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Section 68 – The Companies Act,1956

The Companies Act, 1956

68. Penalty for fraudulently inducing persons to invest money.

Any person who either by knowingly or recklessly making any statement, promise or forecast which is false, deceptive or misleading or by any dishonest concealment of material facts, induces or attempts to induce another person to enter into, or to offer to enter into

(a)any agreement for or with a view to acquiring, disposing of, subscribing for, or underwriting shares or debentures; or

(b)any agreement the purpose or pretended purpose of which is to secure a profit to any of the parties from the yield of shares or debentures, or by reference to fluctuations in the value of shares or debentures,

shall be punishable with imprisonment for a term which may extend to five years, or with fine which may extend to 1[one lakh rupees], or with both.


1. Subs. by Act 53 of 2000, sec. 25, for “ten thousand rupees” (w.e.f. 13-12-2000).

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The Companies Act, 1956

Indian Laws – Bare Acts


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