In a recent order, the Ministry of Corporate Affairs (MCA) has imposed a penalty on BASIS VECTORS INDIA PRIVATE LIMITED for a delay of 414 days in filing e-form MGT-6, as required under Section 89(6) of the Companies Act, 2013. The penalty is also extended to the company’s directors, Ambarish Narayan Gupta and Deepak, for their roles in the violation.

Background: BASIS VECTORS INDIA PRIVATE LIMITED, incorporated on June 29, 2022, and operating from Gurgaon, Haryana, was found to have failed to comply with the provisions of Section 89 of the Companies Act, 2013. The company, engaged in charitable activities, received notices for non-compliance, leading to an inquiry by the Ministry of Corporate Affairs.

Violation and Penalty Calculation

  • Delay in Filing MGT-6: The company, according to the order, delayed the filing of e-form MGT-6 by 414 days. The violation was noted in the context of Sections 89(6) and 89(7) of the Companies Act, 2013.
  • Penalty Imposition: The Adjudicating Officer, Pranay Chaturvedi, imposed a penalty of Rs. 4,14,000 on BASIS VECTORS INDIA PRIVATE LIMITED for the delay in filing MGT-6. The penalty for directors Ambarish Narayan Gupta and Deepak was set at Rs. 4,14,000 each. However, the penalty amount for each director was capped at Rs. 2,00,000, as per the maximum limit defined by Section 89(7) of the Act.

Order and Compliance: The order instructs the concerned parties to pay the imposed penalties within 90 days of the order’s receipt. Payment is to be made through the MCA website, and proof of payment is required to be submitted to the office.

Additionally, parties aggrieved by the order have the option to file an appeal with the Regional Director (NR), Ministry of Corporate Affairs, within sixty days from the date of receiving the order. The appeal should be submitted using the prescribed form available on the Ministry’s website and must include a certified copy of the order.

Conclusion: The penalty order against BASIS VECTORS INDIA PRIVATE LIMITED underscores the significance of timely compliance with statutory requirements under the Companies Act, 2013. The MCA’s strict enforcement of penalties serves as a reminder to companies and directors to adhere to the prescribed timelines for filing relevant forms and declarations, promoting transparency and accountability in corporate governance.

****

GOVERNMENT OF INDIA
MIMSTRY OF CORPORATE AFFAIRS,
OFFICE OF REGISTRAR OF COMPANIES,
NCT OF DELHI & HARYANA
4TH FLOOR, IFCI TOWER, 61, NEIIRU PLACE,
NEW DELHI -110019

ORDER OF PENALTY PURSUANT TO SECTION 89 OF THE COMPANIES ACT, 2013 IN THE MATTER OF BASIS VECTORS INDIA PRIVATE LIMITED (U74999H R2022FTC104800)

1. Appointment of Adjudicating Officer:

Ministry of Corporate Affairs vide its Gazette Notification No. A-42011/112/2014-Ad.II, dated 24.03.2015 appointed Registrar of Companies, NCT of Delhi & Haryana as Adjudicating Officer in exercise of the powers conferred by section 454(1) of the Companies Act, 2013 (hereinafter known as Act) r/w Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.

2. Company:

Whereas the company viz. BASIS VECTORS INDIA PRIVATE LIMITED (herein after known as ‘company’) has been incorporated on 29.06.2022 and having its registered office as per MCA21 Register address at HD-084, WEWORK DLF FORUM BUILDING, CYBER CITY, PHASE III, GURUGRAM, Gurgaon, Haryana,122002,India. The financial & other details of the subject company for the year ended 31st March, 2023 as available on MCA-21 portal is stated as under:

S. No.

Particulars Details
1. Paid up capital (in INR and in thousands) 100
2. a. Revenue from operation (in INR and in thousands) 76810.71
b. Other Income (in INR and in thousands) 0
c. Profit for the Period (in INR and in thousands) 8237.66
3. Holding Company YES
4. Subsidiary Company NO
5. Whether company registered under Section 8 of the Act? NO
6. Whether company registered under any other special Act? NO

3. Facts about the Case:

(i) It is observed from the record that company has filed its Annual Return for F.Y. 2022-23 vide eform MGT-7 (SRN F63882963) wherein it is mentioned that BASIS VECTORS, INC. is holding 100% shares in the subject company. However, it is seen that company has in total 2 (two) shareholders. Therefore, the beneficial holder and the registered holder ought to have declared the status of their interest in the shares in terms of Section 89(1) and Section 89(2) of the Act. Further, it was also seen that the company has not filed MGT-6 in term of Rule 9 (3) of Companies (Management and Administration) Rule, 2014 with this office.

(ii) In view of above facts, a show cause notice u/s 89 of the Act was issued to the company vide dated 29.09.2023

(iii) In response to the said SCN, a reply has been received from the company on 12.10.2023 wherein company stated that the e-form MGT-6 has been filed vide SRN F66840828 on 10.10.2023.

(iv) Further, in view of submissions made in reply, a hearing in the matter was scheduled for oral submissions on 01.11.2023 wherein Ms. Preeti Bansal, Practising Company Secretary and Authorised representative (AR) of the Company appeared for hearing and submitted as under:

  • That the company had given disclosure about the nominee shareholder in the MOA of the company.
  • The company has already filed form MGT-6 in response to the notice issued by this office and therefore the Authorised representative has submitted that no penal action may be taken against them in this matter.

(v) Thereafter, based on the submissions during hearing, company was asked to submit additional documents like authorization letter concerning MGT-5, proof of receipt of declaration pursuant to section 89(1) and 89(2) and other documents.

(vi) Thereafter, company vide its letter dated 03.11.2023 letter dated 21.11.2023 received on 01.12.2023 submitted desired information.

(vii) Thus, it is evident from the filings of e form MGT-6 that company had received forms MGT-4 and MGT-5 on 23.07.2022 but form MGT-6 has been filed vide SRN F66840828 on 10.10.2023.

4. The relevant provision of the Act and Rules therewith:

Section 89. Declaration in respect of beneficial interest in any share:

(1) Where the name of a person is entered in the register of members of a company as the holder of shares in that company but who does not hold the beneficial interest in such shares, such person shall make a declaration within such time and in such form as may be prescribed to the company specifying the name and other particulars of the person who holds the beneficial interest in such shares.

(2) Every person who holds or acquires a beneficial interest in share of a company shall make a declaration to the company specifying the nature of his interest, particulars of the person in whose name the shares stand registered in the books of the company and such other particulars as may be prescribed.

(5) If any person fails to make a declaration as required under sub-section (1) or sub-section (2) or sub-section (3), he shall be liable to a penalty of fifty thousand rupees and in case of continuing failure, with a further penalty of two hundred rupees for each day after the first during which such failure continues, subject to a maximum of five lakh rupees.

(6) Where any declaration under this section is made to a company, the company shall make a note of such declaration in the register concerned and shall file, within thirty days from the date of receipt of declaration by it, a return in the prescribed form with the Registrar in respect of such declaration with such fees or additional fees as may be prescribed.

(7) If a company, required to file a return under sub-section (6), fails to do so before the expiry of the time specified therein, the company and every officer of the company who is in default shall be liable to a penalty of one thousand rupees for each day during which such failure continues, subject to a maximum of five lakh rupees in the case of a company and two lakh rupees in case of an officer who is in default.

Rule 9 of Companies (Management and Administration) Rule, 2014

(1) A person whose name is entered in the register of members of a company as the holder of shares in that company but who does not hold the beneficial interest in such shares (hereinafter referred to as 9 “the registered owner”), shall file with the company, a declaration to that effect in Form No.MGT.4 in duplicate, within a period of thirty days from the date on which his name is entered in the register of members of such company:

(2) Every person holding and exempted from furnishing declaration or acquiring a beneficial interest in shares of a company not registered in his name (hereinafter referred to as “the beneficial owner”) shall file with the company, a declaration disclosing such interest in Form No. MGT.5 in duplicate, within thirty days after acquiring such beneficial interest in the shares of the company.

(3) Where any declaration under section 89 is received by the company, the company shall make a note of such declaration in the register of members and shall file, within a period of thirty days from the date of receipt of declaration by it, a return in Form No.MGT.6 with the Registrar in respect of such declaration with fee.

5. Adjudication of penalty:

i. The company has stated that it has filed MGT-6 on 10.10.2023. But it is clear that such form was filed only after receipt of a SCN from this office. It is also seen that the company had already received the copies of MGT-4 and MGT-5 on 23.07.2022. In such case, it has no discretion to withhold the filing of form MGT-6. Thus, the company was required to file form MGT-6 on or before 22.08.2022. Accordingly, there is a delay of 414 days in filing e-form MGT-6. Hence, there is a violation of Section 89(6) of the Act and accordingly the company and its every officer in default are liable for penalty u/s 89(7) of the Act.

ii. The subject company does not get covered under the purview of small company as defined u/s 2(85) of the Act. Hence, the benefit of section 446B would not be applicable on the company.

iii. Now in exercise of the powers conferred vide Notification dated 24th March, 2015 and having considered the reply submitted by the noticee (s) in response to the notice issued on 29.09.2023 and reply dated 03.11.2023 & 21.11.2023, I do hereby impose the penalty on the company and its officers in default for violation of Section 89(6) of the Act:

Table-I

Violation section & period

Penalty imposed on company/ director(s) Calculation of penalty amount
(in Rs.)
Penalty imposed as per Section
89(7) (in Rs.)
A B C D
Section 89(6) for delay of 414 days in filing of from MGT-6 BASIS VECTORS INDIA PRIVATE LIMITED 414×1000=4,14,000 Subject to maximum 5,00,000 4,14,000
AMBARISH NARAYAN GUPTA (director) 414×1000=4,14,000 Subject to maximum 2,00,000 2,00,000
DEEPAK (director) 414×1000=4,14,000 Subject to maximum 2,00,000 2,00,000

6. Order:

a. Names of parties as mentioned in the table I above are hereby directed to pay the penalty amount as per column no. ‘D’ therein. In case of parties other than company, such amount is required to be paid out of their own funds.

b. The said amount of penalty shall be paid through online by using the website mca.gov.in (Misc. head) in favor of “Pay & Accounts Officer, Ministry of Corporate Affairs, New Delhi, within 90 days of receipt of this order, and intimate this office with proof of penalty paid.

c. Appeal against this order may be filed with the Regional Director (NR), Ministry of Corporate Affairs, B-2 Wing, 2nd Floor, Paryavaran Bhawan, CGO Complex, Lodhi Road, New Delhi-110003 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 the order. [Section 454(5) & 454(6) of the Act read with Companies (Adjudicating of Penalties) Rules, 2014].

d. Your attention is also invited to section 454(8) of the Act in the event of non-compliance of this order.

(Pranay Chaturvedi, las)
(Adjudicating Officer)
Registrar of Companies
NCT of Delhi & Haryana

No. ROC/D/Adj/Order/89/Basis Vector/ 317-320

Date: 25/01/2024

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