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      Question

      Section 33 of the SARFAESI Act deals with offences by

      companies. If an offence under the Act is committed by a company, who shall be deemed guilty and shall be liable to be proceeded against?
      A Only the company as a legal entity; no individual officer can be prosecuted Correct Answer Incorrect Answer
      B Only the managing director, regardless of knowledge or involvement Correct Answer Incorrect Answer
      C Any employee at any level who was directly involved in the offence Correct Answer Incorrect Answer
      D The company and every person who at the time of the offence was in charge of and responsible for the conduct of the company's business, unless they prove they had no knowledge or exercised all due diligence Correct Answer Incorrect Answer
      E The statutory auditor of the company who failed to report the offence Correct Answer Incorrect Answer

      Solution

      Section 33(1) provides that where an offence under the SARFAESI Act has been committed by a company, every person who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly. However, such a person is not liable if they prove that the offence was committed without their knowledge, or that they exercised all due diligence to prevent commission of the offence. Section 33(2) further provides that where the offence is attributed to neglect or consent of a director, manager, secretary or officer, that person shall also be deemed guilty.

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