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

Which of the following entities is within the class of companies to which the lesser penalty under section 446B applies?

A private company recognised as a start-up under the notification of the Department for Promotion of Industry and Internal Trade is covered. Section 446B applies to One Person Companies, small companies, start-up companies and Producer Companies, not to listed or foreign companies.

  1. AA listed public company with small shareholders
  2. BA public company with Rs 10 crore turnover
  3. CA private company recognised as a start-up under the DPIIT notificationCorrect
  4. DA foreign company with a place of business in India

Explanation

Section 446B covers a One Person Company, small company, start-up company or Producer Company. A start-up company is a private company recognised as such under the DPIIT notification. The other entities are not in this list.

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