Composition of offences - Scope of provision

Compounding of company law offences permits settlement by fee payment, barring prosecution and imposing compliance conditions.

The Act permits compounding of offences not punishable exclusively by imprisonment, with applications made by the company or officers in default to the Registrar for onward submission to the designated adjudicatory authority. Compounding bars subsequent prosecution and may terminate pending prosecutions by discharge. The authority may require filing of returns or documents within a specified time, non compliance of which is separately punishable. A single order can compound multiple offences, but a similar offence committed later cannot be compounded within three years. Composition fees are payable from company funds or, where applicable, from personal funds of officers in default.