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Compounding of offences & Condonation of delay Companies Act, 2013. As we all know, In the current scenario there are a lot of provisions along with different types of laws that are applicable to a company and due to the non-availability of expert advice and thief of time companies are unable to manage the compliance of all the laws and due to which they attract heavy penalties along with prosecution.

In today’s Corporate world, good governance means complying with all the provisions of Corporate laws. Noncompliance will result in penalties or penalties with imprisonment. Corporate offences are classified into civil and criminal offences. Further, it has been classified as a Compoundable and Non-compoundable offence. The Compounding of offences is a short cut method to avoid litigation

So the Act has clearly laid down the mechanism and the forum for speedy and smooth administration of judicial activities under the Companies Act, 2013.

Types of Offences can be compounded

As per Section 441 of the Companies Act, 2013, not all the Offences can be compounded. Only the following offences can be compounding under section 441(1) of the Act by certain authorities

  • Compoundable Offences

1. Offence punishable with “Fine Only”

2.  Offence punishable with “fine or imprisonment or both” or “Fine or Imprisonment”

No compounding shall be done in the following cases:

  • Non Compoundable Offences

1. Offence punishable with “imprisonment only” or

2. Offence punishable with “imprisonment and fine” or

3. Where an investigation has been initiated or is pending against the company; (Section 441(1))

4. Where similar offence has been compounded within last 3 years (Section 441(2))



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