Section 217 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 217 lays out what officers and agents of a company under investigation must do, and what the inspector may do in return. It covers producing books and papers, examination on oath, civil court powers, help from other authorities, evidence from abroad and the penalties for non-cooperation.
Officers, employees and agents (including former ones) must preserve and produce all books and papers and give the inspector reasonable assistance. The inspector may examine on oath, has civil court powers, and may keep books and papers for not more than 180 days at a time. Disobeying a direction is punishable with imprisonment up to one year and a fine of Rs 25,000 to Rs 1 lakh. Refusing to produce, answer or sign is punishable with imprisonment up to six months and a fine of Rs 25,000 to Rs 1 lakh, plus a daily fine. A convicted director is deemed to vacate office and is disqualified from holding office in any company.
The sub-sections at a glance
| Sub-section | What it deals with |
|---|---|
| (1) | Duty of officers, employees and agents (including former) to preserve and produce books and papers and assist |
| (2) | Power to require any other body corporate to furnish information or produce books |
| (3) | Inspector may keep books and papers for not more than 180 days, extendable by a further 180 days by written order |
| (4) | Examination on oath; prior approval needed for persons outside sub-section (1) |
| (5) | Civil court powers under the Code of Civil Procedure, 1908 |
| (6) | Penalty for disobeying directions; vacation of office on conviction |
| (7) | Notes of examination: written, read over, signed, usable as evidence |
| (8) | Penalty for refusal to produce, furnish, appear, answer or sign |
| (9) | Help from Central and State Government, police and statutory authorities |
| (10) | Reciprocal arrangements with foreign States |
| (11)–(12) | Letters of request for evidence in or from other countries |
Duty to produce and assist: sub-section (1)
It is "the duty of all officers and other employees and agents including the former officers, employees and agents of a company which is under investigation" to do two things: to preserve and produce to the inspector, or a person authorised by him, all books and papers of or relating to the company in their custody or power; and otherwise to give the inspector all assistance in connection with the investigation which they are reasonably able to give. The same duty applies to officers, employees and agents of another body corporate or person investigated under section 219.
The reach to former officers and agents is worth noting. Leaving the company does not end the duty to preserve and produce records in your custody.
Other bodies corporate and the 180-day rule
Under sub-section (2) the inspector may require any other body corporate, outside those in sub-section (1), to furnish information or produce books and papers if that is "relevant or necessary" for the investigation. Sub-section (3) then limits how long the inspector may hold them: not more than one hundred and eighty days, after which he must return them to the company, body corporate, firm or individual that produced them. The proviso allows him to call for them again, if needed, for a further period of 180 days by an order in writing.
If you are advising a company that has received a request from an inspector, a legal dispute resolution review early on helps you track what has been handed over and when it is due back.
Examination on oath: sub-sections (4) and (7)
An inspector may examine on oath (a) any person referred to in sub-section (1), and (b) with the prior approval of the Central Government, any other person, and may require them to appear personally. In an investigation under section 212 (the Serious Fraud Investigation Office route), prior approval of the Director, SFIO is sufficient for clause (b).
Sub-section (7) says notes of the examination must be taken down in writing, read over to or by the person examined, and signed, and "may thereafter be used in evidence against him". Read the notes carefully before signing.
Civil court powers: sub-section (5)
Despite anything in any other law or contract, the inspector, "being an officer of the Central Government", has the powers of a civil court under the Code of Civil Procedure, 1908 while trying a suit, for: (a) discovery and production of books of account and other documents at the place and time he specifies; (b) summoning and enforcing attendance and examining on oath; and (c) inspection of any books, registers and documents of the company at any place.
Penalties: sub-sections (6) and (8)
| Default | Punishment |
|---|---|
| Director or officer disobeys a direction issued by the Registrar or the inspector under the section (sub-section (6)(i)) | Imprisonment up to one year and fine of not less than Rs 25,000, up to Rs 1 lakh |
| Conviction under the section | Director or officer deemed to have vacated office from the date of conviction, and disqualified from holding an office in any company (sub-section (6)(ii)) |
| Person fails without reasonable cause, or refuses, to produce a book or paper, furnish information, appear personally, answer a question or sign the examination notes (sub-section (8)) | Imprisonment up to six months and fine of not less than Rs 25,000, up to Rs 1 lakh, and a further fine up to Rs 2,000 for every day after the first during which the failure or refusal continues |
The text of sub-section (6)(ii) does not state a period for the disqualification. It says the director or officer shall, from conviction, be disqualified from holding office in any company. Do not assume a number of years that the section does not give.
Sub-section (8) carries the defence "without reasonable cause". An honest inability to produce a document is treated differently from a refusal.
Help from other authorities and foreign evidence
Sub-section (9) requires officers of the Central Government, State Government, police or statutory authorities to give the inspector assistance for inspection, inquiry or investigation, which he may, with prior approval of the Central Government, require. Sub-section (10) lets the Central Government agree with a foreign State on reciprocal arrangements. Sub-section (11) lets a competent Indian court, on the inspector's application, issue a letter of request to a court or authority abroad for evidence, and any statement or document received is deemed to be evidence collected during the investigation. Sub-section (12) covers the reverse: a foreign request for help may be forwarded to the court, or to an inspector who must report to that court within thirty days or such extended time as the court allows.
Practical examples
Example 1: former accountant. A company is under investigation and its former accountant holds old vouchers. Sub-section (1) makes the duty to preserve and produce applicable to former employees and agents.
Example 2: seized but held too long. An inspector has held a company's books for 200 days with no written order for a further period. Sub-section (3) limits the holding to 180 days unless he has called for them again in writing.
Example 3: refusal to sign. An officer attends but declines to sign the notes of examination. Sub-section (8)(d) makes the refusal, without reasonable cause, punishable.
Need help when an inspector calls?
Being called before an inspector, or asked for books and papers, calls for careful handling of documents and statements. Our team can help you prepare and respond. Start with our legal dispute resolution service.
Key takeaways
- Current and former officers, employees and agents must preserve, produce and assist.
- The inspector may hold books and papers up to 180 days, with one further 180-day call by written order.
- Examination on oath is allowed, and signed notes can be used in evidence.
- Civil court powers apply for discovery, summons and inspection.
- Disobeying a direction: up to one year and Rs 25,000 to Rs 1 lakh.
- Refusing to produce, answer or sign: up to six months, Rs 25,000 to Rs 1 lakh, plus up to Rs 2,000 a day.
Read next
- Powers of Inspectors During Company Investigation
- Section 216 of the Companies Act, 2013: Investigation of ownership
- Section 218 of the Companies Act, 2013: Protection of employees during investigation
- Section 219 of the Companies Act, 2013: Investigation of related companies
Disclaimer: Based on the Companies Act, 2013 as amended up to 1 April 2021 (official consolidated text), read with later developments noted in the article; proposals in the Corporate Laws (Amendment) Bill, 2026 are pending and not law as on 30 September 2026. Verify current notifications and rules before acting.