Sr. No.

Relevant Act/
Regulations/Schemes
Legal Provisions Remarks
1 Employee Provident
Funds and
miscellaneous Act,
19!
Section 1"A states
(1) every person who at the time the
offence was committed was in charge of,
and was responsible to, the company for the
conduct of the business of the company, as
well as the company, shall be deemed to be
guilty of the offence and shall be liable to
be proceeded against and punished
accordingly.
(2) Notwithstanding anything contained in
sub-section (1), where an offence under this
ct have been committed by a company and
it is proved that the offence has been
committed with the consent or connivance
of or is attributable to any neglect on the
part of, any director, manager, secretary or
other officer of the company, such
director, manager, secretary or other
officer of the company shall also be
deemed to be guilty of that offence and shall
be liable to be proceeded against and
punished accordingly.!
Section 1" states
In case an employer
contravenes with the
provision of the act he
shall be punishable
with imprisonment for
a term which may
extend to three years
but which shall not be
less than one year and
fine of ten thousand
rupees in case of
default in payment of
the employees'
contribution which has
been deducted by the
employer from the
employees' wages
2 #he Employee$s
%eposit Linked
&nsurance Scheme,
19'(
Section )A states
where an employer ma"es default in the
payment of any contribution to the #nsurance
$und, or in the payment of any charges payable
under any other provision of the ct (%mployee
&rovident $unds and miscellaneous ct, 1'(2)
Section )A prescribes
the rate of recovering.
Period o* de*ault+
Rate o* damages
Less than 2 months
1!"
2 months or more
22"
# months or more
or of the )cheme, the *entral &rovident $und
*ommissioner or such officer as may be
authori+ed by the *entral ,overnment, by
notification in the -fficial ,a+ette, in this
behalf, may recover from the employer by way
of penalty, damages at the rates given.!
2!"
$ months or more
%!"
&lso Section !9 states
if found guilty of non
compliance of
provisions of scheme
then the person shall be
punishable with
imprisonment which
may extend to one year
or with fine which may
extend to four thousand
rupees' or with both.
% Employees, State
&nsurance Act, 19")
Section )- states
(.here an employer fails to pay the amount
due in respect of any contribution or any other
amount payable under this ct, the *orporation
(%mployees/ )tate #nsurance *orporation) may
recover from the employer by way of penalty
such damages not e0ceeding the amount of
arrears as may be specified in the regulations.!
Section )(A of the same act states
(1) if the person committing an offence under
this ct is a company, every person, who at the
time the offence was committed was in charge
of, and was responsible to, the company for the
conduct of the business of the company, as well
as the company, shall be deemed to be guilty of
the offence and shall be liable to be proceeded
against and punished accordingly.
(2) Notwithstanding anything contained in sub-
section (1), where an offence under this ct
have been committed by a company and it is
proved that the offence has been committed
Section ) states If any
person )a*fails to pay
any contribution for the
fund or )b*non
complies with
provisions of the act he
shall be punishable
with imprisonment for
a term which may
extend to three
years but not less than
one year if he fails to
pay the deducted
contribution of
employee and not less
than $ months in any
other case for clause )a*
&nd imprisonment for a
term which may extend
to one year or with fine
which may extend to
four thousand rupees'
or with both for clause
)b*.
with the consent or connivance of or is
attributable to any neglect on the part of, any
director, manager, secretary or other officer of
the company, such director, manager,
secretary or other officer of the company shall
also be deemed to be guilty of that offence and
shall be liable to be proceeded against and
punished accordingly.!
# Employees, Provident
Funds Scheme, 19!
Section .!A states
.here a employer ma"es default in the
payment of any contribution to the $und, or in
the transfer of accumulations re1uired to be
transferred by him under sub-section (2) of
)ection 1( or sub-section (1() of )ection 12 of
the ct or in the payment of any charges
payable under any other provisions of the ct
or the )cheme or under any of the conditions
specified under )ection 12 of the ct, the
*entral &rovident $und *ommissioner or such
officer as may be authori+ed by the *entral
,overnment by notification in the -fficial
,a+ette in this behalf, may recover from the
employer by way of penalty.!
Section .!A prescribes
the rates for penalty
are+
Period o* de*ault+
Rate o* damages
Less than 2 months
,"
2 months or more
1-"
# months or more
1,"
$ months or more
2,"
&lso section '( states
if found guilty of non
compliance of
provisions of scheme
then the person shall be
punishable with
imprisonment which
may extend to one year
or with fine which may
extend to four thousand
rupees' or with both.
, Payment o* -onus
Act, 19(
Section !9 states
(1) #f the person committing an offence under
this ct is a company, every, person who, at
the time the offence was committed, was in
charge of, and was responsible to, the
company for the conduct of business of the
company, as well as the company, shall be
Section !) states If a
person contravenes any
provision of the act he
shall be punishable
with imprisonment for
a term which may
extend to six months' or
with fine which may
extend to one thousand
rupees' or with both.
deemed to be guilty of the offence and shall be
liable to be proceeded against and punished
accordingly.
(2) Notwithstanding anything contained in
sub-section (1), where an offence under this
ct have been committed by a company and it
is proved that the offence has been committed
with the consent or connivance of or is
attributable to any neglect on the part of, any
director, manager, secretary or other officer
of the company, such director, manager,
secretary or other officer of the company
shall also be deemed to be guilty of that
offence and shall be liable to be proceeded
against and punished accordingly.!
$ Payment o* /ratuity
Act, 19'!
Section ) states+
if the amount of gratuity payable under
this ct is not paid by the employer, within
the prescribed time, to the person entitled
thereto, the controlling authority shall, on
an application made to it in this behalf by
the aggrieved person, issue a certificate for
that amount to the *ollector who shall
recover the same, together with compound
interest thereon

3at such rate as the *entral
,overnment may, by notification, specify4,
from the date of e0piry of the prescribed
time as arrears of land revenue and pay the
same to the person entitled thereto.!
Section 90!1 states
&n employer who
contravenes' or ma.e
default in complying
with' any of the
provisions of this &ct
or any rule or order
made there under shall
be punishable with
imprisonment for a
term

which shall not be
less than three months
but which may extend
to one year' or with fine
which shall not be less
than ten thousand
rupees but which may
extend to twenty
thousand rupees.
! Payment o* 2ages
Act, 19.)
Section . states
%very employer shall be responsible for
Section !! states &ny
employer contravening
the payment of all wages re1uired to be
paid under this ct to persons employed by
him and in case of persons employed,--
(a) in factories, if a person has been
named as the manager of the factory under
clause (f) of sub-section (1)of section 2 of
the $actories ct, 1'567
(e) in any other case, a person designated
by the employer as a person responsible
for complying with the provisions of the
ct.!
sections of the act shall
be punishable with a
fine of not less than ,--
rupees and extending
!--- rupees.
/ 3inimum 2ages Act,
19")
Section !!4 states
(1) if the person committing any offence
under this ct is a company, every person
who at the time the offence was committed,
was in charge of, and was responsible to,
the company for the conduct of the business
of the company as well as the company
shall be deemed to be guilty of the offence
and shall be liable to be proceeded against
and punished accordingly.
(2) Notwithstanding anything contained in
sub-section (1), where an offence under this
ct have been committed by a company and
it is proved that the offence has been
committed with the consent or connivance
of or is attributable to any neglect on the
part of, any director, manager, secretary or
other officer of the company, such
Section !! states that
failing to pay
minimum wage by
employer will attract
imprisonment for a
term not extending $
months and a fine not
extending ,--- rupees.
director, manager, secretary or other
officer of the company shall also be
deemed to be guilty of that offence and shall
be liable to be proceeded against and
punished accordingly.
0 3aternity -ene*its
Act, 19(1
Section states+
)ub8ect to the provisions of this ct, every
woman shall be entitled to, and her
employer shall be liable for, the payment of
maternity benefit at the rate of the average
daily wage for the period of her actual
absence, that is to say, the period
immediately preceding and including the
day of her delivery, the actual day of her
delivery and any period immediately
following that day.4
Section !1 states that
if any employer fails to
pay any amount of
maternity benefit to a
woman entitled under
this &ct or discharges
or dismisses such
woman during or on
account of her absence
from wor. in
accordance with the
provisions of this &ct'
he shall be punishable
with imprisonment
which shall not be less
than three months but
which may extend to
one year and with fine
which shall not be less
than two thousand
rupees but which may
extend to five
thousand rupees.
1- #he Factories Act,
19")
Section !0n1 0ii1 states
occupier of a factory means the person
who has ultimate control over the affairs of
the factory.!
1his section can be
used by directors of
company under
various
abovementioned act in
which person
responsible for
conducting business is
to be punished for the
offences committed by
a company.
11 #he &ndian &ncome
#a5 Act, 19(1
Section 1'9 states+
Section !61 states
Notwithstanding anything contained in
the *ompanies ct, 1'(9 (1 of 1'(9),
where any ta0 due from a private company
in respect of any income of any previous
year or from any other company in respect
of any income of any previous year during
which such other company was a private
company cannot be recovered, then, every
person who was a director of the private
company at any time during the relevant
previous year shall be 8ointly and severally
liable for the payment of such ta0 unless he
proves that the non-recovery cannot be
attributed to any gross neglect,
misfeasance or breach of duty on his part
in relation to the affairs of the company.!
2or this purpose 3rincipal 4fficer is
defined in section !0.* which states
:principal officer:, used with reference to a
local authority or a company or any other
public body or any association of persons
or any body of individuals, means -
(a) the secretary, treasurer, manager or
agent of the authority, company,
association or body, or
(b) any person connected with the
management or administration of the
local authority, company, association or
body upon whom the Assessing Officer
has served a notice of his intention of
5here any person'
including the principal
officer of a company'
)b* referred to in
subsection )1&* of
section 102' being an
employer' does not
deduct' or does not
pay' or after so
deducting fails to
pay' the whole or any
part of the tax' as
re6uired by or under
this &ct' then' such
person' shall'
without pre7udice to
any other
conse6uences which
he may incur' be
deemed to be an
assessee in default in
respect of such tax.
(1A) 5ithout
pre7udice to the
provisions of sub
section )1*' if any
such person'
principal officer or
company as is
referred to in that
subsection does not
deduct the whole or
any part of the tax or
after deducting fails
to pay the tax as
re6uired by or under
this &ct' he or it shall
be liable to pay
simple interest'
)i* at one per cent.
for every month or
part of a month on
the amount of such
treating him as the principal officer
thereof ;
Section !'14 states+
#f any person fails to ;
(a) deduct the whole or any part of the ta0
as re1uired by or under the provisions of
*hapter <=##> 7 or
(b) pay the whole or any part of the ta0 as
re1uired by or under, ;
(i) sub-section (2) of section 11(-- 7 or
(ii) second proviso to section 1'5>, then,
such person shall be liable to pay, by way
of penalty, a sum e1ual to the amount of
ta0 which such person failed to deduct or
pay as aforesaid.
(2) ny penalty imposable under sub-
section (1) shall be imposed by the
1
3?oint
*ommissioner4!
tax from the date on
which such tax was
deductible to the date
on which such tax is
deducted8 and
)ii* at one and one+
hal* per cent. for
every month or part
of a month on the
amount of such tax
from the date on
which such tax was
deducted to the date
on which such tax is
actually paid' and
such interest shall be
paid before
furnishing the
statement in
accordance with the
provisions of sub
section )%* of section
2--.9
7FF&4ER &8 %EFA9L#
Section 2)$-* of the :ompanies &ct' 2-1% defines who is an officer in default. 1he
bare letter of the section states+
:officer who is in default:, for the purpose of any provision in this ct which enacts that an
officer of the company who is in default shall be liable to any penalty or punishment by way
of imprisonment, fine or otherwise, means any of the following officers of a company,
namely@--
(i) whole-time director7
(ii) key managerial personnel7
(iii) where there is no "ey managerial personnel, such director or directors as specified by
the Board in this behalf and who has or have given his or their consent in writing to the
>oard to such specification, or all the directors, if no director is so specified7
(iv) any person who, under the immediate authority of the Board or any key managerial
personnel, is charged with any responsibility including maintenance, filing or distribution
of accounts or records, authori+es, actively participates in, "nowingly permits, or "nowingly
fails to ta"e active steps to prevent, any default7
(v) any person in accordance with whose advice, directions or instructions the Board of
Directors of the company is accustomed to act, other than a person who gives advice to the
>oard in a professional capacity7
(vi) every director, in respect of a contravention of any of the provisions of this ct, who is
aware of such contravention by virtue of the receipt by him of any proceedings of the >oard
or participation in such proceedings without ob8ecting to the same, or where such
contravention had ta"en place with his consent or connivance7
(vii) in respect of the issue or transfer of any shares of a company, the share transfer agents,
registrars and merchant bankers to the issue or transfer7