Introduction to Prospect Legal

Prospect Legal is a leading law firm with 15+ years of expertise in forensic investigations, asset recovery, and litigation to combat financial fraud and fund misappropriation. Our multidisciplinary team of attorneys, forensic accountants, and cybersecurity experts specializes in tracing illicit financial flows, securing injunctions, and recovering misused funds under the Companies Act, 2013, Indian Penal Code (IPC), and Prevention of Money Laundering Act (PMLA). Whether pursuing directors for breach of fiduciary duty or unraveling complex embezzlement schemes, we deliver actionable legal strategies to reclaim assets and hold perpetrators accountable.

Where You Can Find Remedies?

Key forums for recovering misappropriated funds include:

• National Company Law Tribunal (NCLT): Adjudicates claims under Section 241-242 (oppression/mismanagement) and Section 447 (fraud).
• Criminal Courts: Prosecute offenders under IPC Sections 406 (Criminal Breach of Trust) and 420 (Cheating).
• Serious Fraud Investigation Office (SFIO): Investigates complex frauds under Section 212 of the Companies Act.
• Debt Recovery Tribunals (DRTs): Enforce recovery of diverted assets under the SARFAESI Act, 2002.

Need to recover misappropriated funds? Contact Prospect Legal to initiate swift legal action and safeguard your assets.

📞 Call us at 7000-12-7225

Understanding the Legal Process

Voluntary Process (Pre-Litigation Resolution):

1. Internal Audit: Identify discrepancies through forensic accounting.
2. Settlement Negotiations: Recover funds via confidential out-of-court settlements.
3. Asset Freeze Agreements: Secure voluntary restraint on suspect accounts/assets.

Compulsory Process (Court-Driven):

1. Filing FIR: Lodge criminal complaints with economic offense wings.
2. NCLT Petition: Seek asset freezing, compensation, or director disqualification.
3. SFIO Investigation: Trigger a statutory probe into fund diversion.
4. Enforcement: Execute recovery via DRTs or PMLA proceedings.

Legal Protection Under Key Provisions

Section 447 of the Companies Act: Punishment for Fraud

• When Can a Claim Be Filed?
  • If misappropriation involves wrongful gain/loss exceeding ₹10 lakh or 1% of turnover.
  • If directors/employees falsify accounts, siphon funds, or abuse fiduciary roles.
  • Upon discovery of fraud within 3 years (limitation period).

Section 406 of the IPC: Criminal Breach of Trust

• Powers of the Adjudicating Authority (Courts):
  • Order restitution of misappropriated funds.
  • Impose imprisonment up to 3 years and/or fines.
  • Attach properties acquired through illicit gains.

Process of Remedy Through Prospect Legal

Step 1: Initial Consultation & Risk Assessment

• Forensic Analysis: Scrutinize bank statements, ledgers, and transactional records.
• Fraud Mapping: Trace fund flows using digital forensics and blockchain analysis.
• Liability Assessment: Identify culpable parties (directors, employees, third parties).
• Strategy Planning: Choose between civil, criminal, or NCLT-driven recovery.

Step 2: Legal Documentation & Filing

• Draft NCLT petitions under Section 241-242 for oppression/mismanagement.
• File FIRs under IPC Sections 406/420 with evidence of misappropriation.
• Submit SFIO complaints for large-scale corporate frauds.
• Prepare asset attachment applications under PMLA or SARFAESI.

Step 3: Compliance & Negotiations

• Negotiate settlements with accused parties for partial/full repayment.
• Represent clients in SFIO interrogations and court hearings.
• Coordinate with banks/financial institutions to freeze suspect accounts.
• Challenge benami transactions to reclaim diverted assets.

Step 4: Resolution & Final Actions

• Secure court orders for restitution, penalties, or imprisonment.
• Enforce asset auctions under SARFAESI or PMLA for recovery.
• Monitor compliance with tribunal directives (e.g., fund repatriation).
• Implement anti-fraud controls (e.g., audits, whistleblower policies).

For expert legal representation, reach out to Prospect Legal now.
📞 Call us at 7000-12-7225