Delay in INC-20A form Filing: MCA imposes penalty

Introduction: In a recent adjudication proceeding under Section 454 and Sub-section (1)(a) of Section 10A of the Companies Act, 2013, Sambhava Agro Producer Company Limited faces penalties for delaying the filing of the INC-20A form. The adjudicating officer, Sitaram Sharan Gupta, appointed by the Ministry of Corporate Affairs, has issued a detailed order.

Detailed Analysis:

1. Background of the Company: Sambhava Agro Producer Company Limited, incorporated on 06/01/2020, failed to file the INC-20A form within the prescribed time frame.The company, categorized as a producer company, didn’t comply with the provisions of Section 10A(1)(a) of the Companies Act, 2013.

2. Facts about the Case: The company was mandated to file the INC-20A form by the due date of 05/07/2020, within 180 days of incorporation, but failed to do so. A show cause notice was issued by the adjudicating officer on 08.08.2023, providing an opportunity for the company and its officers to respond.

3. Show Cause Notice, Reply, and Hearing: Despite receiving no reply to the show cause notice, a notice of inquiry was issued, and a hearing was scheduled on 11/10/2023. No representatives from the company attended the hearing, leading to the adjudication in their absence.

4. Imposition of Penalty: The adjudicating officer, invoking Section 454(3) of the Companies Act 2013, imposed penalties for the period from 06/07/2020 to 11/10/2023. Detailed penalties for the company and each officer in default, including Ram Pal Patel, Santoshi Bai Sidar, Mina Patel, Sitaram Patel, and Ramkanhai Soni, were specified.

5. Appeal and Consequences: The company and its directors have 60 days to file an appeal with the Regional Director (NWR), Ministry of Corporate Affairs. Non-payment of penalties may result in fines and imprisonment, as per Section 454(8)(i) and 454(8)(ii) of the Companies Act, 2013.

6. Rectification and Compliance: The company and its directors are directed to rectify the default immediately and file form INC-20A in compliance with Section 454(3)(b) of the Companies Act 2013.

Conclusion: The penalty imposition on Sambhava Agro Producer Company Limited serves as a stark reminder of the importance of timely compliance with statutory filing requirements. This case emphasizes the consequences of neglecting obligations under the Companies Act, 2013, and highlights the legal actions and financial implications faced by companies and their officers in default for non-compliance. Companies are urged to prioritize adherence to regulatory timelines to avoid penalties and potential legal repercussions.

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BEFORE THE ADJUDICATING OFFICER

REGISTRAR OF COMPANIES CUM OFFICIAL LIQUIDATOR, CHHATTISGARH

In the matter of Companies Act, 2013
And
In the matter of adjudication proceeding under Section 454
And
Sub-section (1)(a) of Section 10A of the Companies Act, 2013.
And

In the matter of SAMBHAVA AGRO PRODUCER COMPANY LIMITED
(CIN: U01100C12020PT0009854)
Date of Hearing: 11/10/2023

1. SAMBHAVA AGRO PRODUCER COMPANY LIMITED

H.18,Te1ipali,Pussore, Post-Loharsingh,
Kondatarai, 496100 RAIGARH-Raigarh, India.

2. RAM PAL PATEL (Director)

3. SANTOSHI BAI SIDAR (Director)

4. MINA PATEL (Director)

5. SITARAM PATEL (Director)

6. RAMKANHAI SONI (Director)

………. Respondents

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 undersigned as Adjudicating Officer in exercise of the powers conferred by section 454 of the Companies Act, 2013 read with Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.

2. Company:–

Whereas Company SAMBHAVA AGRO PRODUCER COMPANY LIMITED (CIN: U01100CT202OPTC009854) [herein after referred as Company] incorporated on 06/01/2020 is a registered company with this office under the provisions of Companies Act, 2013, having its registered address at H.18, Telipali, Pussore, Post-Loharsingh,Kondatarai, RAIGARH-Raigarh CT 496100,India.

Further, financial, and other details of the subject company for immediately preceding financial year as available on MCA-21 Portal is as under:

3. Facts about the case: –

It is observed from the record of the company available on the record room of the e-registry of Ministry of Corporate Affairs, Government of India, on MCA portal that the subject company was incorporated on 06/01/2020 and therefore the mandate contended u/s 10A r/w rule 23A of the Companies (Incorporation) Rules, 2014, the prescribed e-form i.e.,INC-20A was required to be filed by the company latest by 05/07/2020 (herein after referred to be the “due date”) i.e., within a period of 180 days of the date of incorporation.

Whereas it is observed from MCA record that the company has not filed Declaration at the time of commencement of business in form no. INC-20A, as per Rules 23A the Companies (Incorporation) Rules, 2014 till date. Therefore, for such default the company and every officer who is in default are liable for the penalty u/s 10A of the Act.

Show cause notice, reply and personal hearing: –

4. Therefore, for the above-mentioned violation this office has issued Show cause notice to the company and its officers in default vide this office letter No. ROC-cum-OL-C.G./SCN/Sec.10A(1)/009854/2023/817 to 822 dated 08.08.2023 u/s 10A of the Companies Act, 2013.

5. Further no reply to the aforesaid show cause notices were received from the company and its officers in default. Therefore, for providing an opportunity of being heard, a “Notice of Inquiry” vide this office letter No. ROC-cum-OL-CG./SCN/Sec.10A(1)/ 009854/2023/1196 to 1201 dated 22/09/2023 was issued to the Company and its officers in default and the date of hearing was fixed on 11/10/2023, in the 0/o Registrar of the Companies, Chhattisgarh, Ist Floor, Late Shri Ashok Pingley Bhawan of Municipal Corporation Nehru Chowk, Bilaspur, Chhattisgarh-495001.

6. None appeared for the Company and its officers in default on the date so fixed, despite providing them reasonable opportunities of being heard. Hence as per Rule 3(11), Companies (Adjudication of Penalties) Rules 2014, the matter is being proceeded with in the absence of such persons.

7. Therefore, in view of the above said violation of non-filing of declaration under the provisions of section 10A(1)(a) of the Companies Act, 2013 read with section 10(2) of the Act, and in exercise of the powers vested under Section 454(3) of the Companies Act 2013, I do hereby impose penalty in the following manner on the company and all the officers in default during the period of offence committed from 06/07/2020 (181st day from date of incorporation) to 11/10/2023 (Date of hearing before Adjudicating officer).

Order

In view of the above, it is concluded that the Company and its officers in default are liable for penalty as prescribed under Section 10A(2) of the Act for non-compliance of section 10A(1) of the Companies Act 2013, for 1192 i.e., with effect from 06/07/2020 (181st day from date of incorporation) to 11/10/2023 (Date of hearing before Adjudicating officer) in terms of Section 10A(2) of the Companies Act, 2013.

Accordingly, I am inclined to impose penalty as prescribed under Section 10A(2) of the Companies Act, 2013. The details of the penalty imposed on the company and officers in default are shown in the table below:

*As the company is a producer company, therefore, as per Section 446B of the Companies Act, 2013, company and its officers in default or any other person shall be liable to a penalty which shall not be more than one-half of the penalty specified in such provisions.

I. I am of the opinion that penalty is commensurate with the aforesaid failure committed by the Noticees and penalty so imposed upon them shall be paid from their personal sources/ income.

II. The company and officers in default shall pay the said amount of penalty through online mode by using the website mca.gov.in (Misc. head) specifying the details of this order and the name of the noticee who is paying the penalty pursuant to Rule 3(14) of Company (Adjudication of Penalties) (Amendment) Rules, 2019, within 90 days of receipt of this order. Further the company shall file form INC-28 attaching a copy of order and payment challans.

III. 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).

IV. 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.

V. The company and its directors are hereby directed to rectify the default immediately on the date of receipt of copy of this order and file form INC 20A in terms of section 454(3)(b) of the Companies Act 2013.

In terms of the provisions of sub-rule (9) of Rule 3 of the Companies (Adjudication of Penalties) Rules, 2014, copy of the order is being sent to:

1. SAMBHAVA AGRO PRODUCER COMPANY LIMITED

H.18,Telipali,Pussore, Post-Loharsingh,
Kondatarai, 496100 RAIGARH-Raigarh, India.

2. RAM PAL PATEL (Director)

3. SANTOSHI BAI SIDAR (Director)

4. MINA PATEL (Director)

5. SITARAM PATEL (Director)

6. RAMKANHAI SONI (Director)

7. Regional Director (NWR), Ahmedabad

8. Guard File

9. And will also be uploaded on MCA Website.

The adjudication notice stands disposed of with this order.
Sitaram Sharan Gupta
Adjudicating officer
Registrar of Companies Chhattisgarh-
Bilaspur (C.G.)

Signed on this 22 day of December 2023
Place: Bilaspur, Chhattisgarh.