(1) Where an offence under this Act has been committed by a deposit taker other than an individual, every person who, at the time the offence was committed, was in charge of, and was responsible to, the deposit taker for the conduct of its business, as well as the deposit taker, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.
(2) Nothing contained in sub-section (1) shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.
(3) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a deposit taker other than an individual, and it is proved that the offence—
(a) has been committed with the consent or connivance of; or
(b) is attributable to any neglect on the part of any director, manager, secretary, promoter, partner, employee or other officer of the deposit taker,
such person shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
(2) Nothing contained in sub-section (1) shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.
(3) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a deposit taker other than an individual, and it is proved that the offence—
(a) has been committed with the consent or connivance of; or
(b) is attributable to any neglect on the part of any director, manager, secretary, promoter, partner, employee or other officer of the deposit taker,
such person shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
Source footnotes
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More sections of this act
Section 1 · Short title, extent and commencement.Section 2 · Definitions.Section 3 · Banning of Unregulated Deposit Schemes.Section 4 · Fraudulent default in Regulated Deposit Schemes.Section 5 · Wrongful inducement in relation to Unregulated Deposit Schemes.Section 6 · Certain scheme to be Unregulated Deposit Scheme.Section 7 · Competent Authority.Section 8 · Designated Court.India Code, Government of India. Text fetched 16 Oct 2026. Check the linked official text and subsequent notifications when applying a provision.