(1) Where an offence under this Act has been committed by 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:
Provided that nothing contained in this sub-section shall render any such person liable to any punishment if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has 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 shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
1 (3) Where an offence under this Act has been committed by a person, being a company, and the punishment for such offence is imprisonment and fine, then, without prejudice to the provisions contained in sub-section (1) or sub-section (2), such company shall be punished with fine and every person, referred to in sub-section (1), or the director, manager, secretary or other officer of the company referred to in subsection (2), shall be liable to be proceeded against and punished in accordance with the provisions of this Act.
Explanation.-For the purposes of this section,-
(a) "company" means a body corporate, and includes-
(i) a firm; and
(ii) an association of persons or a body of individuals whether incorporated
or not; and
(b) "director", in relation to-
(i) a firm, means a partner in the firm;
(ii) any association of persons or a body of individuals, means any member
controlling the affairs thereof.
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1. Ins. by Act 23 of 2004, s. 61 (w.e.f. 1-10-2004).
Section 278A Punishment for second and subsequent offences
Section 278AA Punishment not to be imposed in certain cases
Section 278AB Power of Principal Commissioner or Commissioner to grant immunity from prosecution
Section 278B Offences by companies
Section 278C Offences by Hindu undivided families
Section 278D Presumption as to assets, books of account, etc., in certain cases
Section 278E Presumption as to culpable mental state
Section 279A Certain offences to be non-cognizable