This article discusses the penalty imposed by the Ministry of Corporate Affairs (MCA) on ULTRAFINE MINERAL & ADMIXTURES PRIVATE LIMITED for receiving an Inter Corporate Deposit before filing the required declaration (INC-20A).
ULTRAFINE MINERAL & ADMIXTURES PRIVATE LIMITED, a registered company under the Companies Act, 2013, violated Section 10A of the Act by receiving an Inter Corporate Deposit before filing the declaration (INC-20A). The company filed the INC-20A form within the stipulated 180 days from its date of incorporation but had received the deposit 10 days prior to filing.
The MCA, after reviewing the application for compounding and considering the violation, initiated the adjudication process under Section 454 of the Companies Act, 2013. It was observed that the company’s filing (SRN R51193563) was done on 24.08.2020, meeting the deadline. However, the company’s receipt of the Inter Corporate Deposit on 14.08.2020 constituted a violation of Section 10A(a) for a period of 10 days.
The Adjudicating Officer has imposed a penalty on ULTRAFINE MINERAL & ADMIXTURES PRIVATE LIMITED and its officers in default for the violation of Section 10A(a) and (b).
GOVERNMENT OF II{DIA
MINISTRY OF CORPORATE AFFAIRS
OFFICE OF THE REGISTRAR OF COMPANIES,
MUMBAI, MAHARASHTRA
100, “EVEREST, MARINE DRIVE, MUMBAI .02
Website: www.mca.gov.in
E-Mail lD: [email protected]
Order No. Roc(M)/RB/ADJ-ORDER/338575/2362/2362B Date: 30/11/2022
ORDER FOR PENALTY UNDER SECTION 454 FOR VIOLATION OF SECTION 10 A OF THE COMPANIES ACT, 2013.
IN THE MATTER OF ULTRAFINE MINERAL & ADMIXTURES PRIVATE LIMITED
(CIN: U24100MH2020PTC338575).
1. Appointment of Adjudicating Officer:‑
Ministry of Corporate Affairs vide its Gazette Notification No.A-42011/112/2014-Acill dated 24.03.2015 appointed the 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.
2. Company:‑
Whereas the Company ULTRAFINE MINERAL & ADMIXTURES PRIVATE LIMITED [herein after known as Company] is a registered company with this office under the provisions of Companies Act, 2013 having its registered address – 76/ IN, MOUZA DONARGAON WARDHA ROAD, NAGPUR, MAHARASHTRA, 441108, INDIA as per the MCA portal.
3. Facts about the Case:‑
The Company has filed application for compounding under section 441 for violation of provisions of Section 10A of the Companies Act, 2013 read with Rule 23A of Companies (The Incorporation) Rules, 2014. Whereas, it has been observed the aforesaid violation is adjudicate pursuant to section 454 of the Companies Act, 2013. Hence, the matter is adjudicated pursuant to section 454 of the Companies Act, 2013. From the application and records of this office, it is observed that the company has filed INC-20A vide SRN R51193563 on 24.08.2020 well within 180 days from the date of Incorporation. However, company has received some amount as Inter Corporate Deposit before filling INC-20A on i.e. 14.08.2020, 10 days prior to filling of INC-20A.
4. Sections 10A is reproduced as under:-
(I) A company incorporated after the commencement of the Companies (Amendment) Ordinance, (2019] and having a share capital shall not commence any business or exercise any borrowing powers unless —
(a) a declaration is filed by a director within a period of one hundred and eighty days of the date of incorporation of the company in such form and verified in such manner as may be prescribed, with the Registrar that every subscriber to the memorandum has paid the value of the shares agreed to be taken by him on the date of making of such declaration; and
(b) The company has filed with the Registrar a verification of its registered office as provided in sub-section (2) of section
(2) If any default is made in complying with the requirements of this section, the company shall be liable to a penalty of fifty thousand rupees and every officer who is in default shall be liable to a penalty of one thousand rupees for each day during which such default continues but not exceeding an amount of one lakh rupees.
(3) Where no declaration has been filed with the Registrar under clause (a) of sub-section (1) within a period of one hundred and eighty days of the date of incorporation of the company and the Registrar has reasonable cause to believe that the company is not carrying on any business or operations, he may, without prejudice to the provisions of sub-section (2), initiate action for the removal of the name of the company from the register of companies under Chapter X11111.]
5. Hearing and reply of the Company:‑
The office of Registrar of Companies Mumbai, Maharashtra, Ministry of Corporate Affairs received an application from the company on 14.09.2021 for compounding of offence pursuant to section 441 for violation of section 10A of the Act. Upon which the aforesaid office took up the matter with the company vide letter dated 01.04.2022 stating that, any violation pursuant to section 10 A of the Act, the company and its officers are liable to be adjudicated under section 454 of the Act and asked the company to file appropriate application for adjudicating violation of section 10A of the Act.
Company then summitted an application to the aforesaid office on 02.05.2022 stating that, the application filed on 14.09.2021 to be considered as Adjudication application pursuant to section 454 of the Act and process the same.
6. Findings and observations: ‑
The company is incorporated on 04.03.2020. In pursuant to section 10A of the Act, company was supposed to file INC-20A on or before 31.08.2020. Company has filed INC-20A vide SRN R51193563 on 24.08.2020 which is before 180 days. However, pursuant to section 10A company shall not commence any business or exercise any borrowing power unless
(a) a declaration is filed by a director within a period of one hundred and eighty days of the date of incorporation of the company in such form and verified in such manner as may be prescribed, with the Registrar that every subscriber to the memorandum has paid the value of the shares agreed to be taken by him on the date of making of such declaration: and
(b) The company has filed with the Registrar a verification of its registered office as provided in sub-section (2) of section
The Company has attached Bank Statement along with INC-20A which clearly shows that the company received Inter Corporate Deposit on 14.08.2020. Hence, company has violated the provision of section 10 A (a) from 14.08.2020 to 23.8.2020. i.e. 10 days.
7. ORDER:‑
a) Having considered the facts and circumstances of the case and after taking into account the factors above, I hereby impose a penalty on the Company and its Officers in default as per table below for violation of provisions of Section 10A(a) & (b) of the Companies Act, 2013 for delay of 10 days. I am of this opinion that, the penalty is commensurate with the aforesaid failure committed by the Notice.
Penalty to be imposed for Violation of Section 10 A(a) of CA, 2013
a) The period of violation of provisions under Section 10A (a) of the Companies Act, 2013 is from 14- 08-2020 till 31-08-2020 delay is 10 days. As per signatory details available on MCA-21 portal, the above-mentioned individuals were Officers in default during the period of violation.
b) The Noticee shall pay the said amount of penalty through “Ministry of Corporate Affairs” portal and proof of payment be produced for verification within 30 days of receipt of this order.
c) Appeal against this order may be filed in writing with the Regional Director (Western Region) within a period of sixty days from the date of receipt of this order in Form ADJ setting forth the grounds of appeal and shall be accompanied by a certified copy of this order.
d) Your attention is also invited to Section 454(8)(ii) of the Companies Act, 2013, where an officer of a company who is in default does not pay the penalty within a period of ninety days from the date of the receipt of the copy of the order, such officer shall be punishable with imprisonment which may extend to six months or with fine which shall not be less than twenty-five thousand rupees but which may extend to one lakh rupees, or with both. Regarding consequences of non-payment of penalty within the prescribed time limit of ninety days from the date of receipt of this order in terms of the provisions of Section 454(8)(i) of the Companies Act, 2013, where Company does not pay the penalty imposed by the adjudicating officer or the Regional Director within a period of ninety days from the date of the receipt of the copy of the order, the company shall be punishable with fine which shall not be less than twenty five thousand rupees but which may extend to five lakh rupees
e) Therefore, in case of default in payment of penalty, prosecution will be filed under Section 454(8)(i) and (ii) of the Companies Act, 2013 at your own costs without any further notice.
(BENUDHAR MISHRA) (I.C.L.S)
Registrar of Companies and Adjudicating Officer,
Maharashtra, Mumbai.
Place :- Mumbai Date :- 30/11/2022.
