Punishment for contravention
Section 147 of the Companies Act, 2013 deals with punishment for contravention. If any of the provisions of sections 139 to 146 (both inclusive) is contravened, the company shall be punishable with fine which shall not be less than twenty-five thousand rupees but which may extend to five lakh rupees and every officer of the company who is in default shall be punishable with fin The Act came into force on 01 Apr 2014.
(1) If any of the provisions of sections 139 to 146 (both inclusive) is contravened, the company shall be punishable with fine which shall not be less than twenty-five thousand rupees but which may extend to five lakh rupees and every officer of the company who is in default shall be punishable 1*** with fine which shall not be less than ten thousand rupees but which may extend to 2[one lakh rupees].
(2) If an auditor of a company contravenes any of the provisions of section 139, section 143, section 144 or section 145, the auditor shall be punishable with fine which shall not be less than twenty-five thousand rupees but which may extend to five lakh rupees 3 [or four times the remuneration of the auditor, whichever is less]:
Provided that if an auditor has contravened such provisions knowingly or willfully with the intention to deceive the company or its shareholders or creditors or tax authorities, he shall be punishable with imprisonment for a term which may extend to one year 4 [and with fine which shall not be less than fifty thousand rupees but which may extend to twenty-five lakh rupees or eight times the remuneration of the auditor, whichever is less].
(3) Where an auditor has been convicted under sub-section (2), he shall be liable to--
(i) refund the remuneration received by him to the company; and
(ii) pay for damages to the company, statutory bodies or authorities 5 [or to members or creditors of the company] for loss arising out of incorrect or misleading statements of particulars made in his audit report.
(4) The Central Government shall, by notification, specify any statutory body or authority or an officer for ensuring prompt payment of damages to the company or the persons under clause (ii) of sub-section (3) and such body, authority or officer shall after payment of damages to such company or persons file a report with the Central Government in respect of making such damages in such manner as may be specified in the said notification.
(5) Where, in case of audit of a company being conducted by an audit firm, it is proved that the partner or partners of the audit firm has or have acted in a fraudulent manner or a betted or colluded in any fraud by, or in relation to or by, the company or its directors or officers, the liability, whether civil or criminal as provided in this Act or in any other law for the time being in force, for such act shall be of the partner or partners concerned of the audit firm and of the firm jointly and severally.
6 [Provided that in case of criminal liability of an audit firm, in respect of liability other than fine, the concerned partner or partners, who acted in a fraudulent manner or abetted or, as the case may be, colluded in any fraud shall only be liable.]
Section 147, The Companies Act, 2013 (Act 18 of 2013).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
-
Sky Cotex India PVT LTD vs The Registrar of Companies
Court's Decision & Legal Precedent
Failure by a company covered by the Companies (Cost Records and Audit) Rules, 2014 to appoint a cost auditor within the prescribed 180 days and to file the prescribed forms attracts prosecution of the company and its officer in default under Section 147(1), which Section 148(8)(a) makes the punishing provision. Such a default is a continuing offence within Section 472 CrPC, so a fresh period of limitation runs each day until compliance ceases the offence (here, the filing of Form CRA-4), and a complaint filed within one year of that date is not barred; the petition to quash was dismissed, with liberty to compound.
On this section: It construes Section 147(1) as the operative punishment clause for defaults in the audit chapter and uses the one-year maximum imprisonment it prescribes to fix the limitation period under Section 468 CrPC for prosecuting such a default.
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
-
… Mr. Hossain then took us through the provisions contained in Section 147 of the Companies Act and which contemplates the imposition of punishment upon a firm as well as its member. The relevant parts of Section 147 are extracted hereinbelow:- > " 147. Punishment for contravention .—(1) If any of the provisions of Sections 139 to 146 (both inclusive) is contravened, the company shall …
-
… Mr. Hossain then took us through the provisions contained in Section 147 of the Companies Act and which contemplates the imposition of punishment upon a firm as well as its member. The relevant parts of Section 147 are extracted hereinbelow:- > " 147. Punishment for contravention .—(1) If any of the provisions of Sections 139 to 146 (both inclusive) is contravened, the company shall …
-
… Mr. Hossain then took us through the provisions contained in Section 147 of the Companies Act and which contemplates the imposition of punishment upon a firm as well as its member. The relevant parts of Section 147 are extracted hereinbelow:- > " 147. Punishment for contravention .—(1) If any of the provisions of Sections 139 to 146 (both inclusive) is contravened, the company shall …
Made under this section, and citing it
2 instruments state that it was made under this provision — the power to make it comes from here, so a change to any of them changes what this section requires in practice. Newest first.
Questions about Section 147
What have the courts held on Section 147 of the Companies Act?
Sky Cotex India PVT LTD vs The Registrar of Companies (26 Sep 2022) is the leading judgment on this section among those set out below: It construes Section 147(1) as the operative punishment clause for defaults in the audit chapter and uses the one-year maximum imprisonment it prescribes to fix the limitation period under Section 468 CrPC for prosecuting such a default.
How do I find court cases under Section 147 of the Companies Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Companies Act 147, section 147 Companies Act, section 147 of the Companies Act. People searching for it also type companies act 2013 section 147. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 1 reported judgment on this section is set out on this page, beginning with Sky Cotex India PVT LTD vs The Registrar of Companies (26 Sep 2022).
What should I read with Section 147 of the Companies Act, and has it changed?
Its own text turns on section 139 (Appointment of auditors), section 143 (Powers and duties of auditors and auditing standards), section 144 (Auditor not to render certain services), section 145 (Auditor to sign audit reports, etc), and on 1 further provision, so none of them can safely be read on its own. 2 other provisions in this corpus refer back to it. The rules and notifications made under it are where it actually bites, and there are 2: most recently G.S.R. 206(E)-Companies (Audit and Auditors) Amendment Rules, 2021. (2021), then G.S.R. 248(E)-Companies (Audit and Auditors) Second Amendment Rules, 2021 (2021).
When did Section 147 of the Companies Act come into force?
Section 147 of the Companies Act, cited as Companies Act 147, came into force on 01 Apr 2014, having been enacted on 29 Aug 2013. It is in force as at the date shown on this page.
Other sections of this Act
- 2. Definitions5089 words
- 143. Powers and duties of auditors and auditing standards1867 words
- 230. Power to compromise or make arrangements with creditors and members1432 words
- 232. Merger and amalgamation of companies1416 words
- 149. Company to have Board of Directors1403 words
- 217. Procedure, powers, etc., of inspectors1390 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 14 Oct 2026. This page is not a substitute for legal advice.