(1) If, on an investigation under any other Part or where a company is wound up, it is shown that proper books of account were not kept by the company throughout the period of two years immediately preceding the commencement of the investigation or the winding up or the period between the incorporation of the company and the commencement of the investigation or winding up, whichever is the lesser, every officer, commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding three years or to a fine not exceeding five hundred thousand ringgit or to both.
(2) For the purposes of this section, proper books or accounts shall be deemed not to have been kept in the case of any company if—
\(a\) the books or accounts have not been kept as are necessary to exhibit and explain the transactions
and financial position of the trade or business of the company, including books containing entries from
day to day in sufficient detail of all cash received and cash paid, and, where the trade or business has
involved dealings in goods, statements of the annual stock takings and, except in the case of goods
sold by way of ordinary retail trade, of all goods sold and purchased, showing the goods and the buyers
and sellers of the goods in sufficient detail to enable those goods and those buyers and sellers to be
identified; or
\(b\) the books or accounts have not been kept in such manner as to enable the books or accounts to be
conveniently and properly audited, whether or not the company has appointed an auditor.
(3) If in the course of winding up of a company or in any proceedings against a company, an officer of the company who knowingly was a party to the contracting of a debt had, at the time the debt was contracted, no reasonable or probable ground of expectation, after taking into consideration the other liabilities, if any, of the company at the time, of the company being able to pay the debt, commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding five years or to a fine not exceeding five hundred thousand ringgit or to both.