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CMA Final · Corporate and Economic Laws · Specific Legal Provisions related to MSME Sector

Under section 27(1) of the MSMED Act, 2006, a person is convicted a second time for intentionally contravening section 8(1). Which statement about the punishment is correct?

On a second or subsequent conviction for intentionally contravening section 8(1), the fine shall not be less than rupees one thousand but may extend to rupees ten thousand, as stated in section 27(1)(b). The first conviction carries a fine up to rupees one thousand.

  1. AFine up to rupees one thousand only
  2. BFine of at least rupees one thousand but up to rupees ten thousandCorrect
  3. CFine of at least rupees ten thousand with no upper limit
  4. DFine of up to rupees ten thousand with no minimum

Explanation

For a second or subsequent conviction, section 27(1)(b) prescribes a fine not less than rupees one thousand but extending to rupees ten thousand. The cap of one thousand applies only to the first conviction. The minimum of ten thousand with no limit applies to a buyer under section 22.

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