(1) Whoever in any return, balance-sheet or other document 1[or in any information required or furnished] by or under or for the purposes of any provision of this Act, wilfully makes a statement which is false in any material particular, knowing it to be false, or wilfully omits to make a material statement, shall be punishable with imprisonment for a term which may extend to three years and 2[or with fine, which may extend to one crore rupees or with both].
(2) If any person fails to produce any book, account or other document or to furnish any statement or information which under sub-section (2) of section 35 it is his duty to produce or furnish, or to answer any question relating to the business of a banking company which he is asked by 3[an officer making an inspection or scrutiny under that section], he shall be punishable with a fine which may extend to 4[twenty lakh rupees] in respect of each offence, and if he persists in such refusal, to a further fine which may extend to 5[fifty thousand rupees] for every day during which the offence continues.
(3) If any deposits are received by a banking company in contravention of an order under clause (a) of sub-section (4) of section 35, every director or other officer of the banking company, unless he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent it, shall be deemed to be guilty of such contravention and shall be punishable with a fine which may extend to twice the amount of the deposits so received.
6[(4) If any other provision of this Act is contravened or if any default is made in--
(i) complying with any requirement of this Act or of any order, rule or direction made or condition imposed thereunder, or
(ii) carrying out the terms of, or the obligations under, a scheme sanctioned under sub-section (7) of section 45,
by any person, such person shall be punishable with fine which may extend to 7[ 8[one crore rupees] or twice the amount involved in such contravention or default where such amount is quantifiable, whichever is more, and where a contravention or default is a continuing one, with a further fine which may extend to 9[one lakh rupees]] for every day, during which the contravention or default continues.]
10[(5) Where a contravention or default has been committed by a company, every person who, at the time the contravention or default was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the contravention or default and shall be liable to be proceeded against and punished accordingly:
Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act if he proves that the contravention or default was committed without his knowledge or that he exercised all due diligence to prevent the contravention or default.
(6) Notwithstanding anything contained in sub-section (5), where a contravention or default has been committed by a company, and it is proved that the same was committed with the consent or connivance of, or is attributable to any gross negligence on the part of, any director, manager, secretary or other officer of the company, such director manager, secretary or other officer shall also be deemed to be guilty of that contravention or default and shall be liable to be proceeded against and punished accordingly.
Explanation.--For the purposes of this section,--
(a) "company" means any body corporate and includes a firm or other association of individuals; and
(b) "director", in relation to a firm, means a partner in the firm.]
(2) If any person fails to produce any book, account or other document or to furnish any statement or information which under sub-section (2) of section 35 it is his duty to produce or furnish, or to answer any question relating to the business of a banking company which he is asked by 3[an officer making an inspection or scrutiny under that section], he shall be punishable with a fine which may extend to 4[twenty lakh rupees] in respect of each offence, and if he persists in such refusal, to a further fine which may extend to 5[fifty thousand rupees] for every day during which the offence continues.
(3) If any deposits are received by a banking company in contravention of an order under clause (a) of sub-section (4) of section 35, every director or other officer of the banking company, unless he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent it, shall be deemed to be guilty of such contravention and shall be punishable with a fine which may extend to twice the amount of the deposits so received.
6[(4) If any other provision of this Act is contravened or if any default is made in--
(i) complying with any requirement of this Act or of any order, rule or direction made or condition imposed thereunder, or
(ii) carrying out the terms of, or the obligations under, a scheme sanctioned under sub-section (7) of section 45,
by any person, such person shall be punishable with fine which may extend to 7[ 8[one crore rupees] or twice the amount involved in such contravention or default where such amount is quantifiable, whichever is more, and where a contravention or default is a continuing one, with a further fine which may extend to 9[one lakh rupees]] for every day, during which the contravention or default continues.]
10[(5) Where a contravention or default has been committed by a company, every person who, at the time the contravention or default was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the contravention or default and shall be liable to be proceeded against and punished accordingly:
Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act if he proves that the contravention or default was committed without his knowledge or that he exercised all due diligence to prevent the contravention or default.
(6) Notwithstanding anything contained in sub-section (5), where a contravention or default has been committed by a company, and it is proved that the same was committed with the consent or connivance of, or is attributable to any gross negligence on the part of, any director, manager, secretary or other officer of the company, such director manager, secretary or other officer shall also be deemed to be guilty of that contravention or default and shall be liable to be proceeded against and punished accordingly.
Explanation.--For the purposes of this section,--
(a) "company" means any body corporate and includes a firm or other association of individuals; and
(b) "director", in relation to a firm, means a partner in the firm.]
Source footnotes
1 Subs. by Act 95 of 1956, s. 9, for "required" (w.e.f. 14-1-1957).2 Subs. by Act 4 of 2013, s. 11, for "and shall also be liable to fine" (w.e.f. 18-1-2013).
3 Subs. by Act 1 of 1984, s. 38, for "an officer making an inspection under that section" (w.e.f. 15-2-1984).
4 Subs. by Act 4 of 2013, s. 11, for "two thousand rupees" (w.e.f. 18-1-2013).
5 Subs. by s. 11, ibid., for "one hundred rupees" (w.e.f. 18-1-2013).
6 Subs. by Act 1 of 1984, s. 38, for sub-section (4) (w.e.f. 15-2-1984).
7 Subs. by Act 20 of 1994, s. 8, for certain words (w.e.f. 31-1-1994).
8 Subs. by Act 4 of 2013, s. 11, for "fifty thousand rupees" (w.e.f. 18-1-2013).
9 Subs. by s. 11, ibid., for "two thousand and five hundred rupees" (w.e.f. 18-1-2013).
10 Subs. by Act 55 of 1963, s. 25, for sub-section (4) (w.e.f. 1-2-1964).
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More sections of this act
Section 1 · Short title, extent and commencement.Section 2 · Application of other laws not barred.Section 3 · Act not to apply to certain co-operative societies.Section 4 · Power to suspend operation of Act.Section 5 · Interpretation.Section 5A · Act to override memorandum, articles, etc.Section 6 · Form of business in which banking companies may engage.Section 7 · Use of words "bank", "banker", "banking" or "banking company".India Code, Government of India. Text fetched 15 Oct 2026. Source metadata reports last modification: 2026-01-06. Check the linked official text and subsequent notifications when applying a provision.