The Ministry of Corporate Affairs, Registrar of Companies, Karnataka, issued an adjudication order imposing penalties on Trualt Bioenergy Limited for violating Section 203 of the Companies Act, 2013. The violation pertained to the delayed appointment of key managerial personnel (KMP) following an increase in the company’s paid-up share capital. Trualt Bioenergy Limited, previously Trualt Energy Limited, filed a suo-motu adjudication application acknowledging the breach. Despite efforts, the company failed to appoint a Chief Financial Officer (CFO) and a Company Secretary (CS) within the required timeframe. Consequently, Dr. Debnath Mukhopadhyay was appointed as CFO on 08.05.2023, and Ms. Manali Velangi as CS on 01.04.2023, while Mr. Vijaykumar Murugesh Nirani was appointed as Managing Director on 28.11.2022. The default period spanned from 30.06.2022 to 07.05.2023. The adjudication officer imposed penalties on the company and its directors, amounting to Rs. 5,00,000 for the company, Rs. 3,61,000 for Mr. Vijaykumar Murugesh Nirani, and Rs. 2,00,000 each for directors Sangamesh Nirani and Vishal Nirani. The company and its officers must pay these penalties within 90 days and file Form INC-28 with payment proof. Appeals against the order can be filed within 60 days with the Regional Director (South East Region), Hyderabad. Non-compliance will result in further penal action under Section 454(8) of the Companies Act, 2013.
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Government of India
Ministry of Corporate Affairs
Registrar of Companies, Karnataka
Kendriya Sedan,2nd ”Floor, ‘E’ Wing,
Koramangala, Bengaluru 560 034
W1N: 080.25537449/25633105
E-mail ID: ros.bangalore6Pmca.Soltin
File No. ROC(B)/Adj.Ord.454-203/Trualt Bioenergy/Co.No.1459713/2024 Date: 24.06. 2024
ORDER OF ADJUDICATION OF PENALTY UNDER SECTION 454 OF COMPANIES ACT 7013 READ WITH RULE 3 OF THE COMPANIES (ADJUDICATION OF PENALITE) RULES. 2014 FOR VIOLATION OF PROVISIONS OF SECTION 203 OF THE COMPANIES ACT. 2013 READ WITH RULES (AS AMENDED FROM TIME TO TIME) FRAMED THEREIN BY TRUALT BIOENERGY 1 IMITED (FORMER! Y KNOWN AS TRUALT ENERGY 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, Trualt Bioenergy Limited (hereinafter referred to as Company) having CIN: U15400KA2021PLC145978 was incorporated on 31.03.2021 and is presently registered under the jurisdiction of Registrar of Companies, Kamataka and the registered office situated at Survey No. 166, Kulali Cross, Jamkhandi Mudhol Road. Bagalkot Kamataka-587313.
3. The company has filed a suo-motu adjudication application on 15.04.2024 for violation of section 203 of the Act. It has been submitted in the application that the paid-up share capital of the company was Increased from Rs. 6,10.000 to Rs. 60.06,10,000. Hence the company was required to appoint key managerial personnel as whole time managerial personnel as per the provisions of section 203 of the Companies Act. 2013 read with Rule 8 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 with effect from 30.06.2022.
4. However, Dr. Debnath Mukhopadhyay was appointed as Chief Financial Officer of the company with effect from 08.05.2023, Ms. Manali Velangi was appointed as Company Secretary of the company with effect from 0144.2023 and Mr. Vijaykumar Murugesh Nirani was appointed Managing Director of the company with effect from 28.112022. Hence the company has violated the provisions of section 203(1) of the Companies Act, 2013.
5. As per section 203(1) of the Act, every company belonging to such class or classes of companies as may be prescribed shall have whole-time key managerial personnel including company secretary and as per Rule 8 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, every listed company and every other public company having a paid-up share capital of Rs. 10 crore or more shall have whole-time key managerial personnel.
6. As per section 203(5) of the Act, if any company makes any default in complying with the provisions of this section, such company shall be liable to a penalty of five lakh rupees and every director and key managerial personnel of the company who is in default shall be liable to a penalty of fifty thousand rupees and where the default is a continuing one, with a further penalty of one thousand rupees for each day after the first during which such default continues but not exceeding five lath rupees.
7. Pursuant to the adjudication application filed by the company, Notice of hearing was sent on 03.05.2024 and physical hearing was held on 22.05.2024. It was attended by Mr. K. Dushyantha Kumar, practising company secretary and authorised representative appeared on behalf of the company and all directors and made his submissions before the Adjudicating Officer. Further, he stated that the company had tried all its means to appoint a Chief Financial Officer and a whole-time company secretary but could not find an appropriate candidate having relevant experience in the company’s line of business. However, with due efforts the company could recruit suitable candidates wherein Dr. Debnath Mukhopadhyay, was appoint as Chief Financial Officer of the company w.e.f. 08.05.2023 and CS Manali Velangi was appointed as the Company Secretary of the Company w.e.t 01.04.2023 in compliances with the provisions of section 203 of the Companies Act, 2013. CS Manali Velangi is newly Joined and not involved in decision making about the company, hence requested to not consider as part of default period.
8. In view of the provisions detailed above and the records, the company and the respective officers in default have defaulted the provisions of section 203(1) of the Companies Act, 2013 dealing with appointment of key managerial personnel for a duration of 312 days i.e. from 30.062022 to 07.05.2023 for which they are liable to penalty. It is seen from the records that the company had a managing director from 2t11.2022 to 07.05.2023. For the duration of default where the company had managing director, the managing director is being held liable as the officer who was in default and for the remaining duration of default all the directors of the company are being held liable.
9. It is seen that the company is a holding company and does not fall under the definition of a small company as per the provisions of section 2(85) of the Companies Act, 2013. Therefore, the provisions of imposing lesser penalty as per the section 4466 of the Act shall not be applicable in this case.
10. Therefore, having considered the facts and circumstances of the case and the submissions made by the company and present / past directors through their authorised representatives, in view of the above said violations under the provisions of section 203(l) of the Companies Act. 2013, read with Rule 8 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in exercise of the powers vested under section 454(3)(a) of the Companies Act 2013,1 do hereby impose penalty in the following manner on the company and the directors / officers who were in default of the offence committed:
| S. No | Particulars of notice | Duration of default |
Calculation of penalty (In Rs.) |
Maximum penalty (In Rs.) |
Penalty imposed On Rs.) |
| 1 | Company | 312 days (30.06.2022 to 07.05.2023) | 5,00003 | 5,00,000 | 5,00,000 |
| 2 | Vijaykumar Murugesh Nirani. Director and Managing Director | 312 days (30.062022 to 27.112022 and 28.11.2022 to 07.05.2023) | 3,61,003 (50.000+ 1,000 X 311) | 5,00,000 | 3,61,000 |
| 3 | Sangamesh Nirani, Director | 151 days (30.06.2022 to 27.11.2022) | 2,00,000 (50,000+ 1,000 X 150) | 5,00,000 | 2,00,000 |
| 4 | Vishal Nirani, Director |
151 days (30.06.2022 to 2711.2022) | 2,00,000 (50,000 +1,000 X 150) | 5.00,000 | 2.00.000 |
11. 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 notice 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.
12. 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 AD) setting forth the grounds of appeal and shall be accompanies by a certified copy of this Order
13. 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 maner.
14. 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 Act 2013.
