Non-Disclosure of Proxy Rights in AGM Notices Attracts Statutory Penalty

The Registrar of Companies, Chennai passed an adjudication order on 5 January 2026 imposing a penalty for violation of proxy-related disclosure requirements under the Companies Act, 2013. Following an inspection under Section 206(5), it was observed that notices of Annual General Meetings held between 2016 and 2020 did not give reasonable prominence to members’ rights to appoint proxies and the rights of proxies to attend and vote, as mandated under Section 105(2). As a result, liability arose under Section 105(3). The company had been struck off in October 2019, and one director had expired, leaving action to be taken only against the surviving director. Despite issuance of notices and an opportunity of hearing, no response or appearance was made, and the proceedings were conducted ex parte. The Adjudicating Officer imposed a penalty of ₹5,000 on the director, payable from personal funds, with directions for payment within 90 days and an option to appeal before the Regional Director, Chennai.

GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
ROC Chennai
Registrar Of Companies, Block No.6,B Wing 2nd Floor, Shastri Bhawan 26, Haddows Road, Chennai, Tamil Nadu, India, 600034
Phone: 044-28276652/28276654
E-mail: roc.chennai@mca.gov.in

Order ID: PO/ADJ/12-2025/CN/01085 | Dated: 05/01/2026

ORDER FOR ADJUDICATION OF PENALTY UNDER SECTION 454 OF THE COMPANIES ACT, 2013 (‘THE ACT’) FOR VIOLATION OF SECTION 105(3) OF THE COMPANIES ACT, 2013.

A. Appointment of Adjudicating Officer:

Ministry of Corporate Affairs vide its  Gazette notification number S.O. 831(E) dated 24/03/2015appointed undersigned as Adjudicating Officer in exercise of the powers conferred by section 454 of the Companies Act, 2013 [herein after known as Act] read with Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.

B. Company details:

In the matter relating to APS LIFE SCIENCES PRIVATE LIMITED_____________

Individual details:

In the matter relating to AVOODAIYAPPAN SELVAKUMAR________________

C. Provisions of the Act:

If default is made in complying with sub-section (2), every officer of the company who is in default shall be [liable to penalty of five thousand rupess].

D. Facts about the case:

1. Default committed by the officers in default/noticee – An inspection of books and accounts and other records of APS Life Sciences Private Limited (CIN: U74900TN2014PTC098038) was conducted under Section 206(5) of the Companies Act 2013 by an Officer authorized by the Central Government wherein the observations of the Inspecting Officer are as follows: “On examination of Annual General Meetings held in 2016,2017,2018,2019 and 2020, it is seen that there is no such compliance prima facie (i.e pertaining to reasonable prominence) in the notices with regard to Rights of member to appoint proxies and the rights of proxies to attend and voter there at and that the proxy voted not be member etc. Hence, the company has violated Section 105(2) of the companies Act, 2013″.

It is noticed that the company was struck off on 25.10.2019 and as per the Para 27.1 & 28.1 of the Inspection report, the director Mr.Avoudiappan Senthilvelu (DIN: 2974637) was expired on 17.07.2020. Hence, action shall be taken against Mr. Avoodaiyappan Selvakumar (DIN: 03073730) only.

2. The Adjudicating Authority had issued notice for e- Adjudication on 20.02.2025, but no reply has been received from the director Mr. Avoodaiyappan Selvakumar (DIN: 03073730). Further, the Adjudicating Authority had issued notice on 18.03.2025 for hearing scheduled on 20.03.2025. Neither the director nor his authorized representative attended the hearing fixed on 20.03.2025, therefore as per Rule 3(8) of Companies (Adjudication of Penalties) Rules 2014, the matter is being proceeded with in the absence of such person (ex-parte).

E.Order:

1. It is noticed on the examination of the Annual General Meetings held in 2016, 2017, 2018, 2019 and 2020, there is no compliance prima facie (i.e., pertaining to reasonable prominence) in the notices with regard to Rights of member to appoint proxies and the Right of proxies to attend and vote there at and that the proxy voted not to be member etc. Hence, the company has violated Section 105(2) of the Companies Act, 2013.

Further it is noticed that the Company was struck off on 25.10.2019 and the Director, Mr. Avoudiappan Senthilvelu (DIN: 2974637) was expired on 17.07.2020. Therefore the Director Mr. Avoodaiyappan Selvakumar (DIN: 03073730) is liable as per the provisions of Section 105(3) of the Companies Act, 2013.

2. The details of penalty imposed on the company, officers in default and others are shown in the table below:

3. The notified officers in default/noticee shall rectify the default mentioned above and pay the penalty, so applicable within 90 days of receipt of the order.

4. The notified officers in default/noticee shall pay the penalty amount via ‘e-Adjudication’ facility which can be accessed through the respective login IDs on the website of Ministry of Corporate Affairs and upload the copy of paid challan / SRN of e-filing (if applicable) on the ‘e-Adjudication’ portal itself. It is also directed that the penalty so imposed upon the officers in default shall be paid from their personal sources/income.

5. Appeal against this order may be filed in writing with the Regional Director, RD Chennai within a period of sixty days from the date of receipt of this order, in Form ADJ setting for 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].

6. For penal consequences of non-payment of penalty within the prescribed time limit, please refer Section 454(8) of the Companies Act, 2013.

B SRIKUMAR,
Registrar of Companies
ROC Chennai