Companies Act • Official Statutory Text & Practice Guide
Statutory Regulation
Legal Standard
Competent Court / Tribunal
Act 2013
Section 267 of Companies Act: Corporate Governance & Statutory Compliance
Official Bare Act Text
Override / Mandate Mens Rea (Intent) Actus Reus (Conduct) Punishment Limitation Monetary
Whoever violates the provisions of this Chapter or any scheme, or any order, of the Tribunal or the Appellate Tribunal or makes a false statement or gives false evidence before the Tribunal or the Appellate Tribunal or attempts to tamper with the records of reference or appeal filed under this Act, he shall be punishable with imprisonment for a term which may extend to seven years and with fine which may extend to ten lakh rupees.
Statutory Defined Terms in this Section:(Click any term for official legal definition)
Section 267 historically prescribed criminal punishment for offences committed during rehabilitation proceedings, penalizing asset concealment and book falsification; omitted by the Insolvency and Bankruptcy Code, 2016, these penal sanctions are now codified in Chapter VII of Part II of the IBC.
Criminalization of Asset Concealment and Fraud: Prescribed penal imprisonment and fines for directors, officers, or persons who concealed corporate assets, destroyed records, or fabricated accounts during revival.
Integrity of Quasi-Judicial Proceedings: Enforced truthfulness in filings before the administrator and Tribunal, establishing strict criminal deterrence against managerial deception.
Successor Penal Provisions under IBC: Omitted by the IBC and replaced by Sections 68 (concealment of property), 70 (misconduct in CIRP), and 71 (falsification of books) of the IBC, carrying up to five years imprisonment.
Key Landmark Precedents:
Innoventive Industries Ltd. v. ICICI Bank, (2018) 1 SCC 407: The Supreme Court observed that the penal provisions in insolvency legislation are critical for deterring fraudulent diversion and managerial sabotage of corporate assets.
Dr. A. Shanmugam v. N.K. Anbualagan, (2012) 6 SCC 430: Affirmed that suppression of facts and fraudulent statements in judicial proceedings must be met with severe civil and criminal consequences to preserve judicial integrity.
Subrata Roy Sahara v. Union of India, (2014) 8 SCC 470: Affirmed the zero-tolerance standard against misleading disclosures and deliberate concealment of financial assets in corporate regulatory proceedings.
Courtroom Practice & Strategic Litigation Guidance:
When evidence of fraudulent asset dissipation or doctored balance sheets is discovered during insolvency, move the NCLT under Section 236 IBC to file a formal criminal complaint before the Special Court, while invoking Sections 68, 70, and 71 IBC against the culpable promoter-directors.
Legal Commentary & Landmark Judgments: Section 267
Section 267 historically prescribed criminal punishment for offences committed during rehabilitation proceedings, penalizing asset concealment and book falsification; omitted by the Insolvency and Bankruptcy Code, 2016, these penal sanctions are now codified in Chapter VII of Part II of the IBC.
When evidence of fraudulent asset dissipation or doctored balance sheets is discovered during insolvency, move the NCLT under Section 236 IBC to file a formal criminal complaint before the Special Court, while invoking Sections 68, 70, and 71 IBC against the culpable promoter-directors.