Section 68 Punishment for concealment of property
“(1) Where any officer of the corporate debtor has, –
(i) within the twelve months immediately preceding the insolvency commencement date, –
(a) wilfully concealed any property or part of such property of the corporate debtor or concealed any debt due to, or
from, the corporate debtor, of the value of ten thousand rupees or more; or
(b) fraudulently removed any part of the property of the corporate debtor of the value of ten thousand rupees or
more; or
(c) wilfully concealed, destroyed, mutilated or falsified any book or paper affecting or relating to the property of the
corporate debtor or its affairs, or
(d) wilfully made any false entry in any book or paper affecting or relating to the property of the corporate debtor or
its affairs, or
(e) fraudulently parted with, altered or made any omission in any document affecting or relating to the property of
the corporate debtor or its affairs, or
(f) wilfully created any security interest over, transferred or disposed of any property of the corporate debtor which
has been obtained on credit and has not been paid for unless such creation, transfer or disposal was in the ordinary
course of the business of the corporate debtor, or
(g) wilfully concealed the knowledge of the doing by others of any of the acts mentioned in clauses (c), (d) or
clause (e); or
(ii) at any time after the insolvency commencement date, committed any of the acts mentioned in sub-clause (a) to (f)
of clause (i) or has the knowledge of the doing by others of any of the things mentioned in sub-clauses (c) to (e) of
clause (i); or
(iii) at any time after the insolvency commencement date, taken in pawn or pledge, or otherwise received the property
knowing it to be so secured, transferred or disposed, such officer shall be punishable with imprisonment for a term which
shall not be less than three years but which may extend to five years and with fine, which shall not be less than one lakh
rupees, but may extend to one crore rupees, or with both:
Provided that nothing in this section shall render a person liable to any punishment under this section if he proves that he
had no intent to defraud or to conceal the state of affairs of the corporate debtor.”
VL Note : –
Section 69 Punishment for transactions defrauding creditors
“If an officer of the corporate debtor or the corporate debtor-
(a) has made or caused to be made any gift or transfer of, or charge on, or has caused or connived in the execution of a
decree or order against, the property of the corporate debtor;
(b)has concealed or removed any part of the property of the corporate debtor within two months before the date of any
unsatisfied judgment, decree or order for payment of money obtained against the corporate debtor, such officer of the
corporate debtor or the corporate debtor, as the case may be, shall be punishable with imprisonment for a term which
shall not be less than one year, but which may extend to five years, or with fine which shall not be less than one lakh
rupees, but may extend to one crore rupees, or with both:
Provided that a person shall not be punishable under this section if the acts mentioned in clause (a) were committed more
than five years before the insolvency commencement date; or if he proves that, at the time of commission of those acts, he
had no intent to defraud the creditors of the corporate debtor.”
VL Note : –
Section 70 Punishment for misconduct in course of corporate insolvency resolution process
“(1) On or after the insolvency commencement date, where an officer of the corporate debtor —
(a) does not disclose to the resolution professional all the details of property of the corporate debtor, and details of
transactions thereof, or any such other information as the resolution professional may require; or
(b)does not deliver to the resolution professional all or part of the property of the corporate debtor in his control or
custody and which he is required to deliver; or
(c) does not deliver to the resolution professional all books and papers in his control or custody belonging to the
corporate debtor and which he is required to deliver; or
(d) fails to inform their solution professional the information in his knowledge that a debt has been falsely proved by
any person during the corporate insolvency resolution process; or
(e) prevents the production of any book or paper affecting or relating to the property or affairs of the corporate
debtor; or
(f) accounts for any part of the property of the corporate debtor by fictitious losses or expenses, or if he has so
attempted at any meeting of the creditors of the corporate debtor within the twelve months immediately preceding the
insolvency commencement date, he shall be punishable with imprisonment for a term which shall not be less than three
years, but which may extend to five years, or with fine, which shall not be less than one lakh rupees,
but may extend to one crore rupees, or with both:
Provided that nothing in this section shall render a person liable to any punishment under this section if he proves that he
had no intent to do so in relation to the state of affairs of the corporate debtor.
(2) If an insolvency professional deliberately contravenes the provisions of this Part, the shall be punishable with
imprisonment for a term which may extend to six months, or with fine which shall not less than one lakh rupees, but may
extend to five lakhs rupees, or with both.”
VL Note : –
Section 71 Punishment for falsification of books of corporate debtor
“On and after the insolvency commencement date, where any person destroys, mutilates, alters or falsifies any books,
papers or securities, or makes or is in the knowledge of making of any false or fraudulent entry in any register, books of
account or document belonging to the corporate debtor with intent to defraud or deceive any person, he shall be punishable
with imprisonment for a term which shall not be less than three years, but which may extend to five years, and with fine
which shall not be less than one lakh rupees, but may extend to one crore rupees, or with both.”
VL Note : –
“Where an officer of the corporate debtor makes any material and wilful omission in any statement relating to the affairs of
the corporate debtor, he shall be punishable with imprisonment for a term which shall not be less than three years but which
may extend to five years, or with fine which shall not be less than one lakh rupees, but may extend to one crore
rupees, or with both”
VL Note : –
Section 73 Punishment for false representations to creditors
“(1) Where any officer of the corporate debtor —
(a) on or after the insolvency commencement date, makes a false representation or commits any fraud for the purpose
of obtaining the consent of the creditors of the corporate debtor or any of them to an agreement with reference to the
affairs of the corporate debtor, during the corporate insolvency resolution process, or the liquidation process;
(b) prior to the insolvency commencement date, has made any false representation, or committed any fraud, for that
purpose, he shall be punishable with imprisonment for a term which shall not be less than three years, but may extend
to five years or with fine which shall not be less than one lakh rupees, but may extend to one crore rupees, or with
both.”
VL Note : –
Section 74 Punishment for contravention of moratorium or the resolution plan
“(1) Where the corporate debtor or any of its officer violates the provisions of section 14, any such officer who knowingly or
wilfully committed or authorised or permitted such contravention shall be punishable with imprisonment for a term which
shall not be less than three years, but may extend to five years or with fine which shall not be less than one lakh rupees, but may extend to three lakh rupees, or with both.
(2) Where any creditor violates the provisions of section 14, any person who knowingly and wilfully authorised or permitted
such contravention by a creditor shall be punishable with imprisonment for a term which shall not be less than one year, but
may extend to five years, or with fine which shall not be less than one lakh rupees, but may extend to one crore rupees,
or with both.
(3) Where the corporate debtor, any of its officers or creditors or any person on whom the approved resolution plan is binding
under section 31, knowingly and wilfully contravenes any of the terms of such resolution plan or abets such contravention,
such corporate debtor, officer, creditor or person shall be punishable with imprisonment of not less than one year, but may
extend to five years, or with fine which shall not be less than one lakh rupees, but may extend to one crore rupees, or with
both.”
VL Note : –
Section 75 Punishment for false information furnished in application
“Where any person furnishes information in the application made under section 7, which is false in material particulars,
knowing it to be false or omits any material fact, knowing it to be material, such person shall be punishable with fine which
shall not be less than one lakh rupees, but may extend to one crore rupees.”
VL Note : –
Section 76 Punishment for non-disclosure of dispute or 1 [payment] of debt by operational creditor
“Where-
(a) an operational creditor has wilfully or knowingly concealed in an application under section 9 the fact that the corporate
debtor had notified him of a dispute in respect of the unpaid operational debt or the full and final payment of the unpaid
operational debt; or
(b) any person who knowingly and wilfully authorised or permitted such concealment under clause (a) such operational
creditor or person, as the case may be, shall be punishable with imprisonment for a term which shall not be less than one
year but may extend to five years or with fine which shall not be less than one lakh rupees but may extend to one crore
rupees, or with both”
VL Note : –
Section 77 “Punishment for providing false information in application made by corporate debtor”
“Where-
(a) a corporate debtor provides information in the application under section 10 which is false in material particulars, knowing
it to be false and omits any material fact, knowing it to be material; or
(b) any person who knowingly and wilfully authorised or permitted the furnishing of such information under sub-clause (a)
such corporate debtor or person, as the case may be, shall be punishable with imprisonment for a term which shall not be
less than three years, but which may extend to five years and with fine which shall not be less than one lakh rupees, but
which may extend to one crore rupees, or with both.
Explanation. – For the purpose of this section and sections 75 and 76, an application shall be deemed to be false in material
particulars in case the facts mentioned or omitted in the application, if true, or not omitted from the application as the case
may be, would have been sufficient to determine the existence of a default under this Code.”
VL Note : –