Introduction to Prospect Legal

Prospect Legal is a leading regulatory compliance and litigation firm with 15+ years of expertise in defending businesses against punitive fines imposed by authorities like SEBI, RBI, NCLT, and GST Council. Our team of seasoned attorneys specializes in dissecting regulatory allegations, identifying procedural lapses, and leveraging statutory safeguards under laws such as the Companies Act, 2013, FEMA, and GST Act to mitigate or overturn penalties. From drafting appeals to negotiating settlements, we protect clients from financial losses and reputational harm while ensuring compliance with evolving regulatory frameworks.

Where You Can Find Remedies?

Key forums for challenging regulatory fines include:

• National Company Law Tribunal (NCLT): Adjudicates penalties under Section 454 of the Companies Act.
• SEBI Securities Appellate Tribunal (SAT): Appeals against SEBI orders under Section 15T of the SEBI Act.
• High Courts: Judicial review of penalties via writ petitions under Article 226 of the Constitution.
• GST Appellate Tribunal (GSTAT): Challenges GST-related fines under Section 112 of the CGST Act.

Facing a hefty regulatory penalty? Contact Prospect Legal to explore your legal options and minimize liabilities.

📞 Call us at 7000-12-7225

Understanding the Legal Process

Voluntary Process (Pre-Litigation Resolution):

1. Internal Audit: Identify non-compliance and rectify gaps before penalties escalate.
2. Compounding Applications: Seek penalty reduction via compounding under Section 441 of the Companies Act.
3. Settlement Talks: Negotiate with regulators for reduced fines based on voluntary disclosures.

Compulsory Process (Appeal-Driven):

1. Filing Appeal: Submit appeals to SAT, NCLT, or GSTAT within statutory deadlines (e.g., 45 days for SEBI orders).
2. Stay Orders: Obtain interim relief to suspend penalty enforcement during proceedings.
3. Final Hearing: Present evidence of procedural errors, bona fide mistakes, or disproportionality.
4. Compliance Post-Order: Implement corrective measures mandated by tribunals.

Legal Protection Under Key Provisions

Section 454 of the Companies Act: Penalties for Non-Compliance

• When Can a Claim Be Filed?
  • If penalties are imposed without a 21-day notice or opportunity to respond.
  • If fines exceed statutory limits (e.g., ₹2 lakh/day for continuing defaults).
  • If the violation arose from force majeure or third-party errors.

Section 129 of the CGST Act: Appeals to GSTAT

• Powers of the Adjudicating Authority (GSTAT):
  • Waive or reduce penalties if taxpayers prove “reasonable cause” for non-compliance.
  • Order refunds of wrongly collected fines with interest.

Process of Remedy Through Prospect Legal

Step 1: Initial Consultation & Risk Assessment

• Penalty Review: Scrutinize penalty notices for procedural flaws or jurisdictional errors.
• Document Audit: Analyze compliance records, audit reports, and regulator correspondence.
• Strategy Planning: Choose between compounding, appeals, or writ petitions.
• Cost-Benefit Analysis: Estimate potential savings vs. litigation costs.

Step 2: Legal Documentation & Filing

• Draft appeal memorandums citing grounds like mens rea absence or disproportionality.
• File stay applications to halt penalty recovery during proceedings.
• Prepare compounding petitions under Section 441 with rectification evidence.
• Submit writ petitions for constitutional violations (e.g., arbitrary fines).

Step 3: Compliance & Negotiations

• Negotiate with regulators for reduced fines via settlement schemes.
• Represent clients in tribunal hearings to demonstrate compliance efforts.
• Rectify non-compliance (e.g., filing overdue GST returns) to strengthen cases.
• Coordinate with forensic auditors to refute allegations of intentional wrongdoing.

Step 4: Resolution & Final Actions

• • Secure tribunal orders quashing or reducing penalties.
  • Implement corrective measures (e.g., internal compliance training).
  • Monitor post-resolution compliance to avoid repeat violations.
  • Recover wrongfully collected fines via enforcement petitions.

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