intelligent doubts

sec 447 of which act ?

😂😂 We are in company law app. 447 of company act. Second proviso of section 447

Ok got your query.
The law says that if a person has made Fraud of Rs. 10 Lakhs or 1% of turnover, whichever is lower, then he shall be punishable for fraud u/s 447 of companies act.

Let me help you with an example :

Scenario 1 :
Fraud amount: 1Lakh
Turnover of company : 90Lakh
1% of turnover : 90,000
in this case he shall be punishable u/s 447 as he has done fraud of more than 90,000.

Scenario 2 :
Fraud amount: 1Lakh
Turnover of company : 2 crore
1% of turnover : 2,00,000
in this case he shall NOT be punishable u/s 447 as he has done fraud of less than 2,00,000 and less than 10 Lakh.

Scenario 3 :
Fraud amount: 11 Lakh
Turnover of company : 12 crore
1% of turnover : 12,00,000
in this case he shall be punishable u/s 447 as he has done fraud of more than 10,00,000.


Scenario 4 :
Fraud amount: 5,000
Turnover of company : 0
1% of turnover : 0
in this case he shall be punishable u/s 447 as he has done fraud of more than 0 in this case.

First Bro understand section then proviso.
Section says that the amount of froud is MORE THAN 10lakh or 1% of t/O. WHICH EVER IS LOWER. Than big penalty impose for FROUD. FOR example 10 lakh or 1% is 90, 000 then the penalty imposed because of 90,000 amount of froud (whichever is lower) big penalty. (section penalty)

NOW see what about LESS THAN 10 lakh or 1% of t/o. Now moove on proviso if froud involved less than 90,000 then proviso's penalty impose.

Both Penalty are different
One is for more than 10 lakh or 1% which ever is lower.
Second is for lower of above. (section 's penalty imposition amount.)

Yes, correct.
Different quantum of penalty is specified for different scenario in the same section.

Actual forud amount and sectio/proviso amount compared than impose penalty. 👍