Details of Sexual Harassment of women at workplace not disclosed in Directors Report: MCA imposes Penalty of Rs. 4 Lakh Penalty
The Ministry of Corporate Affairs (MCA), through its Registrar of Companies (ROC) in Chennai, has adjudicated penalties against M/s Janaki Ram Steel and Power Private Limited under Section 134 of the Companies Act, 2013. This order addresses the non-compliance observed in the company’s Board Reports for the financial years 2015-16 to 2019-20, specifically the failure to disclose details of sexual harassment policies as mandated by Rule 8(5)(x) of the Companies (Accounts) Rules, 2014.
M/s Janaki Ram Steel and Power Private Limited, CIN: U27101TN2004PTC052868, is a registered entity under the Companies Act, 2013. The company, based in Chennai, Tamil Nadu, holds an active status with a paid-up capital of Rs. 18,74,96,870/- as of FY 2021-22, generating substantial revenue from operations.
Violation and Penal Provisions
According to Section 134 of the Companies Act, 2013, every Board Report must include a statement on compliance with provisions related to the constitution of the Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013. Rule 8(5)(x) of the Companies (Accounts) Rules, 2014, stipulates the same for companies with a paid-up share capital of Rs. 25 crore or more.
Inspection and Notice
An inspection of the company’s books and accounts under Section 206(5) of the Companies Act, 2013, revealed the omission of this crucial disclosure in the Board Reports for the years 2015-16 to 2019-20. Consequently, an adjudication notice was issued to the company and its directors on 01.12.2023.
Company’s Response
Pramod Singh, one of the directors, responded with an adjudication application, arguing that the company had complied with the disclosure requirements for the financial year 2019-20. However, the company’s paid-up capital of Rs. 18 crores disqualified it from being considered a small company, negating the application of lesser penalties.
Adjudication Hearing
The hearing on 06.02.2024 featured representations from the company’s counsel, asserting compliance for FY 2019-20 and requesting leniency for previous years. Despite these representations, the Adjudicating Officer upheld the non-compliance findings for FY 2018-19.
Decision and Penalty
The Adjudicating Officer imposed the following penalties:
- Company: Rs. 3,00,000/-
- Directors (Ramchander Singh and Pramod Singh): Rs. 50,000/- each
The total penalty amounted to Rs. 4,00,000/- for the violation of Section 134 of the Companies Act, 2013, for FY 2018-19. The penalties are to be paid online within 90 days, with proof of payment to be submitted to the ROC.
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GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
OFFICE OF REGISTRAR OF COMPANIES, TAMIL NADU, ANDAMAN & NICOBAR ISLANDS, CHENNAI
II FLOOR, C- WING, SHASTRI BHAVAN, 26, HADDOWS ROAD, NUNGAMBAKKAM, CHENNAI- 6
F.NO.ROC/CHN/ JANAKI RAM/ADJ/S.134/2024 DATE: 30 APR 2024
ADJUDICATION ORDER UNDER SECTION 134 OF THE COMPANIES ACT, 2013 READ WITH
RULE 8(5)(x) OF THE COMPANIES (ACCOUNTS) RULES, 2014
IN THE MATTER OF M/S JANAKI RAM STEEL AND POWER PRIVATE LIMITED
1. Appointment of Adjudicating Officer:-
Ministry of Corporate Affairs vide its Gazette Notification No. A-42011/112/2014-Ad.II, dated 24.03.2015 has appointed Registrar of Companies, Chennai as Adjudicating Officer in exercise of the powers conferred by section 454(1) of the Companies Act, 2013 (hereinafter referred as Act or Companies Act, 2013) r/w Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.
2. Company: –
Whereas the company viz M/s. JANAKI RAM STEEL AND POWER PRIVATE LIMITED with CIN: U27101TN2004PTC052868 (herein after referred as ‘ company’ or ‘ subject company’) is a registered company with this office under the Companies Act, 2013 having its registered office as per MCA21 Registry at No.117, Sadayan Kuppam Village Road, ‘Manali, Chennai, Tamil Nadu 600103. The financial & other details of the subject company as available on MCA-21 portal is stated as under:
| S.No. | Particulars | Details |
| 1. | Company’s Status | Active |
| 2. | Filing Status | Financial Statement: Up to 31.03.2022 Annual Return: Up to 31.03.2022. |
| 3. | Paid up Capital (as per FY 2021-22) | Rs.18,74,96,870/- |
| a. Revenue from Operation | Rs.73,75,32,220/- | |
| b. Other Income | Rs.2,31,92,580/- | |
| c. Profit for the Period | Rs.4,00,01,290/- | |
| 4. | Whether it is a Holding Company | No |
| 5. | Whether it is a Subsidiary Company | No |
| 6. | Whether company registered under Section 8 of the Act? | No |
| 7. | Whether company is a small company? | No |
| 8. | Whether company registered under any other special Act? | No |
3. Directors during the period of violation:
| S.No. | Name of Director Default | Designation | Date of Appointment | Date of Cessation |
| 1. | Ramchander Singh |
Director | 01.04.2004 | ….. |
| 2. | Pramod Singh | Director | 01.04.2004 | ….. |
4. Section and Penal Provision as per Companies Act, 2013
Section 134. Financial Statement, Board’s Report, etc.
(3) There shall be attached to statements laid before a company in general meeting, a report by its Board of Directors,
Rule 8(5)(x) of the Companies (Accounts) Rule, 2014: Matters to be Included in Board’s Report
(4) Every listed company and every other public company having a paid up share capital of twenty five crore rupees or more calculated at the end of the preceding financial year shall include, in the report by its Board of directors, a statement indicating the manner in which formal annual evaluation has been made by the Board of its own performance and that of its committees and individual directors.
(5) In addition to the information and details specified in sub-rule (4), the report of the Board shall also contain –
(x) a statement that the company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 114 of 20131
(8) If a company is in default in complying with the provisions of this section, the company shall be liable to a penalty of three lakh rupees and every officer of the company who is in default shall be liable to a penalty of fifty thousand rupees.
5. Issue of Adjudication Notice:
An Inspection of Books and Accounts of the company M/s. Janaki Ram Steel and Power Private limited was carried out U/s 206(5) of the Companies Act, 2013 by an Officer authorized by the Central Government wherein the observations of the Inspecting Officer are as follows:
During the course of Inspection, it is observed that, the Board Report for the financial years 2015-16 to 2019-20 not disclosed the details of Sexual Harassment of women at workplace under (Prevention, Prohibition and Redressal) Act,2013. Hence, the company has violated Section 134 of the Companies Act, 2013 r/w. Rule 8(5)(x) of the Companies (Accounts) Rules, 2014 and the company and every officer in default are liable for penal action under Section 134(8) of the Companies Act, 2013.
After that the Adjudicating Authority has issued Adjudication Notice to the company and its directors vide Notice No. Roc/Chn/052868/Janaki ram steel/S.134/P.19/Inspn.fol.up/2022-23 dated 01.12.2023.
6. Reply of Company and Directors for Adjudication Notice issued:
Pursuant to the Adjudication notice dated 01.12.2023, Shri. Pramod Singh one of the directors of the company has submitted Adjudication application in eform GNL -1 vide SRN: F895584312 dated 05.01.2024 and also submitted physical application in this regard.
7. Adjudication Hearing:
(i) On receipt of the Adjudication application, the Adjudicating Authority had issued notice for hearing dated 25.01.2024 by fixing the hearing on 06.02.2024 at 11:30 AM. Pursuant to the notice dated 25.01.20’24, Shri. H.P.Nitesh, Company Secretary in Practice has appeared before the Adjudicating Authority on 06.02.2024 and made submissions that Rule 8(5)(x) of the Companies (Accounts), Rules 2014 was effective from 31.07.2018. Further, the company has provided the disclosure as required under Rule 8(5)(x) of the Companies (Accounts) Rules, 2014 for the FY 2019-20. Therefore, action may be dropped for the FYs 2015-16,2016-17,2017-18 & 2019-20.
(ii) The company is having paid up capital of Rs.18 Crores, does not fall under the definition of small company as per provision of section 2(85) of the companies Act, 2013. Therefore, of imposing the provision lesser penalty as per section 446(b) shall not be applicable in this case.
8. Decision
Having considered the facts and circumstances of the case and after taking into account the factors above, it is concluded that the company and its directors/Officers have failed to provide the disclosure under Rule 8(5)(x) of the Companies (Accounts),Rules, 2014 for the FY 2018-19 and therefore the company and its Officers in default are liable for penalty as prescribed under Section 134(8) of the Companies Act,2013.
Accordingly, I am inclined to impose a ‘penalty as prescribed under Sub-section 8 of Section 134 of the Companies Act, 2013. The details of the penalty imposed on the company and officers in default are shown in the table below:
I. FY 2018-19
| S.No | Company and Officers in default | Penalty for default (Rs.) | Maximum Penalty (Rs.) |
Final Penalty Imposed (Rs.) |
| 1. | M/s. Janaki Ram Steel and Power Private Limited | Rs.3,00,000/- | Rs.3,00,000/- | Rs.3,00,000/- |
| 2. | Ramchander Singh | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 3. | Pramod Singh | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
Therefore, in view of the above said violation, in exercise of the powers vested to the undersigned under Section 454(1) & (3) of the Companies Act, 2013 a penalty of Rs.3,00,000/- (Rupees Three lalch) is imposed on the Company and Rs.50,000/- (Rupees Fifty Thousand) is imposed on each Officers in default. Totally Rs. 4,00,000/- (Rupees Four lakhs thousand) as penalty amount for violation of Section 134 of the Companies Act, 2013 for the FY 2018-19.
9. The said amount of penalty shall be paid through online by using the website mca.gov.in(Misc. head) within 90 days of receipt of this order, and intimate this office with proof of penalty paid.
10. Whereas Appeal against this order may be filed with the Regional Director (SR), Ministry of Corporate Affairs, 5th Floor, Shastri Bhavan, 26 Haddows Road, Chennai-, 600006, Tamil Nadu within a period of sixty days from the date of receipt of this order, in Form ADJ [available on Ministry website mca.gov.in] setting forth 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 (Adjudicating of Penalties) Rules, 2014].
11. Your attention is also invited to section 454(8) of the Act in the event of non-compliance of this order, “(8)(i) Where company fails to comply with the order made under subsection (3) or sub-section (7), as the case may be 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.
(ii) Where an officer of a company or any other person who is in default fails to comply with the order made under sub-section (3) or sub-section (7), as the case may be 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.”
(B. SRIKUMAR, ICLS)
REGISTRAR OF COMPANIES
TAMILNADU, CHENNAI.
ADJUDICATING OFFICER
