Jay Capitals Ltd. is a non-banking finance company (NBFC), incorporated under the Companies Act, 2013 and has got the license to operate as NBFC from the Reserve Bank of India (RBI). Prachi, who belongs to the promoter g

According to Section 2(60)(v) of the Companies Act, 2013 , an "officer who is in default", for the purpose of any provision in this Act which enacts that an officer of the company who is in default shall be liable to any penalty or punishment by way of imprisonment, fine or otherwise, means the following officers of a company, namely: Any person in accordance with whose advice, directions or instructions the Board of Directors of the company is accustomed to act, other than a person who gives advice to the Board in a professional capacity. In the given situation, although Prachi is not occupying any official position in Jay Capitals Ltd. (a non-banking finance company) on papers, the Board of the company was accustomed to act as per her verbal instructions. This indicates that the Board was acting under her direction and influence. Hence, the status of Prachi can be considered that of an "Officer in default" in terms of Section 2(60)(v) of the Act, even though she is debarred from holding a formal position. Consequently, she can be held liable for her acts and the consequences arising from them.