The Registrar of Companies, Chennai passed an adjudication order under Section 454 of the Companies Act, 2013, holding a public company and its officers liable for violation of Section 149(1) read with Rule 3 of the Companies (Appointment and Qualification of Directors) Rules, 2014, for failure to appoint a woman director within the prescribed timeline. Based on financial statements for FY 2019–20 and 2020–21, the company’s turnover exceeded ₹300 crore, mandating the appointment of at least one woman director by 30 June 2020. The appointment was made only on 8 November 2021, resulting in a delay of over one year. The explanation citing COVID-19 disruptions was noted but did not negate statutory non-compliance. Accordingly, penalties were imposed under Section 172—₹2.98 lakh on the company and ₹1 lakh each on two officers in default. The order directs rectification and payment within 90 days, allows appeal before the Regional Director, and clarifies that officers must pay penalties from personal sources.
GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
ROC Chennai
Registrar Of Companies, Block No.6,B Wing 2nd Floor, Shastri Bhawan 26, Haddows Road, Chennai, Tamil Nadu, India, 600034
Phone: 044-28276652/28276654
E-mail: roc.chennai@mca.gov.in
Order ID: PO/ADJ/12-2025/CN/01068 | Dated: 31/12/2025
ORDER FOR ADJUDICATION OF PENALTY UNDER SECTION 454 OF THE COMPANIES ACT, 2013 (‘THE ACT’) FOR VIOLATION OF SECTION 172 OF THE COMPANIES ACT, 2013.
A. Appointment of Adjudicating Officer:
Ministry of Corporate Affairs vide its Gazette notification number S.O. 831(E) dated 24/03/2015 appointed undersigned as Adjudicating Officer in exercise of the powers conferred by section 454 of the Companies Act, 2013 [herein after known as Act] read with Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.
B. Company details:
In the matter relating to KUMBAKONAM MUTUAL BENEFIT FUND NIDHI LIMITED [herein after known as Company] bearing CIN U65991TN1903PLN001246, is a company registered with this office under the Provisions of the Companies Act, 2013/1956 having its registered office situated at NO. 23 & 24, NO. 23 & 24, KUMBAKONAM KUMBAKONAM THANJAVUR TAMIL NADU INDIA 612001
Individual details:
In the matter relating to VISVALINGAM KANAKARAJ —————
In the matter relating to RENGABHASHYAM PADMANABHAN RENGABHASHYAM ——————
C. Provisions 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.
D. Facts about the case:
1. Default committed by the officers in default/noticee – The company Kumbakonam Mutual Benefit Fund Nidhi Limited (CIN: U65991TN1903PLN001246) represented by Mr. Velappan Ponnusamy, Managing Director has filed Adjudication application in GNL-1 vide SRN: N28140887 dt 04.02.2025 for violation of Section 149(1) of the Companies Act, 2013 read with 3(ii) (b) of the Companies (Appointment and Qualification of Directors), Rules, 2014 and also submitted physical application of 11.02.2025.
The Ministry vide letter dated 07.07.2022 stated that ” it has been noticed from the financial statements filed in form AOC-4 for the period 31.03.2020 & 31.03.2021 that the company has a turnover of Rs.31,69,485,000/- & Rs.35,35,652,000/- during the financial years 2019-20 & 2020-21 which is more than Rs.300 Cr. So, as per provision of Companies Act, 2013 a company is required to appoint at least one woman director on its board, which the company has failed to appoint the same. Therefore, the company has violated the Rule 3 of Companies (Appointment and Qualification of Directors) Rules, 2014. However, the company has appointed Smt. Elangovan Amika on 08.11.2021 as director of the company”.
The applicants submitted that the company has appointed Smt. Elangovan Ambika on 08.11.2021 as Woman director of the company b filing DIR-12 vide SRN: T57865354 dt 08.11.2021. Further, due date of appointment was on 30.06.2020 and therefore, there is delay of 1 year, 4 months and 7 days.
Further, submitted that due to the circumstances prevalent during the COVID-19 pandemic and complete lock down implemented by the Government, the company was unable to identify and appoint suitable candidate as Woman director within the stipulated timeframe.
There is a delay in appointing Woman director in the company, hence the company and its officers in default are a liable as per the provisions of Section 172 of the Companies Act, 2013.
Rule of 3 of the Companies (Appointment and Qualifications of Directors) Rules, 2014: Woman Director on the Board.
The following class of companies shall appoint at least one woman director-
i. every listed company;
ii. every other public company having –
iii. paid? up share capital of one hundred crore rupees or more; or
iv. turnover of three hundred crore rupees or more:
Provided that a company, which has been incorporated under the Act and is covered under provisions of second proviso to sub-section (1) of section 149 shall comply with such provisions within a period of six months from the date of its incorporation:
Provided further that any intermittent vacancy of a woman director shall be filled-up by the Board at the earliest but not later than immediate next Board meeting or three months from the date of such vacancy whichever is later.
2. The adjudicating authority has issued notice for E- Adjudication on 19/03/2025. The managing director vide letter dated 01.04.2025 has replied to the show cause notice stating that the company acknowledges the requirement under Section 149(1) of the Companies Act,2013, and the corresponding rules for the appointment of a Woman Director. It was further stated that, due to unforeseen circumstances, including the challenges posed by the CoVID-19 pandemic, the company faced unavoidable delays in compliance with this requirement. However, the management appointed a women director Smt. Elangovan Ambika on 08.11.2021 by filing DIR-12 vide SRN: T57865354 dated 08/11/2021.
Further, suo moto application was made to make good of the delay, considering which leniency shall be granted in the penalty amount.
Further the adjudicating authority has issued notice on 11.04.2025 for e-hearing on 15/04/2025. Mrs. Vidhya Sivakumar (M. No. 17092; CP No. 7282) designated Company secretary in practice has attended the e-hearing fixed on 15.04.2025 on behalf of the company and made submissions that the violation maybe adjudicated. None appeared for the e-hearing on behalf of the officers in default.
E. Order:
1. It is noticed that pursuant to the provisions of Section 149(1) of the Companies Act, 2013, read with Rule 3 of the Companies (Appointment and Qualification of Directors) Rules, 2014, it is mandatory for a company to appoint at least one-Woman Director on its Board if the company meets certain thresholds, including a turnover of three hundred crore rupees or more. The company, having a turnover exceeding the prescribed threshold during the year 31″ March 2020 and 31 March 2021, failed to comply with this statutory requirement, resulting in a default under the applicable provisions. Consequently, the Company has violated Rule 3 of the Companies (Appointment and Qualification of Directors) Rules, 2014 during the period, and is therefore liable under section 172 of Companies Act, 2013.
2. The details of penalty imposed on the company, officers in default and others are shown in the table below:
| (A) | Name of person on whom penalty imposed (B) | Rectification of Default required (C) | Penalty Amount (D) | Additional Penalty (E) (*Per day of continuing default i.e. date of rectification of default less order issue date) | Maximum limit for Penalty (F) |
| 1 | KUMBAKONAM MUTUAL BENEFIT FUND NIDHI LIMITED having CIN as U65991TN1903P LN001246 | 298000 | 0 | 300000 | |
| 2 | VISVALINGAM KANAKARAJ having DIN as 08205976 | 100000 | 0 | 100000 | |
| 3 | RENGABHASHY AM PADMANABHAN RENGABHASHY AM having PAN as AAHPP8612J | 100000 | 0 | 100000 |
3. The notified officers in default/noticee shall rectify the default mentioned above and pay the penalty, so applicable within 90 days of receipt of the order.
4. The notified officers in default/noticee shall pay the penalty amount via ‘e-Adjudication’ facility which can be accessed through the respective login IDs on the website of Ministry of Corporate Affairs and upload the copy of paid challan / SRN of e-filing (if applicable) on the ‘e-Adjudication’ portal itself. It is also directed that the penalty so imposed upon the officers in default shall be paid from their personal sources/income.
5. Appeal against this order may be filed in writing with the Regional Director, RD Chennai within a period of sixty days from the date of receipt of this order, in Form ADJ setting for 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 (Adjudication of Penalties) Rules, 2014].
6. For penal consequences of non-payment of penalty within the prescribed time limit, please refer Section 454(8) of the Companies Act, 2013.
B SRIKUMAR,
Registrar of Companies
ROC Chennai
