ROC Mumbai II passed an adjudication order dated 03.08.2026 under Section 454 of the Companies Act, 2013 for violation of Section 135(7) arising from non-compliance with Section 135(5) by Royal Foodstuffs Limited. The company filed a suo motu adjudication application stating that for FY 2023-24 it had a CSR obligation of ₹34,07,811.65, spent ₹27,00,000, resulting in an unspent amount of ₹7,07,811.65 which was not transferred to a Fund specified in Schedule VII within the prescribed period. Show cause notices were issued, replies were filed citing administrative and procedural delays, and an e-hearing was conducted. During the hearing, the authorised representative stated that the unspent amount had been transferred to the PM CARES Fund on 03.06.2026. The adjudicating officer held that the company and its officers in default were liable for penalty under Section 135(7), noted that the company was not eligible for the benefit of Section 446B, and imposed penalties of ₹14,15,623 on the company and ₹70,781 each on Nilima Avinash Phirke and Shivsharan Hanumantappa Sakkargi, with directions to pay the penalties within 90 days and information regarding the appeal process.
GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
ROC Mumbai II
100, Everest, Marine Drive, Mumbai, Maharashtra, India, 400002
Phone: 022-22812627
E-mail: roc.navimumbai@mca.gov.in
Order ID: PO/ADJ/07-2026/MR/02615 Dated: 03/08/2026
ORDER FOR ADJUDICATION OF PENALTY UNDER SECTION 454 OF THE COMPANIES ACT, 2013 (‘THE ACT’) FOR VIOLATION OF SECTION 135(7) OF THE COMPANIES ACT, 2013.
A. Appointment of Adjudicating Officer:
Ministry of Corporate Affairs vide its Gazette notification number S.O. 698(E) dated 10/02/2026 appointed undersigned as Adjudicating Officer in exercise of the powers conferred by section 454 of the Companies Act, 2013 [herein after known as Act] read with Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.
B. Company details:
In the matter relating to ROYAL FOODSTUFFS LIMITED [herein after known as Company] bearing CIN U51101MH2012PLC239014, is a company registered with this office under the Provisions of the Companies Act, 2013/1956 having its registered office situated at 1505, FAIRMOUNT, SECTOR 17 PALM BEACH ROAD, SANPADA, NAVI MUMBAI THANE THANE THANE MAHARASHTRA INDIA 400705
Individual details:
In the matter relating to NILIMA AVINASH PHIRKE_________
In the matter relating to SHIVSHARAN HANUMANTAPPA SAKKARGI_______
C. Provisions of the Act:
If a company is in default in complying with the provisions of sub-section (5) or sub-section (6), the company shall be liable to a penalty of twice the amount required to be transferred by the company to the Fund specified in Schedule VII or the Unspent Corporate Social Responsibility Account, as the case may be, or one crore rupees, whichever is less, and every officer of the company who is in default shall be liable to a penalty of one-tenth of the amount required to be transferred by the company to such Fund specified in Schedule VII, or the Unspent Corporate Social Responsibility Account, as the case may be, or two lakh rupees, whichever is less
D. Facts about the case:
1. Default committed by the officers in default/noticee – Whereas Registrar of Companies Mumbai-II (hereafter referred to as the ROC) is in receipt of a suo-moto Adjudication application on 02.03.2026 filed by the Company (hereafter referred to as the Applicant) under Section 454 of the Companies Act, 2013 (hereinafter referred to as the Act) for default in compliance of Section 135 (5) of the Act.
Rule 135 (5) of the Act reads as:
The Board of every company referred to in sub-section (1), shall ensure that the company spends, in every financial year, at least two per cent. of the average net profits of the company made during the three immediately preceding financial years 7[or where the company has not completed the period of three financial years since its incorporation, during such immediately preceding financial years], in pursuance of its Corporate Social Responsibility Policy:
Provided that the company shall give preference to the local area and areas around it where it operates, for spending the amount earmarked for Corporate Social Responsibility activities:
Provided further that if the company fails to spend such amount, the Board shall, in its report made under clause (o) of subsection (3) of section 134, specify the reasons for not spending the amount 8[and, unless the unspent amount relates to any ongoing project referred to in sub-section (6), transfer such unspent amount to a Fund specified in Schedule VII, within a period of six months of the expiry of the financial year].
The applicant in adjudication application at para 2 (iv) has stated that is in default by un-spending the required CSR amount of Rupees Thirty-four lakhs seven thousand three hundred and fifty-eight (Rs.34,07,358) for the financial year 2023-24. Upon perusal it is observed the company has not transferred the amount to a Fund specified in Schedule VII, within a period of six months of the expiry of the financial year and thereby defaulted in compliance of section 135 (5) of the Act.
Nilima Avinash Phirke, Whole time Director and Shivsharan Hanumantappa Sakkargi, Managing Director are person in default along with the company and therefore are liable for penalty under section 135 (7) of the Act.
Further, the company is directed to explain as to how the offence has been rectified.
2. The noticees had requested to provide an opportunity to present its submissions through a personal hearing and authorised Mr. Yogesh Choudhary, Practicing Company Secretary (Membership No. F8644), to appear on their behalf and represent them in the above-mentioned proceeding.
E. Order:
1. i. The company had filed a suo-moto adjudication application regarding non-compliance of section 135 (5) of the Companies Act, 2013 wherein it was submitted that during the FY 2023-24, the company was required to spend Rs.34,07,811.65/- towards CSR activities however the amount spent was Rs.27,00,000/- thus resulting in a shortfall of Rs. Rs.7,07,811.65/- which ought to have been transferred to a Fund specified in Schedule VII of the Act within six months of closing of financial year i.e. by 30.09.2023. Further, it is observed that the Company has filed CSR-2 for FY 2023-24 vide SRN N25871476 dated 02.01.2025 wherein the total CSR obligation for the financial year is Rs. 34,07,811.65/-.
ii.The company has failed to comply with these provisions of Section 135(5) rendering company and officers in default liable to penalty under section 135 (7) of the Act.
iii.Pursuant to adjudication application filed by the company, show cause notice dated 22.05.2026 was issued to the company and officers in default through e-adjudication module. The Company and officers in default submitted reply through e-adjudication module on 05.06.2026 stating that the Company, due to certain administrative and procedural delays, was unable to spend the CSR amount within the prescribed timeline as stipulated under Section 135(5) of the Companies Act, 2013.
iv. The company and officers in default opted for e-hearing in the matter and e-hearing notice dated 06.07.2026 was sent to the company and officers in default. E-hearing was scheduled on 08.07.2026 and was attended by Mr. Yogesh Chaudhary, Practicing Company Secretary and authorized representative of the company and officers in default as per adjudication application filed. He submitted that the offence has been made good as company has transferred the amount to PM cares fund on 03.06.2026 with receipt no. PMCARES/HDFC/HGALP03F550582292795.
v. Further, the subject company does not get covered under the purview of small company as defined under section 2 (85) of the Companies Act, 2013. Hence, the benefit of section 446B would not be applicable to the company. Penalty under section 135 (7) is leviable on the company and all its directors as on relevant date of default.
2. The details of penalty imposed on the company, officers in default and others are shown in the table below:
| (A) | Name of person on whom penalty imposed (B) | Rectification of Default required (C) | Penalty Amount (D) | Additional Penalty (E) (*Per day of continuing default i.e. date of rectification of default less order issue date) | Maximum limit for Penalty (F) |
| 1 | ROYAL FOODSTUFFS LIMITED having CIN as U51101MH2012P LC239014 | 1415623 | 0 | 10000000 | |
| 2 | NILIMA AVINASH PHIRKE having DIN as 03621049 | 70781 | 0 | 200000 | |
| 3 | SHIVSHARAN HANUMANTAPP A SAKKARGI having DIN as 03621054 | 70781 | 0 | 200000 |
3. The notified officers in default/noticee shall rectify the default mentioned above and pay the penalty, so applicable within 90 days of receipt of the order.
4. The notified officers in default/noticee shall pay the penalty amount via ‘e-Adjudication’ facility which can be accessed through the respective login IDs on the website of Ministry of Corporate Affairs and upload the copy of paid challan / SRN of e-filing (if applicable) on the ‘e-Adjudication’ portal itself. It is also directed that the penalty so imposed upon the officers in default shall be paid from their personal sources/income.
5. Appeal against this order may be filed in writing with the Regional Director, RD Navi Mumbai within a period of sixty days from the date of receipt of this order, in Form ADJ setting for the grounds of appeal and shall be accompanied by a certified copy of this order [Section 454 (5) & 454 (6) of the Act, read with Companies (Adjudication of Penalties) Rules, 2014].
6. For penal consequences of non-payment of penalty within the prescribed time limit, please refer Section 454(8) of the Companies Act, 2013.
Anannya Saikia,
Registrar of Companies
ROC Mumbai II
