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FRAUD [EXPLANATIONS TO SECTION 447]
For the purpose of Section 447, in relation to affairs of a company or a body corporate, a fraud includes:
ü any act, or
ü omission, or
ü concealment of any fact, or
ü abuse of position;
- with intent to deceive, or
- to gain undue advantage from, or
- to injure the interests of;
- the company or
- its shareholders, or
- its creditors, or
- any other person
- by any person, or
- by any other person with connivance in any manner;
ü whether or not:
- any wrongful gain, or
- any wrong loss.
Wrongful Gain:
Wrongful gain means the gain by unlawful means of property to which the person gaining is not legally entitled.
Wrongful loss:
Wrongful loss means the loss by unlawful means of property to which the person losing is legally entitled.
PUNISHMENT FOR FRAUD [SECTION 447]
Any person who is found guilty of fraud shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to ten years and shall also be liable to fine which shall not be less than the amount involved in the fraud but which may extend to three times the amount involved in the fraud.
This imprisonment and fine does not rescue the accused from any liability including repayment of any debt under this Act or any other law for the time being in force.
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