Chapter VII - Management and Administration
Section 99
Section 99: punishment for default under sections 96 to 98
Section 99 is the punishment provision for failing to hold an annual general meeting or a Tribunal-ordered meeting, or failing to comply with the Tribunal’s directions.
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This article is for general information. Refer to the Companies Act, 2013 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
If any default is made in holding a meeting of the company in accordance with section 96 or section 97 or section 98 or in complying with any directions of the Tribunal, the company and every officer of the company who is in default shall be punishable with fine which may extend to one lakh rupees and in the case of a continuing default, with a further fine which may extend to five thousand rupees for every day during which such default continues.
Introduction
The company and every officer in default are punishable with a fine of up to one lakh rupees. A continuing default adds a fine of up to five thousand rupees for every day it continues.
Section 99 came into force on 1 June 2016 under S.O. 1934(E). Unlike many provisions changed in 2019 and 2020, it remains a fine, imposed on prosecution, not a penalty adjudicated under section 454.
Key takeaways
Covered defaults
Default in holding a meeting in accordance with section 96, 97 or 98, or in complying with any directions of the Tribunal.
Who is liable
The company and every officer of the company who is in default.
Amount
Fine up to one lakh rupees, plus up to five thousand rupees a day for a continuing default.
Defaults covered
Section 99 applies where a company defaults in holding a meeting in accordance with section 96 (annual general meeting), section 97 (Tribunal-called AGM) or section 98 (Tribunal-ordered other meetings), or in complying with any directions of the Tribunal.
Punishment
The company and every officer in default are punishable with a fine which may extend to one lakh rupees. For a continuing default, a further fine of up to five thousand rupees applies for every day the default continues. These are maximums; the court fixes the amount.
Practical preparation
Diary the AGM deadline under section 96. Where the Tribunal has issued directions under section 97 or 98, record each direction and how it was complied with. If a default has occurred, take advice promptly on regularising it, including whether compounding under the Act is available.
Practical checklist
Do
- Track AGM deadlines and Tribunal directions in a compliance calendar.
- Record compliance with each Tribunal direction.
Avoid
- Do not assume an AGM default is only a filing issue; section 99 creates criminal liability.
- Do not let a default continue; the daily fine accrues.
Illustrative example
Hypothetical: AGM not held
A company fails to hold its AGM within the time under section 96 and does not hold it for several months.
Exposure
The company and officers in default face a fine of up to one lakh rupees.
Continuing
Up to five thousand rupees may be added for each day the default continues.
Remedy
The company holds the AGM, or a member applies under section 97.
Outcome
- Holding the meeting promptly stops the continuing default.
Glossary
- Officer in default
- An officer of the company who is in default, as defined in section 2(60).
- Continuing default
- A default that persists after the first day, attracting the daily fine.
Frequently asked questions
Is section 99 a penalty or a fine?
A fine. The text says "punishable with fine", which is imposed by a court on prosecution.
Does it cover Tribunal directions?
Yes. Default in complying with any directions of the Tribunal is covered.
Need help applying this provision to your situation?
Contact BizeneedLast updated 11 October 2026