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CS Executive · Economic, Commercial and Intellectual Property Laws · Overseas Direct Investment

Rohan Mehta is found to have acquired foreign security situated outside India, of aggregate value exceeding the threshold prescribed under the proviso to Section 37A(1). Which combination of consequences does Section 13 provide?

The person faces a penalty up to three times the sum involved plus confiscation of equivalent value in India, and also imprisonment up to five years with fine. Courts can take cognizance only on a written complaint by an officer not below Assistant Director.

  1. AOnly a penalty up to Rs 2 lakh
  2. BPenalty up to three times the sum involved and confiscation of equivalent value in India; additionally imprisonment up to five years and fine, with cognizance only on a written complaint by an officer not below Assistant DirectorCorrect
  3. COnly confiscation, with no penalty or imprisonment
  4. DImprisonment up to five years, with cognizance by any court on a private complaint

Explanation

Section 13(1A) gives a penalty up to three times the sum involved and confiscation of equivalent value in India. Section 13(1C) adds imprisonment up to five years and fine. Section 13(1D) bars cognizance except on a written complaint by an officer not below Assistant Director, so private complaints are not allowed.

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