ORAGEM EXIM PRIVATE LIMITED recently faced penalties imposed by the MCA for its failure to maintain a register of contracts or arrangements in which its directors were interested, as mandated by Section 189 of the Companies Act, 2013. This article provides an in-depth analysis of the violation, the adjudication process, and the penalties imposed by the Registrar of Companies, Rajasthan, Jaipur.
Detailed Analysis:
The case centers around the discovery made by the office of the Registrar of Companies, Rajasthan, during a visit to the company’s registered office. It was observed that the books of accounts or statutory registers were not maintained or kept at the recorded registered office address of the company. Additionally, it was found that ORAGEM EXIM PRIVATE LIMITED had not maintained a register containing particulars of all contracts or arrangements to which Section 184(2) or Section 188 of the Companies Act, 2013 applied. This non-compliance was a clear violation of the provisions of Section 189 of the Companies Act, 2013.
Section 189 of the Companies Act, 2013 stipulates that every company shall maintain one or more registers providing details of all contracts or arrangements to which Section 184(2) or Section 188 of the Act applies. These registers should be maintained in the prescribed manner and should include the required particulars. After entering the necessary details, these registers must be presented before the next meeting of the Board and signed by all the directors present at that meeting.
In response to this violation, an adjudication notice dated August 26, 2022, was issued to the company and its officers in default. This notice offered them an opportunity to present their case and be heard on September 13, 2022, at 11 A.M. at the office of the Registrar of Companies in Jaipur.
However, on the scheduled hearing date, no representative from the company or its directors appeared, and the default was not rectified. Consequently, it was determined that every director of the company was in default. After a careful examination of the facts, the Registrar of Companies concluded that ORAGEM EXIM PRIVATE LIMITED and its directors had indeed failed to comply with the provisions of Section 189 of the Companies Act, 2013.
In light of the above, the Registrar of Companies issued an adjudication order imposing penalties as follows:
- ORAGEM EXIM PRIVATE LIMITED: Rs. 25,000/-
- Each director in default (3 directors): Rs. 12,500/- per director
The total penalty amounted to Rs. 37,500/-. It was specified that the company should pay Rs. 25,000/-, and each of the three directors in default should pay Rs. 12,500/-. These penalties were imposed for the violation of Section 189 of the Companies Act, 2013.
The matter was subsequently disposed of with this order, signed on September 22, 2022.
Conclusion:
The case of ORAGEM EXIM PRIVATE LIMITED serves as a stark reminder of the importance of adhering to statutory requirements, such as maintaining a register of contracts or arrangements involving directors, as mandated by the Companies Act, 2013. Failure to comply with such requirements can result in financial penalties, as demonstrated by the penalties imposed in this case. It emphasizes the necessity for companies to ensure strict compliance with all regulatory obligations to avoid legal consequences.
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Registrar of Companies, Rajasthan, Jaipur
In the matter of Companies Act 2013
And
In the matter of adjudication proceeding under section 454 (3) of Companies Act, 2013
And
In the matter of adjudication proceeding for the violation of section 189 of the Companies Act, 2013.
And
In the matter of
1. ORAGEM EXIM PRIVATE LIMITED
2. Abhishek Kumawat, Director
3. RAJIVKUMAR JAISWAR
4. Pavan Varma
………. Respondents
Date of hearing- 13/09/2022
Order No. 2543 to 2548 Date-: 28.09.2022
Present
1. Shri C. M. Karl Marx, Registrar of Companies, Rajasthan, Jaipur, Adjudicating Officer
Adjudication Order
Fact of the Case
1. It is noticed that the books of accounts or statutory registered are not at all maintained or kept at the said recorded Registered Office address by the company, neither the company has maintained a register which contain such particulars of all contracts or arrangements to which subsection (2) of Section 184 or section 188 applies, since the registered office of the company doesn’t exists at the registered address as per visit report prepared by the office of Registrar Of Companies, Jaipur, Rajasthan, thus it is implied that company has also not complied with the provisions of Section 189 of the Companies Act, 2013 in this regard.
2. As per provision of section 189 of the Companies Act 2013, every company shall keep one or more registers giving separately the particulars of all contracts or arrangements to which sub-section (2) of Section 184 or section 188 applies, in such manner and containing such particulars as may be prescribed and after entering the particulars, such register or registers shall be placed before the next meeting of the Board and signed by all the directors present at the meeting.
3. The aforesaid violation was taken up with the company and its officers in default vide adjudication Notice dated 26.08.2022 for violation of section 189 of the companies Act, 2013 giving an opportunity of being heard on 13t11 September 2022 at 1:1. A.M. in the committee room of the 0/0 Register of the Companies Corporate Bhawan, G – 6 867, Residency Area, Civil Lines, Jaipur-302001.
4. No one has appeared today on behalf of Company and other directors. Further, the default is not rectified as on date. Hence, it is concluded that every director of the Company is defaulted. On carefully examination and considering the fact of the case, I am on conclusion that the provision of section 189 of the Companies Act, 2013 have not been complied with by the Company and its directors.
ORDER
“That keeping in mind all the relevant facts, penalty of Rs. 25,000/- (Rs. Twenty-five thousand only) is provides in the penal provision of section 189 of the Companies Act, 2013. Keeping in view of section 446B of the Act penalty is hereby imposed Rs. 12,500/- (Rs. Twelve thousand five hundred only) on each for 3 directors in default for violation of section 189 of the Companies Act, 2013. Total penalty is hereby imposed Rs. 37,500/-(Rs. Thirty-seven thousand five hundred only)”
The matter has been stands disposed of with this order. Signed this on 22nd day of September 2022.
C. M. Karl Marx
Registrar of companies, Rajasthan
Jaipur (Rajasthan)
