Introduction: The Ministry of Corporate Affairs has imposed penalties on Triveni Nidhi Limited and its directors for not mentioning Din under Signature in Financial Statements. This article provides a detailed analysis of the violation, the penalties imposed, and the appeal process.
Detailed Analysis: Triveni Nidhi Limited, registered under the Companies Act, failed to mention the Director Identification Number (DIN) in its financial statements for the years 2018-19 and 2019-20. Despite multiple notices and summons, neither the company nor its directors responded. Consequently, penalties under Section 158 read with 172 of the Companies Act, 2013, were imposed.
Section 158 mandates companies to mention the DIN while furnishing returns or information related to directors. Failure to comply attracts penalties. In this case, the default persisted from 30th October 2019 to 30th October 2020.
The penalty, amounting to Rs. 1,00,000/- (Rupees one Lakh only) per director, was imposed on the concerned individuals. The Noticee is required to pay the penalty via Demand Draft in favor of “Pay & Accounts Officer, Ministry of Corporate Affairs, New Delhi,” payable at Delhi, within 90 days of receiving the order.
Conclusion: This penalty serves as a reminder of the legal obligations companies and directors must fulfill under the Companies Act. The imposed penalties underline the significance of compliance, and companies are urged to adhere to statutory requirements to avoid legal repercussions. Directors facing penalties have the option to appeal within sixty days from the order’s receipt, following the specified process outlined in the Companies Act, 2013.
For more detailed information on this case and the legal implications of non-compliance, individuals and businesses are encouraged to consult legal experts or regulatory authorities to ensure adherence to the Companies Act and related laws.
GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
OFFICE OF REGISTRAR OF COMPANIES,
UTTAR PRADESH,
37/17, Westcott Building, The Mall,
Kanpur — 208001 (U.P.)
Phone : 0512 — 2310323/2310443
BY SPEED POST
NO.07/01/ADJ-158/ TRIVENI NIDHI LIMITED/
DATE. 14/09/2023
ORDER FOR VIOLATION OF SECTION 158 OF THE COMPANIES ACT, 2013 READ WITH COMPANIES (ADJUDICATION OF PENALTIES) RULES, 2014.
IN THE MATTER OF TRIVENI NIDHI LIMITED
1. The Ministry of Corporate Affairs vide its gazette notification no A-42011/112/2014-Ad.11 dated 24.3.2015, has appointed the undersigned as Adjudicating Officer in exercise of the powers conferred by section 454 of the Companies Act, 2013 (hereinafter known as Act) read with Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.
2. Whereas the Company M/s TRIVENI NIDHI LIMITED has been registered under the provisions of Companies Act on 20.02.2015, and is having its registered office situated at 11B/1A/2 LALA RAM NARAIN LAL ROAD (BANK ROAD),ALLAHABAD- Uttar Pradesh,21 1002. The authorized capital of the company is Rs. 1,00,00,000/-
3. Whereas on scrutiny of the records, it is found that the company is not conducting its business as per the provisions of the Companies Act, 2013. It has been observed from the financial statements filed by the company for the financial year 2018-19, 2019-2020 that the Directors have not mentioned their Din under the signatures.Therefore, the matter was taken up with the company and its directors vide Inquiry letter no.TC/TECH/NIDHI/ TRIVENI /1771-1775 dated 16.10.2020. Further, neither the company nor the directors furnished any reply to the same. Thereafter, summons under section 207 of the Companies Act, 2013 vide letter no.TC/TECH/NIDHI/ TRIVENI /2322 to 2325 dated 24.11.2020 for appearance on 08.12.2020. and Show Cause Notice No.01/21//Inq/Nidlii/ TRIVENI -2021/2484-2488 dated 03.01.2022 and No.01/21//Inq/Nidhi/ TRIVENI -2021/3511-3515 dated 10.03.2022. Further none of the Directors of the company appeared on the said date of the hearing. The report in this regard furnished to the Regional Director, Northern Region wherein non-compliance of section 158. The Directorate vide its letter No.Inquiry/206(4)/ TRIVENI NIDHI /RD(NR)/2022/3320 dated 10.06.2022 has accorded the penal action under section 158 read with 172 of the Companies Act, 2013. Thus, it is evident that the company and its Directors have failed to comply with the provisions of section 158 of the Companies Act, 2013, in mentioned their Din under the signatures in the financial statements filed by the company for the financial year 2018-19, 2019-2020. And are thus liable for penal provisions.
Section 158 of the Companies Act, 2013 provides that: ‑
“Every person or company, while furnishing any return, information or particulars as are required to be furnished under this Act,shall mention the Director Identification Number in such return, information or particulars in case such return, information or particulars relate to the director or contain any reference of any director..”
Section 158 read with 172 of the Companies Act, 2013 provides that
4. “If a company contravenes any of the provisions of this Chapter and for which no specific 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.”
5. Accordingly, a Show Cause Notice No. . 07/01/Adjudication-158/ TRIVENI NIDHI LIMITED /2219-2223 dated 23.05.2023 was issued to the company and its officers in default under section under Section 158 of the Companies Act, 2013, read with Companies (Adjudication of Penalties) Rules, 2014 by this office.
6. The company and its officers in default have failed to furnish any reply to the said Show Cause Notice, hence no hearing was fixed for this matter.
7. Further, neither any representative of the company nor its directors have either furnished their reply or have appeared before the undersigned which has further strengthened the apprehension that the company and its Directors have failed to comply with the provisions of section 158 of the Companies Act, 2013, in respect of non-mentioning of their Din under the signatures in the financial statements filed by the company for the financial year 2018-19, 2019-2020, thereby attracting the penal provisions mentioned under Section 172 of the Act.
8. The date of default in the matter has been taken as 30.10.2019 and 30.10.2020, i.e. the date upto which a copy of the financial statements, including consolidated financial statement, if any, along with all the documents which are required to be or attached to such financial statements under this Act, duly adopted at the annual general meeting of the company, shall be filed with the Registrar within thirty days of the date of annual general meeting in such manner, with such fees or additional fees as may be prescribed. The default has been continuing since then.
9. Having considered the facts and circumstances of the case and after taking into account the factors above, I hereby impose a penalty of Rs.1,00,000/-(Rupees one Lakh only maximum as per section 172 of the Act on each Director for failure to make compliance of the section 158 of the Companies Act, 2013. It is of this opinion that penalty is commensurate with the aforesaid failure committed by the Noticee.
10. The Noticee shall pay the amount of penalty by way of Demand Draft in favour of “Pay & Accounts Officer, Ministry of Corporate Affairs, New Delhi, payable at Delhi, within 90 days receipt of this order. The Demand Draft shall be forwarded to this office Address.
11. Appeal against this order may be filed in writing with the Regional Director (Northern Region), Ministry of Corporate Affairs, CGO Complex, Lodi Road, New Delhi, 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 a certified copy of this order. [Section 454(5) & 454(6) of the Act, read with Companies (Adjudication of Penalties) Rules, 2014].
12. Attention is also invited to section 454(8) of the Companies Act, 2013, in the event of noncompliance of this order. In Case appeal is made 0/o Registrar of Companies, U.P. aybe informed alongwith the penalty imposed & the payments made.
NO.07/01/ADJ-158/ TRIVENI NIDHI LIMITED/4285 to 4289
