Sections 36 to 38 of Companies Act 2013

Section 36.

Punishment for fraudulently inducing persons to invest money.

Any person who, either knowingly or recklessly makes any statement, promise or forecast which is false, deceptive or misleading, or deliberately conceals any material facts, to induce another person to enter into, or to offer to enter into,—

(a)    any agreement for, or with a view to, acquiring, disposing of, subscribing for, or underwriting securities; or

(b)   any agreement, the purpose or the pretended purpose of which is to secure a profit to any of the parties from the yield of securities or by reference to fluctuations in the value of securities; or

(c)    any agreement for, or with a view to obtaining credit facilities from any bank or financial institution,

shall be liable for action under section 447.

Section 37.

Action by affected persons.

 A suit may be filed or any other action may be taken under section 34 or section 35 or section 36 by any person, group of persons or any association of persons affected by any misleading statement or the inclusion or omission of any matter in the prospectus.

Section 38.

Punishment for personation for acquisition, etc., of securities.

(1)    Any person who—

(a)    makes or abets making of an application in a fictitious name to a company for acquiring, or subscribing for, its securities; or

(b)   makes or abets making of multiple applications to a company in different names or in different combinations of his name or surname for acquiring or subscribing for its securities; or

(c)    otherwise induces directly or indirectly a company to allot, or register any transfer of, securities to him, or to any other person in a fictitious name,

            shall be liable for action under section 447.

(2)    The provisions of sub-section (1) shall be prominently reproduced in every prospectus issued by a company and in every form of application for securities.

(3)    Where a person has been convicted under this section, the Court may also order disgorgement of gain, if any, made by, and seizure and disposal of the securities in possession of, such person.

(4)    The amount received through disgorgement or disposal of securities under subsection (3) shall be credited to the Investor Education and Protection Fund.