Companies Act, 1956
Section - 371 - Penalty for contravention of section 370 or 370A
Penalty for contravention of [[***] section or ].371. (1) Every person who is a party to any contravention of [[***] [excluding sub-section (1C) or (1D)], or ], including in particular any person to whom the loan is made, or in whose interest the guarantee is given or the security is provided, shall be punishable with fine which may extend to [fifty] thousand rupees or with simple imprisonment for a term which may extend to six months :Provided that where any such loan, or any loan in connection with which any such guarantee or security has been given or provided by the lending company, has been repaid in full, no punishment by way of imprisonment shall be imposed under this sub-section; and where the loan has been repaid in part, the maximum punishment which may be imposed under this sub-section by way of imprisonment shall be proportionately reduced.
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