Section 38 Punishment for
personation etc of Securities - Indian Companies Act 2013
As per Section 38 of
Act 2013 personation for securities is a punishable offence. Provision in the Companies Act 2013 related to
Punishment for personation etc of Securities is as under.
(1) Any person who
(a) makes or abets making of an application in a fictitious name to a company
for acquiring, or subscribing for, its securities; or
(b) makes or abets making of multiple applications to a company in different
names or in different combinations of his name or surname for acquiring or
subscribing for its securities; or
(c) otherwise induces directly or indirectly a company to allot, or register any
transfer of, securities to him, or to any other person in a fictitious name,
shall be liable for action under section 447.
(2) The provisions of sub-section (1) shall be prominently reproduced in every
prospectus issued by a company and in every form of application for securities.
(3) Where a person has been convicted under this section, the Court may also
order disgorgement of gain, if any, made by, and seizure and disposal of the
securities in possession of, such person.
(4) The amount received through disgorgement or disposal of securities under
subsection (3) shall be credited to the Investor Education and Protection Fund.