Failure to include DIN in documents summitted with ROC: MCA levied Penalty

On July 8, 2024, the Registrar of Companies in Karnataka issued an adjudication order imposing penalties on Siply Services Private Limited for violating Section 158 of the Companies Act, 2013. The company failed to include the Director Identification Number (DIN) in required documents submitted between June 20, 2023, and January 17, 2024. This lapse led to a penalty of ₹1,55,500 for the company and ₹1,00,000 for its director, Sousthav Chakraborty. The company had submitted incomplete responses to adjudication notices, and despite being given multiple opportunities to address the non-compliance, no satisfactory resolution was provided. The penalties must be paid within 90 days, and any appeals must be filed within 60 days of receiving the order. Non-compliance with this order may result in further penalties under Section 454(8) of the Act. The company is required to notify its directors of the penalty order.

Government of India
Ministry of Corporate Affairs
Registrar of Companies, Karnataka
Kendriya Sadan, 2^nd Floor, ‘E’ Wing,
Koramangala, Bengaluru – 560 034
Phone : 080-25537449/25633105
E-mail ID : [email protected]

File No. ROC(B)/Adj.Ord.454-158/Siply Servies/Co.No.136118/2024/ Date:08.07.2024

ORDER OF ADJUDICATION OF PENALTY UNDER SECTION 454 OF COMPANIES ACT, 2013 READ WITH RULE 3 OF THE COMPANIES (ADJUDICATION OF PENALITES) RULES, 2014 FOR VIOLATION OF PROVISIONS OF SECTION 158 OF THE COMPANIES ACT, 2013 BY SIPLY SERVICES PRIVATE LIMITED

Ministry of Corporate Affairs vide its Gazette Notification No. A-42011/112/2014-Ad.II dated 24.03.2015 has appointed the undersigned as Adjudicating Officer in exercise of the powers conferred by section 454 of the Companies Act, 2013 (hereinafter referred to as Act) read with Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of Companies Act, 2013.

2. The company, Siply Services Private Limited (hereinafter referred to as Company) having CIN U74999KA2020PTC136118 was incorporated on 18.07.2020 and is presently registered under the jurisdiction of Registrar of Companies, Karnataka and the registered office of the company is situated at Vaishnavi Signature, 78/9, Outer Ring Road, Bellandur Village, Varthur Hobli, Bengaluru South, Karnataka — 560103.

3. An online complaint was received against the company from Mr. Karthik, a debenture holder of the company which was taken up with the company. It has been observed while examining the replies dated 20.06.2023 and 13.09.2023 submitted by the company, that the same were furnished without compliance of section 158 of the Act i.e. without mentioning the DIN of the director. The letter dated 13.09.2023 did not even have the name of the authorised signatory, which was later accepted by the company to be its director. Thus, the provisions of section 158 of the Act have been violated rendering the company and every officer in default are liable for penal action.

4. As per section 158 of the Act, every person or company, while furnishing any return, information or particulars as are required to be furnished under this Act, shall mention the Director Identification Number in such return, information or particulars in case such return, information or particulars relate to the director or contain any reference of any director.

5. As per section 172 of the Act, if a company is in default in complying with any of the provisions of this chapter and for which no specific penalty or punishment is provided therein, the company and every officer of the company who is in default shall be liable to a penalty of fifty thousand rupees, and in case of continuing failure, with a further penalty of five hundred rupees for each day during which such failure continues, subject to a maximum of three lakh rupees in case of a company and one lakh rupees in case of an officer who is in default.

6. Pursuant to the above, adjudication notice dated 12.01.2024 was issued to the company and its directors. In response to the said adjudication notice, the company vide its letter dated 18.01.2024 furnished its reply, wherein it was stated that the letter dated 13.09.2023 was signed by Mr. Sousthav Chakraborthy, the director of the company. However, due to inadvertence, the words “Authorised Representative” was mentioned below the signature of Mr. Sousthav Chakraborthy without his DIN and other details and requested this office not to take further action in the matter.

7. As the reply furnished by the company was not satisfactory and company had accepted its non-compliance, further adjudication proceedings were initiated in this case. An adjudication hearing notice was sent to the company on 01.03.2024 for a hearing on 12.03.2024 which was attended by Mr. Vivek S, Advocate, Invite Chambers who appeared on behalf of the company and placed his submissions before the adjudicating officer. However, since there was no representation on the part of the other directors, one more opportunity was provided to hear the matter again on 21.05.2024 by issuing notices to company and directors on 03.05.2024. This hearing was attended by Mr. Ronald Philips, Advocate, Invite Chambers on behalf of the company who submitted copy of the letter dated 18.01.2024 to the adjudicating officer and pleaded not to impose any penalty as it was an inadvertent error and asserted that the signatures belong to Mr. Sousthav Chakraborthy, the director of the company. The authorised representative was asked to give copy of letters issued during the period for ascertaining the duration of non-compliance by the company. Since no reply has been received either by the company, director, or authorised representative, the proceeding has been continued as enough opportunities have been provided in the case.

8. It is noticed that the company has not been complying with the provisions of section 158 of the Act and has accepted that there has been non-compliance. However, to ascertain the duration of default, the company was asked to submit copies of any communication or return filed by the company which was in accordance with section 158 of the Act. However, despite two hearings and ample time provided, no reply has been submitted by the company or any director. There are multiple letters i.e. dated 20.06.2023 and 13.09.2023 which are in violation of section 158 of the Act, and hence this cannot be construed to be a one-off offence. The company has been non-compliant of this provision, and has only sent a reply letter dated 18.01.2024 to the adjudication notice with the name and DIN of the signatory. On the other hand, another letter of same date has been submitted as a response to section 206(1) of the Act which, although containing DIN does not have the name of the signatory mentioned. Thus, the company and Mr. Sousthav Chakraborthy, the director of the company who has signed all the above mentioned letters have violated the provisions of section 158 of the Act for a duration of 212 days i.e. from 20.06.2023 to 17.01.2024 rendering them liable for action under section 172 of the Act.

8. Therefore, having considered the facts and circumstances of the case and the submissions made by the company / director / key managerial personnel through their authorised representative, in view of the above said violation of non-compliance of provisions of section 158 of the Act, I do hereby impose penalty in the following manner on the company and all the officers in default during the period of offence committed:

9. The company and its directors / key managerial personnel are hereby directed to pay the penalty amount as tabulated above within 90 days from the date of receipt of this Order and file Form INC-28 attaching a copy of the Order and payment challans. In case of directors, such penalty amount is required to be paid out of their own funds. The noticee shall pay the said amount of penalty online by using the website mca.gov.in (Miscellaneous head) specifying the details of this Order and the noticee who is paying the penalty.

10. Appeal, if any, against this Order may be filed with the Regional Director (South East Region), Hyderabad within a period of 60 days from the date of receipt of this Order in Form ADJ setting forth the grounds of appeal and shall be accompanies by a certified copy of this Order.

11. Your attention is also invited to section 454(8) of the Companies Act, 2013 in case of non-compliance of this Order wherein necessary penal action will be initiated under 454(8)(i) and (ii) of the Companies Act, 2013 against the company and directors / key managerial personnel without further notice in the matter.

12. The company is required to serve a copy of this Order on the director(s)/ officer(s)-in- default mentioned above in terms of provisions of section 20 of the Companies A , 2013.

Sanjay Sood)
Registrar of Companies, Karnataka
and Adjudicating Officer