The Registrar of Companies, Gujarat, Dadra & Nagar Haveli, issued an adjudication order regarding the violation of Section 117 of the Companies Act, 2013 by Starnet Real Estate Development Limited (formerly known as Starnet Software (India) Limited). The company had failed to file a special resolution within the stipulated time period.
The order states that the members of the company had passed a special resolution to alter the main objects clause of the Memorandum of Association at an Extraordinary General Meeting held on January 30, 2021. As per Section 117 of the Companies Act, 2013, the resolution was required to be filed within 30 days. However, the company filed the required form, MGT-14, with a delay of 261 days.
The company attributed the delay to inadvertence and the second wave of the COVID-19 pandemic. They claimed there was no fraudulent intention or malafide involved. The adjudication application requested leniency in imposing the penalty.
After considering the documents and information submitted, the Adjudicating Officer imposed a penalty on the company and its directors. The company and its directors were instructed to individually pay the penalty amount through e-payment within 90 days of the order. Failure to comply with the order could result in further penalties and prosecution.
The order also mentioned that an appeal against the order could be filed within 60 days with the Regional Director, Ministry of Corporate Affairs. It cautioned that non-compliance with the order could lead to additional fines and imprisonment.
Copies of the order were sent to Starnet Real Estate Development Limited and the respective directors. Additional copies were sent to the Ministry of Corporate Affairs and the Regional Director for information purposes.
GOVERNMENT OF INDA
MINISTRY OF CORPORATE AFFAIRS
OFFICE OF THE REGISTRAR OF COMPANIES,
GUJARAT, DADRA & NAGAR HAVELI
Order NO. 164 to 170 Dated: 06 Apr 2022
BEFORE THE ADJUDICATING OFFICER
REGISTRAR OF COMPANIES, GUJARAT, DADRA & NAGAR HAVELI
IN THE MATTER OF ADJUDICATION OF PENALTY UNDER SECTION 454 (3) OF THE COMPANIES ACT 2013 READ WITH RULE 3 OF THE COMPANIES (ADJUDICATION OF PENALTIES) RULES, 2014 FOR VIOLATION OF SECTION 117 OF THE COMPANIES ACT, 2013 READ WITH RULES MADE THEREUNDER
IN THE MATTER OF STARNET REAL ESTATE DEVELOPMENT LIMITED
[FORMERLY KNOWN AS STARNET SOFTWARE (INDIA) LIMITED
Date of hearing- 30.03.2022
1. Shri M. K. Sahu (ROC), Adjudicating Officer
2. Gajanan Kate (AROC), Presenting Officer
3. Kavith a. Varadaraju, JTA
Appointment of Adjudication Authority:-
1. The 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 under section 454 of the Companies Act, 2013 (hereinafter known as Act) read with Companies (Adjudication of Penalties) Rules, 2014 (Notification No. GSR 254(E) dated 31.03.2014) for adjudging penalties under the provisions of Act.
2. Whereas STARNET REAL ESTATE DEVELOPMENT LIMITED (herein after referre d to as “company”) is a company registered under the provisions of the Companies Act, 1956/2013 in the State of Gujarat, having CIN: U45100GJ2000PLC038987 and presently having its registered office situated at “Ganesh Corporate House,100 Feet Hebatpur – Thaltej, Road, Near Sola Bridge, off S.G. Highway, Ahmedabad. Gujrat. 380054. India.
3. The Company STARNET REAL ESTATE DEVELOPMENT LIMITED with CIN U45100GJ2000PLC038987 was earlier known as STARNET SOFTWARE (INDIA) LIMITED having CIN U72200GJ2000PLC038987. This office was in receipt of MGT-14 vide SRN T84067107 dated 02.03.2022 and INC-24 vide SRN T84875632 dated 07.03.2022 to change its name from STARNET SOFTWARE (INDIA) LIMITED to STARNET REAL ESTATE DEVELOPMENT LIMITED. Both the above e-forms were approved by this office on 15.03.2022 and 24.03.2022 respectively.
Fact about of the case:
4. The members of the Company have passed Special Resolution unanimously in accordance with section 13 and other applicable provision of the Act, if any at their Extra-ordinary General Meeting held on Saturday 30th January 2021 at the registered office of the Company pertaining to alter the main objects clause of Memorandum of Association of the Company in the manner described in the said resolution.
5. Pursuant to provisions of Section 117 of the Act, the aforesaid special resolution passed by the members of the company unanimously in accordance with section 13 and other applicable provision of the Act if any at their Extra-General Meeting held on Saturday, 30th January 2021, the said resolution was required to be filed within 30 days (i.e. on or before 01.03.20211 in the form MGT-14 thereof, however the company could not file the aforesaid form MGT-14 within stipulated time and the same was filed on 17/11/2021 vide SRN T59033126 with delay of 261 days.
6. The suo-moto application submits that the delay in filing the particulars of the Special resolution was inadvertently and without any malafide or wilful intention and due to second wave of covid-19. The applicants submits that there was no fraudulent intention or move.
7. Section 117 of the Companies Act, 2013:
1. (1) A copy of every resolution or any agreement, in respect of matters specified in sub-section (3) together with the explanatory statement under section 102, if any, annexed to the notice calling the meeting in which the resolution is proposed, shall be filed with the Registrar within thirty days of the passing or making thereof in such manner and with such fees as may be prescribed:
2. Provided that the copy of every resolution which has the effect of altering the articles and the copy of every agreement referred to in sub-section (3) shall be embodied in or annexed to every copy of the articles issued after passing of the resolution or making of the agreement.
3. (2) If any company fails to file the resolution or the agreement under sub-section (1) before the expiry of the period specified therein, such company shall be liable to a penalty of ten thousand rupees and in case of continuing failure, with a further penalty of one hundred rupees for each day after the first during which such failure continues, subject to a maximum of two lakh rupees and every officer of the company who is in default including liquidator of the company, if any, shall be liable to a penalty of ten thousand rupees and in case of continuing failure, with a further penalty of one hundred rupees for each day after the first during which such failure continues, subject to a maximum of fifty thousand rupees./.
Show Cause Notice, reply and personal Hearing:-
8. Thereafter, a “written Notice” vide email dated 17.03.2022 was issued to the company and its representative/ authorized person of the company Mr. Karan Shah Practicing Chartered Accountant , and a hearing was fixed for 23.03.2022. 0/ the Scheduled date of hearing i.e. on 23.03.2022, representative/ authorized person of the company Mr. Karan Shah, Practicing Chartered Accountant appeared and attended the hearing proceedings and requested for adjournment of the hearing.
9. Later the hearing was held on 30.03.2022 on request of Company’s representative/ authorized person Mr. Karan Dhiren Shah practicing Chartered Accountant. During the hearing, ltd. Chartered Accountant Mr. Karan Dhiren Shah submitted that the shareholders of the Company vide their extra ordinary General meeting dated 30.01.2021 had decided to change the object clause of the Company from IT reated matters to Real estate object. Mr. Karan Dhiren Shah has also clarified that relevant MGT-14 vide SRN no. T59033126 is already filed in the 0/o ROC on dated 17.11.2021. However since there is a delay of 261 days beyond the statutory permissible period the Company & its directors as the case may be have filed suo-moto adjudication application to make the default good.
However , the ltd CA. Mr. Karan Dhiren Shah has drawn the kind attention of the Adjudicating officer towards Sec 454 (3) of Companies Act 2013 and requested for minimum possible penalty. During argument it was conveyed that since the statute has filed Rs. 10,000 as fixed penalty & Rs. 100 per day for continuing offence and also fixed penalty the maximum cap Rs. 2,00,000. Using of discretion in that given case may not be appropriate
10. Under the aforesaid factual matrix, the adjudication application, submitted documents & additional information in the matter are perused, considered & taken on record. Accordingly taking into account of delay of 261 days and the company & 5 of its officers being in default and under the provisions of Section 117 (3) of
Companies Act 2013 regarding violation of section 117 of Companies Act 2013, the penalty imposed is as under:
11. The noticee shall pay the amount of penalty individually for the company and its directors (out of own pocket) by way of e-payment (available on Ministry website mca.gov.in) under “Pay miscellaneous fees” category in MCA fee and payment Services within 90 (ninety) days of this order and the Challan/SRN generated after payment of penalty through online mode shall be filed in INC-28 to this office.
12. Appeal if any against this order may be filed in writing with the Regional Director, North Western Region, Ministry of Corporate Affairs, ROC BHAVAN, OPP. RUPAL PARK, NR. ANKUR BUS STAND, NARANAPURA, AHMEDABAD (GUJARAT)-380013 within a period of sixty days from the date of receipt of this order, in Form ADJ setting forth the grounds of appeal and shall be accompanied by the certified copy of this order. [Section 454 of the Companies Act, 2013 read with the Companies (Adjudicating of Penalties) Rules, 2014 as amended by Companies (Adjudication of Penalties) Amendment Rules, 2019] .
13. Please note that as per the provisions of Section 454(8) (i) of the Companies Act, 2013, where company does not pay the penalty imposed by the Adjudicating Officer or the Regional Director within a period of Ninety days (90 days)from the date of the receipt of the copy of order, the company shall be punishable with fine which shall not be less than twenty five thousand rupees but which may extend to five lakhs rupees. Further as per of Section 454(8) (ii) of the Companies Act, 2013, where an officer of a company who in default does not pay the penalty within a period of Ninety days (90days) from the date of receipt of the copy of the order, such officer 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 with both.
14. Your attention is also invited to section 454(8) of the Act in the event of non-compliance of this order which provides that in case of default in payment of penalty, prosecution will be filed u/s 454(8)(ii) of the Companies Act, 2013 at your own costs without any further notice.
The adjudication notice stands disposed of with this order.
(M. K. SAHU) (ICLS)
Registrar of Companies & Adjudicating Officer
Gujarat, Dadra & Nagar Haveli
1. STARNET REAL ESTATE DEVELOPMENT LIMITED
[FORMERLY KNOWN AS STARNET SOFTWARE (INDIA) LIMITED]
GANESH CORPORATE HOUSE,
100 FEET HEBATPUR – THALTEJ,ROAD,
NEAR SOLA BRIDGE, OFF S.G. HIGHWAY,
2. HARSHIT RAJNIKANT SHAH (DIN 00005882)
30 MANIRATNAM ROW HOUSE
PART 2B/H P AND T COLONY VASNA,
3. ASHISH HARISHKUMAR MODI (DIN 02506019)
HARIDWAR 49, SANGRILA VILLAGE,
JAGDISHNAGARCO HOUSING SOC.,
NR PLEASURE CLUB GHUMA,
AHMEDABAD-380058. GUJARAT. INDIA.
4. KUSHAL YOGENDRAKUMAR JOSHI (DIN 06852596)
1. A-502, MALABAR COUNTY-I, B/H NIRMA UNIVERSITY,
DR. AMBEDKAR UNIVERSITY ROAD, CHHARODICHANDLODIY
AHMEDABAD-382481. GUJARAT. INDIA.
5. MAHESH RANCHHODBHAI PATEL (DIN 06852605)
22, VASNA GAM, PATEL VAS MAKTUMPURA,
OPP G.B. SHAH COLLEGE, VASANA,
6. MR. KRUNAL NANDUBHAI PATEL (DIN 07386611)
C/32, J.V. PARK SOCIETY,
GST CROSSING ROAD, RANIP,
(M. K. SAHU) (ICLS)
Registrar of Companies & Adjudicating Officer
Gujarat, Dadra & Nagar Haveli.
Ministry of Corporate Affairs, (Through Proper Channel)
The Regional Director, (NWR), Ministry of Corporate Affairs, Ahmedabad-380013
(for information please)