Section 447 — Punishment for fraud

Without prejudice to any liability including repayment of any debt under
this Actor any other l aw for the time being in force, any person who is found to be guilty of fraud,
1[involving an amount of at least ten lakh rupees or one per cent. of the turnover of the company, whichever
is lower] shall be punishable with imprisonment for a term which sha ll 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:
Provided that where the fraud in question involves public interest, the term of imprisonment shall not
be less than three years.
2[Provided further that where the fraud involves an amount less than ten lakh rupees or one per cent. of
the turnover of the company, whichever is lower, and does not involve public interest, any person guilty of
such fraud shall be punishable with imprisonment for a term which may extend to five years or with fine
which may extend to 3[fifty lakh rupees] or with both.]
Explanation.—For the purposes of this section—
(i) “fraud”, in relation to affairs of a company or any body corporate, includes any act, omission,
concealment of any fact or abuse of position committed by any person or any other person with the
connivance in any manner, with intent to decei ve, to gain undue advantage from, or to injure the
interests of, the company or its shareholders or its creditors or any other person, whether or not there is
any wrongful gain or wrongful loss;
(ii) “wrongful gain” means the gain by unlawful means of property to which the person gaining is
not legally entitled;
(iii) “wrongful loss” means the loss by unlawful means of property to which the person losing is