee less than the amount due. Three years later it is again found guilty of a similar offence of underpayment. Which punishment can the court impose for this second offence under the Code on Wages, 2019?

A repeat underpayment offence within five years is punishable with imprisonment up to three months or fine up to Rs 1 lakh, or both. The first-offence fine of Rs 50,000 and the one-month or Rs 40,000 penalty for other contraventions do not apply here.

  1. AFine up to Rs 50,000 only
  2. BImprisonment up to three months or fine up to Rs 1 lakh, or bothCorrect
  3. CImprisonment up to one month or fine up to Rs 40,000, or both
  4. DFine up to Rs 20,000 only

Explanation

Under section 54(1)(b), a repeat underpayment offence within five years is punishable with imprisonment up to three months or fine up to Rs 1 lakh, or both. Rs 50,000 fine is the first-offence penalty for underpayment. The one-month/Rs 40,000 option is the repeat penalty for contravention of other provisions under clause (d).

Did you get it right without looking?

One question tells you little. A timed set on The Code on Wages, 2019 shows your real accuracy, how long you take and where you lose marks.

Practise The Code on Wages, 2019Free diagnostic mock

More The Code on Wages, 2019 questions