Ministry of Corporate Affairs (MCA) has imposed a significant penalty of ₹24 lakh on M/s Lions Co-ordination Committee of India Association for failing to disclose the number and dates of board meetings in their Board Reports for the financial years 2018-19 and 2019-20. This decision stems from the requirements set forth in Section 134(3)(b) of the Companies Act, 2013, which mandates that the number of meetings of the board should be disclosed in the Directors’ Report. Additionally, Secretarial Standard-4 reinforces this requirement by specifying that both the number and dates of board meetings must be included in the report.
Upon investigation, it was found that the company did not comply with these requirements. For the financial year 2018-19, the Directors’ Report failed to mention the number and dates of board meetings. In the subsequent financial year 2019-20, while the company did indicate that the interval between meetings was within the required period, it still did not disclose the actual dates of the meetings.
The inquiry led to an adjudication process where the Registrar of Companies in Chennai was appointed as the Adjudicating Officer. Notices were issued to the company and its directors, calling for explanations and setting dates for hearings. Despite some directors responding and appearing for the hearings, many did not, leading to an ex-parte decision for those absent.
The adjudicating authority concluded that the company and its directors violated Section 134(3)(b) and Secretarial Standard-4 for the stated financial years. Consequently, a penalty of ₹3 lakh was imposed on the company, and each director involved during the period of non-compliance was fined ₹50,000 each. The total penalty amount imposed on the company and its directors sums up to ₹24 lakh, reflecting the MCA’s firm stance on ensuring compliance with corporate governance norms.
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GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
OFFICE OF REGISTRAR OF COMPANIES, TAMIL NADU, ANDAMAN & NICOBAR ISLANDS, CHENNAI
II FLOOR, C- WING, SHASTRI BHAVAN, 26, HADDOWS ROAD, NUNGAMBAKKAM, CHENNAI- 6
F.NO.ROC/CHN/ADJILIONS CO/ S.134(3)(b)/2024 DATE: 25 JUN 2024
ADJUDICATION ORDER UNDER SECTION 134(3)(b) OF THE COMPANIES ACT, 2013
IN THE MATTER OF M/S LIONS CO-ORDINATION COMMITTEE OF INDIA ASSOCIATION
Non-disclosure of Number of Board meeting in Board Report: MCA imposes Penalty of ₹24 Lakh
1. Appointment of Adjudicating Officer: –
The Ministry of Corporate Affairs vide its Gazette Notification No. A-42011/112/2014-Ad.II, dated 24.03.2015 has appointed Registrar of Companies, Chennai as Adjudicating Officer in exercise of the powers conferred by section 454(1) of the Companies Act, 2013 (hereinafter referred as Act or Companies Act, 2013) r/w Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.
2. Company: –
Whereas the company viz. M/s. Lions Co-ordination Committee of India Association with CIN: U74999TN2016NPL110455 (herein after referred as ‘ company’ or ‘ subject company’) is a registered company with this office under the provisions of section 7 of the Companies Act, 2013 having its registered office as per MCA21 Registry at 96, Govindan Street, Collect orate Colony, Aminjikarai, Chennai, Tamil Nadu 600029. The financial & other details of the subject company as available on MCA-21 portal is stated as under:
| S. No. | Particulars | Information |
| 1. | Company’s Status | Active |
| 2. | Filing Status | Financial Statement: up to 31.03.2023
Annual Return: up to |
| 3. | Number of Members | 38 |
| 4. | Whether it is a Holding Company | NA |
| 5. | Whether it is a Subsidiary Company | NA |
| 6 | Whether company registered under Section 8 of the Act? | Yes |
| 7. | Whether company registered under any other special Act? | No |
3. Directors during the period of violation
| S. No. | Name of Director Default | Designation | Date of
Appointment |
Date of Cessation |
| 1. | VAZHAPPULLY PADMANABHAN NANDAKUMAR | Director | 13.09.2019 | 13.11.2020 |
| 2 | ROHITBHAI CHINUBHAI MEHTA | Director | 18.05.2016 | 17.09.2020 |
| 3. | PRAVINKUMAR CHHAJER | Director | 04.07.2017 | 22.09.2022 |
| 4. | SANJEEV MALCHAND CHHAJER | Director | 13.09.2019 | 09.09.2021 |
| 5. | SIVANANDA SANKAR | Director | 18.05.2016 | ….. |
| 6. | SUSHIEL KUMAR AGRAWAL | Director | 04.07.2017 | 13.03.2020 |
| 7. | PREM RATAN LAHOTY | Director | 18.05.2016 | 29.09.2022 |
| 8. | VENUMBAKA VENKATA KRISHNA REDDY | Director | 18.05.2016 | 30.09.2022 |
| 9. | RAJU VIJAYKUMAR MANWANI | Director | 04.07.2017 | 01.09.2022 |
| 10. | MURUGAN RATNASWAMY | Director | 18.05.2016 | 30.09.2020 |
| 11. | SUNIL KUMAR RUMALLA | Director | 18.05.2016 | 29.09.2022 |
| 12. | JAGDISH KUMAR GULATI | Director | 18.05.2016 | 29.09.2022 |
| 13. | SANGEETA JATIA | Director | 04.07.2017 | 25.09.2022 |
| 14. | JATINDER PAL SINGH | Director | 04.07.2018 | 10.09.2022 |
| 15. | SUNIL DHARNIDHAR VORA | Director | 13.09.2019 | 09.09.2021 |
| 16. | NARENDRA SHANTILAL BHANDARI | Director | 04.07.2017 | 29.09.2022 |
| 17. | RANGANATHAN SAMPATH | Director | 13.09.2019 | ….. |
| 18. | VIJAYA KUMAR RAJU VEGESNA | Director | 27.07.2016 | ….. |
| 20. | GURCHARAN SINGH HORA | Director | 18.05.2016 | 06.11.2020 |
| 21. | KUPPUSAMY DHANABALAN | Director | 04.07.2017 | 29.09.2022 |
| 22. | NAWAL MALU | Director | 19.03.2019 | 29.09.2022 |
4. Section and Penal Provision as per Companies Act, 2013
134 Financial Statement, Board’s Report, etc.
(3) There shall be attached to statements laid before a company in general meeting, a report by its Board of Directors, which shall include—
(a) the web address, if any, where annual return referred to in sub-section (3) of section 92 has been placed
(b) number of meetings of the Board;
(8) If a company is in default in complying with the provisions of this section, the company shall be liable to a penalty of three lakh rupees and every officer of the company who is in default shall be liable to a penalty of fifty thousand rupees
Part I- SS-4: Secretarial Standard on the Report of Board of Directors: Board Meetings:
The number and dates of meetings of the Board held during the year shall be disclosed in the Report
5. Issue of Adjudication Notice:
An Inquiry was conducted in the matter of M/s. Lions Co-ordination Committee of India Association under Section 206(4) of the Companies Act, 2013 by an Officer authorized by the Central Government wherein the observations of the Inquiry Officer are as follows:
“As per provision of Section 134(3)(b) of the Companies Act, 2013 read with Secretarial Standard-4, the number and dates of meetings of the Board held during the financial year shall be disclosed in the Board Report w.e.f 1st October 2018.It is observed from the Directors Report for the Financial Year 2018-19, the company has not disdosed number of Board meeting conducted and date of Board Meetings. Hence, the Company has not complied with Section 134(3)(b) read with Secretarial Standard -4 of the Companies Act, 2013 by not disclosing date of board meeting. Therefore, the company and officer in default are liable for penal action under section 134(8) of the Companies Act, 2013. Further, it is observed from Directors Report for the financial year 2019-20, the company has disclosed the maximum interval between any two meetings was well within the maximum period of one hundred and twenty days. However, as per provision of Section 134(3)(b) of the Companies Act, 2013, number of Board meeting conducted should be disclosed and as per Secretarial Standard -4, the company should disclose date of Board meetings conducted by the company. However, the company has not complied with provision of Section 134(3)(b) read with Secretarial Standard -4 of the Companies Act, 2013. Therefore, the company and officer in default are liable for penal action under section 134(8) of the Companies Act, 2013.
Accordingly, on submission of the Inquiry Report by the Officer, the Regional Director, Ministry of Corporate Affairs, Chennai has directed to initiate necessary action against the defaulters as per the provisions of the Companies Act, 2013.
The Adjudicating Authority had issued Notice No. ROC/CHN/110455/S.134(3)(b)/P.2/INQUIRY FOLLOW UP/ 2022 dt 08.09.2023 to the company and its directors.
6. Reply of Company and Directors for Adjudication Notice issued:
Pursuant to Adjudication Notice dt 08.09.2023, Shri. Vazhappully Padmanabhan Nandakumar, one of the directors of the company have filed Adjudication application in GNL-1 vide SRN: F83660084 dt 25.11.2023. After that, the Adjudicating Authority imposed penalty on Shri. Vazhappully Padmanabhan Nandakumar for the violation of Section 134(3)(b) of the Companies Act, 2013. Since no reply/information has been received from the company and other directors, it is decided to fix a final hearing to complete the adjudication proceedings.
7. Adjudication Hearing:
The Adjudicating Authority had issued notice of hearing dt 28.03.2024 to the company and directors except Shri. Vazhappully Padmanabhan Nandakumar by fixing the hearing on 08.04.2024. Pursuant to the notice dated 28.03.2024, Shri. P. Praveen Kumar, ACS appeared before the Adjudicating Authority on behalf of the company and directors namely Mr. Virinder Kumar Luthra, Mr. Jatinder Pal Singh, Mr. Nawal Jugal Kishor Malu and Mr. Ranganathan Sampath and made submissions that the violations may be adjudicated as per the provision of the Companies Act, 2013. Neither the other directors nor their representatives appeared before the Adjudicating Authority on the said date. Hence, as per Rule 3(8), Companies (Adjudication of Penalties) Rules 2014, the matter is being proceeded with in the absence of such persons (ex-parte).
(ii) The company is registered under Section 8 of the Companies Act,2013, therefore, does not fall under the definition of small company as per provision of Section 2(85) of the companies Act, 2013. Therefore, imposing the provision lesser penalty as per section 446(b) shall not be applicable in this case.
8. Analysis of non-compliance of Section 134(3)(b) of the Companies Act. 2013 r/w SS-4
It is observed that the Director’s reports for the FY 2018-19 does not disclose number and dates of meetings of the Board held during the year and the Director’s reports for the FY 2019-20 does not disclose the date of meetings. Hence, the company and its directors have violated Section 134(3)(b) of the Companies Act, 2013 r/w SS-4 for the financial years 2018-19 & 2019-20. There is no clarification received from the company regarding adoption of Secretarial Standard-4 and in the Suo-motto adjudication application filed by one of the directors of the subject company, the violation is with respect to Section 134(3)(b) of the Companies. Act, 2013 r/w Secretarial Standard-4. Therefore, the company and its directors are liable for penalty under Section 134(8) of the Companies Act, 2013.
9. Decision:
Having considered the facts and circumstances of the case and after taking into account the factors above, it is concluded that the company has violated Section 134(3)(b) of the Companies Act, 2013 for the FYs 2018-19 & 2019-20. Accordingly, I am inclined to impose a penalty on the company and its Officers in default as prescribed under Section 134(8) of the Companies Act, 2013. The details of the penalty imposed on the company and its directors is given below:
I. FY 2018-19
| S.No | Company and Directors | Penalty for default (Rs.) |
Maximum Penalty (Rs.) | Final Penalty Imposed (Rs.) |
| 1.. | M/s. LIONS CO- ORDINATION COMMITTEE OF INDIA ASSOCIATION | Rs.3,00,000/- | Rs.3,00,000/- | Rs.3,00,000/- |
| 2. | ROHITBHAI CHINUBHAI MEHTA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 3. | PRAVINKUMAR CHHAJER | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 4. | SANJEEV MALCHAND CHHAJER | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 5. | SIVANANDA SANKAR | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 6. | SUSHIEL KUMAR AGRAWAL | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 7, | PREM RATAN LAHOTY | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 8. | VENUMBAKA VENKATA KRISHNA REDDY | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 9. | RAJU VIJAYKUMAR MANWANI | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 10. | MURUGAN RATNASWAMY |
Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 11. | SUNIL KUMAR RUMALLA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 12. | JAGDISH KUMAR GULATI | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 13. | SANGEETA JATIA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 14. | JATINDER PAL SINGH | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 15. | SUNIL DHARNIDHAR VORA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 16. | NARENDRA SHANTILAL BHANDARI | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 17. | RANGANATHAN SAMPATH |
Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 18. | VIJAYA KUMAR – RAJU VEGESNA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 19. | GURCHARAN SINGH HORA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 20. | KUPPUSAMY DHANABALAN | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 21. | NAWAL MALU | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
Therefore, in view of the above said violation, in exercise of the powers vested to the undersigned under Section 454(1) & (3) of the Companies Act, 2013, penalty of Rs.3,00,000/- (Rupees Three lakhs) is imposed on the Company, Rs.50,000/- (Rupees Fifty Thousand) is imposed on each of the directors as mentioned above. Totally Rs.13,00,000/-(Rupees Thirteen lakhs) is imposed for violation of Section 134(3)(b) of the Companies Act, for the FY 2018-19.
II. FY 2019-20
| S.No | Company and Directors | Penalty for default (Rs.) |
Maximum Penalty (Rs.) | Final Penalty Imposed (Rs.) |
| 1. | M/s. LIONS CO- ORDINATION COMMITTEE OF INDIA ASSOCIATION | Rs.3,00,000/- | Rs.3,00,000/- | Rs.3,00,000/- |
| 2 | PRAVINKUMAR CHHAJER |
Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 3. | SANJEEV MALCHAND CHHAJER | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 4 | SIVANANDA SANKAR | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 5. | PREM RATAN LAHOTY | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 6. | VENUMBAKA VENKATA KRISHNA REDDY | Rs.50,000/- | Rs.50,000/- | Rs50,000/- |
| 7. | RAJU VIJAYKUMAR MANWANI | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 8. | SUNIL KUMAR RUMALLA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 9. | JAGDISH KUMAR GULATI | I- Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 10. | SANGEETA JATIA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 11. | JATINDER PAL SINGH | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 12. | SUNIL DHARNIDHAR VORA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 13. | NARENDRA SHANTILAL BHANDARI | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 14. | RANGANATHAN SAMPATH |
Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 15. | VIJAYA KUMAR RAJU VEGESNA | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 16. | KUPPUSAMY DHANABALAN | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
| 17. | NAWAL MALU | Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
Therefore, in view of the above said violation, in exercise of the powers vested to the undersigned under Section 454(1) & (3) of the Companies Act, 2013, penalty of Rs.3,00,000/- (Rupees Three lakhs) is imposed on the Company, Rs50,000/- (Rupees Fifty Thousand) is imposed on each of the directors as mentioned above. Totally Rs.11,00,000/-(Rupees Eleven lakhs) is imposed for violation of Section 134(3)(b) of the Companies Act, for the FY 2019-20.
10. The said amount of penalty shall be paid through online by using the website mca.gov.in(Misc. head) within 90 days of receipt of this order, and intimate this office with proof of penalty paid.
11. Whereas Appeal against this order may be filed with the Regional Director (SR), Ministry of Corporate Affairs, 5th Floor, Shastri Bhavan, 26 Haddows Road, Chennai-600006, Tamil Nadu 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].
12. Your attention is also invited to section 454(8) of the Act in the event of noncompliance of this order, “(8)(0 Where company fails to comply with the order made under sub-section (3) or sub-section (7), as the case may be within a period of ninety days from the date of the receipt of the copy of the order, the company shall be punishable with fine which shall not be less than twenty five thousand rupees but which may extend to Eve lakh rupees.
(ii) Where an officer of a company or any other person who is in default fails to comply with the order made under sub-section (3) or sub-section (7), as the case may be within a period of ninety days from the date of the 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.”
(B. SRIKUMAR, ICLS)
REGISTRAR OF COMPANIES
TAMILNADU, CHENNAI.
ADJUDICATING OFFICER
