Section 109, The Companies Act, 2009

(1) An allotment made by a company to an applicant incontravention of sections 107 and 108, shall be voidable at the instance of the applicant within one month after the holding of the statutory meeting of the company and not later, notwithstanding that the company is in the course of being wound up. (2) If any director of a company knowingly contravenes or permits or authorises the contravention of any of the provisions of sections 107 and 108 with respect to allotment, he shall be liable to compensate the company and the allottee respectively for any loss, damages or costs which the company or the allottee may have sustained or incurred thereby. (3) Proceedings to recover any loss, damages or costs shall not be commenced after the expiration of two years from the date of allotment.