Fraudulent default by Financial Establishment

When a Financial Establishment defaults in return of any deposit on maturity, along with interest, bonus, profit or in any other form as promised, or fails to provide service against the deposit, every person responsible for the management or operation of the business of such Financial Establishment, including promoter, partner, director, manager or any other person or employee, shall, on conviction, be punished with imprisonment for a term which may extend to 10 years and with fine which may extend to Rs. 1,00,000, or where such default is related to the determined amount of money, with a fine of double the amount of default, whichever is higher: Provided that in the absence of special and sufficient reasons to be recorded in the judgement of the court, the imprisonment shall not be less than 3 years and the fine shall not be less than Rs. 50,000. Explanation I - For the purposes of this section, any Financial Establishment which defaults in making repayment as promised, or commits a fraudulent default or fails to provide any service against the deposit for wrongful gain to one person and wrongful loss to another, or due to impractical or commercially unviable promises made at the time of accepting the deposit, or due to default arising from inherent risks of recovery in deployment of funds or assets derived from such deposits, shall be deemed to have committed a fraudulent default or failure. Explanation II - When the question arises whether a Financial Establishment has committed a fraudulent default under this section, the court shall presume that such Financial Establishment has committed a fraudulent default.