Section 56 of the Code on Wages, 2019: Composition of Offences

Section 56 provides a statutory mechanism for compounding specified offences under the Code on Wages, 2019. In practical terms, an eligible offence may be settled by payment of the prescribed composition amount instead of continuing with prosecution, subject to the restrictions and procedure laid down in the Code and the applicable rules.

Current legal status: The Code on Wages, 2019 was brought fully into force with effect from 21 November 2025. For establishments for which the Central Government is the appropriate Government, Rule 54 of the Code on Wages (Central) Rules, 2026 prescribes the manner of composition and Form VI for the application.

What does "composition of offences" mean?

Composition is a statutory method of resolving an eligible offence by payment of the amount fixed by law to the authorised compounding officer. It is available only where the offence satisfies Section 56 and the prescribed procedure is followed. Section 56 does not permit every offence under the Code to be compounded.

Key points under Section 56
  • The accused person must apply for composition.
  • An application may be made before or after prosecution is instituted.
  • An offence punishable with imprisonment only, or with imprisonment and fine, is excluded from the compounding mechanism in sub-section (1).
  • The statutory composition amount is 50% of the maximum fine provided for the eligible offence.
  • A similar repeat offence within the specified five-year period is excluded where the earlier similar offence was compounded or resulted in conviction.
  • If composition occurs before prosecution, prosecution for that compounded offence is not to be instituted against that offender.
  • If composition occurs after prosecution has begun, the composition is notified to the court and the person is discharged in accordance with sub-section (6).

Bare provision: Section 56 - Composition of offences

56. (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, any offence punishable under this Code, not being an offence punishable with imprisonment only, or with imprisonment and also with fine, may, on an application of the accused person, either before or after the institution of any prosecution, be compounded by a Gazetted Officer, as the appropriate Government may, by notification, specify, for a sum of fifty per cent. of the maximum fine provided for such offence, in the manner as may be prescribed.

(2) Nothing contained in sub-section (1) shall apply to an offence committed by a person for the second time or thereafter within a period of five years from the date- (i) of commission of a similar offence which was earlier compounded; (ii) of commission of similar offence for which such person was earlier convicted.

(3) Every officer referred to in sub-section (1) shall exercise the powers to compound an offence, subject to the direction, control and supervision of the appropriate Government.

(4) Every application for the compounding of an offence shall be made in such manner as may be prescribed.

(5) Where any offence is compounded before the institution of any prosecution, no prosecution shall be instituted in relation to such offence, against the offender in relation to whom the offence is so compounded.

(6) Where the composition of any offence is made after the institution of any prosecution, such composition shall be brought by the officer referred to in sub-section (1) in writing, to the notice of the court in which the prosecution is pending and on such notice of the composition of the offence being given, the person against whom the offence is so compounded shall be discharged.

(7) Any person who fails to comply with an order made by the officer referred to in sub-section (1), shall be punishable with a sum equivalent to twenty per cent. of the maximum fine provided for the offence, in addition to such fine.

(8) No offence punishable under the provisions of this Code shall be compounded except under and in accordance with the provisions of this section.

Section 56 explained

1. Which offences can be compounded?

Sub-section (1) permits compounding of an offence punishable under the Code except an offence punishable with imprisonment only or with imprisonment and fine. Eligibility therefore depends on the punishment attached to the particular offence, read with the other restrictions in Section 56.

2. Who can apply?

The application is made by the accused person. The power to compound is exercised by a Gazetted Officer specified by the appropriate Government through notification.

3. What is the composition amount?

The Code fixes the amount at 50% of the maximum fine provided for the eligible offence. Under Central Rule 54, once composition is accepted, the amount must be paid within 30 days of the composition order.

4. What is the five-year restriction?

Sub-section (2) prevents use of sub-section (1) for a second or subsequent similar offence within five years where the earlier similar offence was compounded or the person was earlier convicted for the similar offence.

5. What happens if the offence is compounded before prosecution?

Under sub-section (5), prosecution is not to be instituted in relation to the compounded offence against the offender for whom the offence has been compounded.

6. What happens if prosecution is already pending?

Under sub-section (6), the compounding officer must bring the composition in writing to the notice of the court where the prosecution is pending. Upon such notice, the person against whom the offence has been compounded is to be discharged.

7. Is there any consequence for non-compliance with the compounding order?

Sub-section (7) provides a further monetary consequence equal to 20% of the maximum fine for failure to comply with an order made by the officer referred to in sub-section (1), in addition to the fine specified there.

Central procedure: Rule 54 and Form VI

For matters governed by the Central Rules, Rule 54 of the Code on Wages (Central) Rules, 2026 provides the operational procedure. The accused may apply electronically or manually in Form VI to the notified Gazetted Officer. The officer must determine whether the offence is compoundable. If it is compoundable and the accused agrees, the offence is compounded for 50% of the maximum fine.

The composition amount is to be paid within 30 days of the composition order. After receipt of the amount, the compounding officer is to issue the composition certificate in Part B of Form VI within 10 days. If the amount is not deposited within the specified period, the Central Rules provide for prosecution before the competent court. Where prosecution was already instituted, the order is to be communicated for the action contemplated by Section 56(6).

Appropriate Government matters: The Code allocates functions between the Central Government and State Governments through the concept of the "appropriate Government." The applicable notification, compounding officer and procedural rules should therefore be checked for the establishment and jurisdiction concerned.

Why does Section 56 still mention the Code of Criminal Procedure, 1973?

The enacted text of Section 56 expressly refers to the Code of Criminal Procedure, 1973. The Bharatiya Nagarik Suraksha Sanhita, 2023 replaced the Code of Criminal Procedure, 1973 with effect from 1 July 2024. The bare text above is retained as enacted; current procedural application should be read with the later criminal procedure legislation and applicable savings and transition provisions.

Section 56 forms part of Chapter VIII on offences and penalties. It should be read with Sections 52 and 53 on cognizance and imposition of penalties, Section 54 on penalties for offences, and Section 55 on offences by companies.

Last reviewed: 16 September 2026. This page is an informational summary. For a specific proceeding, verify the latest Central or State notification identifying the competent compounding officer and the rules applicable to the establishment.