Introduction: The Ministry of Corporate Affairs (MCA) recently issued penalties against M/s PEOPLES INTERNATIONAL & SERVICES PRIVATE LIMITED and its officers for violations regarding the serial numbering and authentication of board meeting attendance sheets. This article provides a comprehensive analysis of the case and the penalties imposed.
Detailed Analysis: The case stemmed from an inspection revealing irregularities in the attendance sheets of board meetings for the financial years 2015-16, 2016-17, and 2017-18. Specifically, the sheets were found to be unnumbered and lacked authentication by the Chairman or Company Secretary, violating Secretarial Standard-1 and Section 118(10) of the Companies Act, 2013. Despite the issuance of show cause notices and subsequent inquiries, the company’s responses were deemed unsatisfactory.
The adjudicating officer, after careful consideration, imposed penalties as follows:
- Company: Rs. 25,000/-
- Directors:
-
- Shri Suresh Narayan Vijay: Rs. 5,000/-
- Mrs. Urmila Devi Vijay: Rs. 5,000/-
- Shri Ishtiaq Hussain Siddiqui: Rs. 5,000/-
- Ex-Company Secretary, Ms. Ruchita Prabhulal Jais: Rs. 5,000/-
These penalties were deemed commensurate with the severity of the violations. It was further directed that penalties be paid through the Ministry of Corporate Affairs portal.
Conclusion: The imposition of penalties underscores the importance of adhering to statutory requirements regarding the maintenance of board meeting attendance records. Companies and their officers must ensure compliance with relevant regulations to avoid financial repercussions and legal consequences.
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GOVERNMENT OF INDIA
MINISTRY OF CORPORATE, AFFAIRS
Office of The Registrar of Companies, Madhya Pradesh
Sanjay Complex, ‘A’ Block, 3rd Floor,
Jayendraganj, Gwalior— 474009.
E-mail: www.roc.gwalior@mca.gov.in
Order No. ROC-Gwalior/Adj-Penalties/Order/S.118 (10)/2021/1755 to 1760 Dated 5 FEB 2021
In the matter of Companies Act, 2013
And
In the matter of adjudication proceeding under Sub-section (10) of section 118
of the Companies Act, 2013.
And
In the matter of Mis PEOPLES INTERNATIONAL & SERVICES PRIVATE LIMITED
(CIN No U45200MP2008PTCO20956)
1. M/s PEOPLES INTERNATIONAL & SERVICES PRIVATE LIMITED
Project Office, People’s Campus, Karond-Bhanpur, Bye-pass,
Village Raslakhedi, Tahsil, Huzur, Bhopal, 462010,
Madhya Pradesh, India.
2. Shri Suresh Narayan Vijay, (Director)
3. Mrs Urmila Devi Vijay (Director)(From 06.08.2015 to 31.12.2018)
4. Shri Ishtiaq Hussain Siddiqui, (Director)(From 06.08.2015)
5. Ms Ruchita Prabhulal Jais (Ex- Company Secretary) (From 15.03.2016 to 15.11.2018)
…… Respondent
Date of Hearing: 04th of February, 2021
Appointment of Adjudicating Officer
1. The Ministry of Corporate Affairs vide its gazette notification no OS.831(E) dated 24.03.2015, has appointed the undersigned as Adjudicating Officer(AO) in exercise of the powers conferred by section 454 of the Companies Act, 2013 (hereinafter known as Act) read with Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.
Company
2. Whereas, M/S PEOPLES INTERNATIONAL & SERVICES PRIVATE LIMITED (herein after referred to as “company”) is a company having its Registered office at Project Office, People’s Campus, Karond-Bhanpur, Bye-pass, Village Raslakhedi, Tahsil, Huzur, Bhopal, Madhya Pradesh, 462010, registered under the provisions of the Companies Act, 1956 (hereinafter referred to as “Act”) in the state of Madhya Pradesh.
Facts of the case
3. Whereas during the inspection of books of accounts and Statutory Registers of the company, it is observed by the JO from Attendance sheet of Board Meeting for the financial year 2015-16, 2016-17 and 2017-18 that it is not serially numbered and also entries in the attendance register not authenticated by Chairman or Company Secretary as required under Secretarial Standard-1 read with Section 118(10) of the Companies Act, 2013. Therefore, the provisions of the Section 118 (10) of the Act, have been contravened and every officer of the company who is in default as the case may be, have rendered themselves liable for penal provisions u/s 118 (11) of the Act. Subsequently, this office had issued Show Cause Notice for violation of Section 118 (10) read with Secretarial Standard-1 of the Companies Act 2013 vide letter no. ROC-G/Insp./206(5)/PISPL/2019/2146-2150 dated 17.02.2020 to the Company and its officers in default. The Company and its directors had submitted reply dated 27.02.2020 which is received on 02.03.2020. However, the reply of the company is not satisfactory.
4. Thereafter, “Notices for Inquiry” vide No. RoC-Gwalior/Adj. Penalties/118(11) /NOI/2021/1667-1671 dated 21.01.2021 were issued to the Company and its officers in default as per [Rule 3(3), Companies(Adjudication of Penalties) Rules 2014] and the date of hearing was fixed on 04.02.2021 at 02:30 PM in the Office of Registrar of Companies, Madhya Pradesh, Sanjay Complex, A block-III floor, Jayendraganj, Gwalior.
5. CS Ravi Kushwah as representative of the Company and its Directors/ officers in default has appeared on the date so fixed. CS Ravi Kushwah has also submitted the company reply dated 01.02.2021. Company has passed a Board Resolution dated 30.01.2021 and authorised him to appear and attend the adjudication proceedings on behalf of the company.
Order
6. Having Considered the facts and circumstances of the case and after taking into account the factors above, as it was observed by the JO from Attendance sheet of Board Meeting for the financial year 2015-16, 2016-17 and 2017-18 that it was not serially numbered and also entries in the attendance register not authenticated by Chairman or Company Secretary as required under Secretarial Standard-1 read with Section 118(10) of the Companies Act, 2013. Therefore, the provisions of the Section 118(10) of the Act, have been contravened and every officer of the company who is in default as the case may be, have rendered themselves liable for penal provisions u/s 118(11) of the Act in company namely M/s PEOPLES INTERNATIONAL & SERVICES PRIVATE LIMITED.
7. Accordingly, I am inclined to impose a penalty as prescribed under Sub-section (11) of Section 118 of the Companies Act, 2013. The details of the penalty imposed on the company and officers in default are shown in the table below:
| Nature of Default | Relevant section under the Companies Act, 2013. | Name of persons on whom penalty is imposed | Penalty for default mentioned in section 118(11) Of the Act. | Final Penalty imposed |
| Secretarial Standard-1 read with Section 118(10) of the Companies Act 2013. | S.1 1 8(10) | On Company | Rs. 25,000/- | Rs. 25,000/- |
| Shri Suresh Narayan Vijay, (Director) | Rs. 5,000/- | Rs. 5,000/- | ||
| Mrs Urmila Devi Vijay (Director) | Rs. 5,000/- | Rs. 5,000/- | ||
| Shri Ishtiaq Hussain Siddiqui, (Director) |
Rs. 5,000/- | Rs. 5,000/- | ||
| Ms Ruchita Prabhulal Jais (Ex- Company Secretary) | Rs. 5,000/- | Rs. 5,000/- |
I am of this opinion that penalty is commensurate with the aforesaid failure committed by the Noticee and penalty so imposed upon the Officers-in-default shall be paid from their personal sources/ income. It is further directed that penalty imposed shall be paid through the Ministry of Corporate Affairs portal only as mentioned under Rule 3(14) of Company (Adjudication of Penalties) (Amendment) Rules, 2019 under intimation to this office.
8. Appeal against this order may be filed in writing with the Hon’ble Regional Director (NWR), Ministry of Corporate Affairs, Ahmedabad 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).
9. Your attention is also invited to Section 454(8)(i) and 454(8)(ii) of the Companies Act, 2013, which state that in case of non-payment of penalty amount ,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 and officer in default 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 both.
10. In terms of the provisions of sub-rule (9) of Rule 3 of the Companies (Adjudication of Penalties) Amendment Rules, 2019, copy of the order is being sent to M/S PEOPLES INTERNATIONAL & SERVICES PRIVATE LIMITED, Project Office, People’s Campus, Karond-Bhanpur, Bye-pass, Village Raslakhedi, Tahsil, Huzur, Bhopal, 462010, Madhya Pradesh, India., Shri Suresh Narayan Vijay, (Director), Mrs. Urmila Devi Vijay (Director) (From 06.08.2015 to 31.12.2018), Shri Ishtiaq Hussain Siddiqui, (Director)(From 06.08.2015), Ms Ruchita Prabhulal Jais (Ex- Company Secretary)(From 15.03.2016 to 15.11.2018)488 and Regional Director (NWR), Naranapura, Ahmedabad and will also be uploaded on MCA Website.
The adjudication notice stands disposed off with this order.
(Rajpal Singh)
Registrar of Companies & Adjudicating officer,
Madhya Pradesh, Gwalior.
Signed on this 04th day of February, 2021.
Place: Gwalior, Madhya Pradesh.
