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    Compounding Vs Adjudication

    Posted By : Juhee Goyal / Published on : 20-Apr-2023 06:43 AM / View : 173 / Comment : 1

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    Hi All!

    What is the difference between Compounding and Adjudication?
    Read more on : adjudication compounding

    • Compounding and adjudication are two different legal mechanisms used in India to settle or resolve offences or violations under various laws.

      Compounding refers to the process where the accused or the offender can voluntarily admit to the offence committed and pay a fine or penalty as prescribed under the law. The offence is then deemed to have been compounded or settled, and the accused is not liable to be prosecuted or punished for the same offence. Compounding is generally available for minor offences or violations, and the purpose of this mechanism is to expedite the settlement of cases and reduce the burden on the judicial system.

      Adjudication, on the other hand, refers to the legal process of deciding or determining the guilt or innocence of the accused or the offender. It involves a formal hearing or trial, where evidence is presented, arguments are made, and a decision is made based on the facts and law. Adjudication is typically used for more serious offences or violations, and the purpose of this mechanism is to ensure that justice is served and the guilty are punished.

      In summary, compounding is a voluntary mechanism where the offender admits to the offence and pays a fine, while adjudication is a formal legal process of determining the guilt or innocence of the accused or offender.


      Under the Companies Act, 2013, compounding and adjudication are legal mechanisms for settling or resolving offences or violations committed by companies.

      Section 441 of the Companies Act, 2013, provides for compounding of offences by the companies. This section allows the company or any officer of the company to make an application in writing to the Registrar of Companies for compounding of any offence committed under the Companies Act or any other law. The Registrar has the power to compound the offence by imposing a penalty, subject to certain conditions.

      Section 454 of the Companies Act, 2013, provides for adjudication of penalties for certain offences. This section empowers the Registrar or any officer authorized by the Central Government to adjudicate and impose penalties for offences specified in the section. The adjudicating officer is required to follow the procedure prescribed under the Companies Act and give the accused an opportunity to be heard before imposing the penalty.

      22-04-2023 / 10:49:47 AM
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