The Ministry of Corporate Affairs (MCA) in India has issued a penalty against Pantheryx (India) Private Limited for failing to appoint a director in accordance with Section 149 of the Companies Act, 2013. This article delves into the details of the case, the implications of the penalty, and the legal framework that surrounds it.
1. Appointment of Adjudicating Officer
The MCA designated the Registrar of Companies, NCT of Delhi & Haryana, as the Adjudicating Officer, responsible for assessing penalties under the Companies Act, 2013, and the Companies (Adjudication of Penalties) Rules, 2014. This appointment was made through a Gazette Notification.
2. About the Company
Pantheryx (India) Private Limited, a company incorporated under the Companies Act, 1956, had its registered office at Res Cowork15, 10th Floor, Tower-B, Unitech Cyber Park, Sector – 39, Gurgaon, Haryana, 122003. The financial details of the company for the fiscal year 2021-22 were provided.
3. Facts about the Case
The case centers on Pantheryx (India) Private Limited’s failure to comply with Section 149 of the Companies Act. The company admitted non-compliance and explained that the delay in appointing a director was linked to international factors, particularly COVID-19-related restrictions.
4. Factors Considered for Adjudication
The company was found to have defaulted by delaying the appointment of a new director to its board. The delay spanned 304 days, from 11.02.2020 to 10.12.2020. This constituted a violation of Section 149(1) of the Act.
5. Relevant Provisions of the Act
The pertinent sections of the Companies Act include Section 149(1)(a), which mandates a minimum number of directors for different types of companies. Section 172 of the same Act deals with penalties for non-compliance with provisions related to directors’ appointment.
6. Adjudication of Penalty
The company’s non-compliance was not considered a case for remission, as the law prescribes a fixed penalty for such defaults. The penalty was imposed based on the number of days of default and was calculated in accordance with Section 172 of the Act.
7. Conclusion
In conclusion, Pantheryx (India) Private Limited faced penalties for not appointing a director within the required time frame, in violation of Section 149 of the Companies Act, 2013. The company cited international factors, particularly the COVID-19 pandemic, as the cause for the delay. This case emphasizes the importance of complying with regulatory requirements and the consequences of non-compliance. Companies are advised to adhere to these regulations to avoid penalties and legal repercussions.
The parties involved have the option to file an appeal within 60 days from the date of the order to address any concerns related to the penalty.
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GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS,
OFFICE OF REGISTRAR OF COMPANIES,
NCT OF DELHI & HARYANA
4TH FLOOR, IFCI TOWER, 61, NEHRU PLACE,
NEW DELHI -110019
ORDER OF PENALTY UNDER SECTION 149 OF THE COMPANIES ACT, 2013 IN THE MATTER OF PANTHERYX (INDIA) PRIVATE LIMITED (CIN: U24233HR2007PTC037028)
1. Appointment of Adjudicating Officer: –
Ministry of Corporate Affairs vide its Gazette Notification No. A-42011/112/2014-Ad.11, 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. PANTHERYX (INDIA) PRIVATE LIMITED (herein after known as ‘company’) incorporated under the Companies Act, 1956 having its registered office as per MCA21 Registry at address Res Cowork15, 10th Floor, Tower-B, Unitech Cyber Park, Sector – 39, Gurgaon, Gurgaon, Haryana, 122003. The financial & other details of the subject company for immediately preceding F.Y 2021-22. as available on MCA-21 portal is stated as under:
| S. No. |
Particulars | Details |
| 1. | Paid up capital (Rs. in hundreds) | 1,60,838 |
| 2. | a. Revenue from operation (Rs. in hundreds) | 56,101 |
| b. Other Income (Rs. in hundreds) | 77,795 | |
| b. Profit for the Period (Rs. in hundreds) | 55,386 | |
| 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 | NO |
| Act? |
3. Facts about the Case: –
i. This office is in receipt of application on 08.05.2023 (GNL 1 SRN F61221958) wherein the company has admitted non-compliance of Section 149 of the Act and it is stated that in the financial year ended 31st March, 2019, Mr. Scott An Hyman, Mr. Mark Anthony Braman and Mr. Anurag Misra were the Directors of the Company. A board meeting was held on 27.01.2020, meanwhile directors of the company Mr. Mark Anthony Braman and Mr. Scott Ari Hyman resigned from the Board of the Company w.e.f. 07.01.2020 and 10.02.2020 respectively. In order to increase the number of Directors for constituting the quorum for a meeting of the Board, Mr. Wesley Amberg Parris was appointed as an Additional Director on the Board of the Company w.e.f. 11.12.2020.
ii. Accordingly, an SCN was issued on 28.08.2023 in response to which company submitted a reply on 06.09.2023. In view of submissions made in reply, a hearing in the matter was scheduled for oral submissions on 25.09.2023.
iii. Sh. Vishal Yadav (Advocate) appeared for hearing and reiterated the written submissions.
It is also noted that the non-compliance on the part of the company is not only limited to the gap between two successive board meetings but it also extends to not holding the minimum numbers of board meetings in a year.
The authorized representative of the company has explained that the default is intrinsically linked to delay in appointment of the second director. He has stated that in this case, the company had intended to appoint a foreign director but due to COVID restrictions prevalent across the world, necessary documentation could not be prepared on time, which has led to this delay. The defaults relating to holding of board meeting are of incidental nature.
The authorized representative finally prayed for a lenient view in this matter considering the fact that they have admitted the default through a suo-moto application.
4. Factors considered for adjudication of penalties: –
i. It is observed that the subject company had made default in appointing new director on its board meeting with a delay of 304 days i.e from 11.02.2020 to 10.12.2020.
ii. In view of above, company failed to comply with the provisions of Section 149(1) of the Act.
5. The relevant provisions of the Act are as follows:
Section 149(1) (a) of the Companies Act:
(1) Every company shall have a Board of Directors consisting of individuals as directors and shall have—
(a) a minimum number of three directors in the case of a public company , two directors in the case of a private company , and one director in the case of a One Person Company.
The relevant Section 172 of the CHAPTER XI APPOINTMENT AND QUALIFICATIONS OF DIRECTORS
(Penalty)
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.
6. Adjudication of penalty: –
i. 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.
ii. The submission of the company regarding granting any remission in the penalty cannot be considered as the law provides for a fixed penalty in this case.
iii. Now in exercise of the powers conferred on me vide Notification dated 24th March, 2015 and having considered the reply submitted by the noticee (s) in response to the notice issued on 06.09.2023 and hearing held in the matter on 25.09.2023, I do hereby impose the penalty on the company and its officer in default for violation of Section 149 of the Act r/w section 172 of the Companies Act, 2013 which are as follows:-
TABLE-1
| Violation | Penalty imposed on company/ Officers |
No. of days of default |
Calculation for penalty amount (in Rs.) |
Penalty imposed u/s 172 of the Act (in Rs.) |
| A | B | C | D | E |
| Under section 149 of the Act by appointing new director on its board meeting with a delay |
PANTHERYX (INDIA) PRIVATE LIMITED (company) |
304 | 50,000+(304×500) =2,02,000 Or 3,00,000 whichever is less |
2,02,000 |
| ANURAG MISRA
(director) |
304 | 50,000+(304×500) =2,02,000 Or 1,00,000 whichever is less |
1,00,000 |
7. Order:
a. Names of parties as mentioned in the table I above are hereby directed to pay the penalty amount as per column no. ‘E’ 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 www.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 www.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 noncompliance of this order.
(Pranay Chaturvedi, ICLS)
(Adjudicating Officer)
Registrar of Companies
NCT of Delhi & Haryana
No. ROC/D/Adj/Order/Section 149/Pantheryx/3920-3922 Dated: 17/10/2023
