Non-filing of AGM proceedings with financials – MCA imposes penalty

Editor6 18 May 2023 14,664 Views 1 comment Print Company Law | Featured, Notifications/Circulars, Orders

MCA imposes penalty under section 378ZA(10) of section 378ZA(10) of Companies Act, 2013 as company failed to file proceedings of the annual general meeting, along with report of Board of Directors, audited balance sheet, and profit and loss statements.

The Office of the Registrar of Companies, Bihar-Cum-Official Liquidator, High Court, Patna has issued an order for penalty against M/s. SP Global Kisan Producer Company Limited for violating section 378ZA(10) of the Companies Act, 2013. The company failed to file the proceedings of the annual general meeting, along with the report of the Board of Directors, audited balance sheet, and profit and loss statements for the financial years 2014-2015 to 2021-2022.

The office had previously issued a show cause notice to the company, but no response was received from the company or its directors. As a result, the Registrar has determined that the company and its directors/officers are liable for a penalty under section 450 of the Companies Act, 2013.

Section 378ZA(10) of the Companies Act, 2013 states that the proceedings of every annual general meeting, along with the report of the Board of Directors, audited balance sheet, and profit and loss account, should be filed with the Registrar within sixty days of the meeting, along with the annual return and applicable filing fees.

Section 450 of the Act imposes a penalty of ten thousand rupees on a company, its officers, or any other person for contravening the provisions of the Act. In the case of a continuing contravention, a further penalty of one thousand rupees per day may be imposed, up to a maximum of two lakh rupees for a company and fifty thousand rupees for an officer in default.

Additionally, Section 446B stipulates that if a penalty is payable for non-compliance by a One Person Company, small company, start-up company, or Producer Company, the penalty shall not exceed one-half of the specified penalty, with a maximum limit of two lakh rupees for a company and one lakh rupees for an officer in default.

Based on the facts and provisions of the Companies Act, the Registrar has imposed a penalty of Rs. 5,50,100 on the company and Rs. 188,500 each on the five directors/officers in default.

Office of the Registrar of Companies,
Bihar-Cum-Official Liquidator, High Court, Patna
4th Floor, ‘A’ Wing, Maurya Lok Complex
Dakbunglow Road, Patna-800001

Order No.: ROC/PAT/Sec. 378ZA/21876/299 Dated: 18.05.2023

Order for penalty for violation of section 378ZA(10) of the Companies Act, 2013
In the matter of
M{/S. SP GLOBAL KISAN PRODUCER COMPANY LIMITED,
CIN: U01403BR2014PTCO21876

Appointment of Adjudication Officer:–

1. The Ministry of Corporate Affairs vide its Gazette Notification No. A-42011/112/2014- Ad.11 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 (herein after known as Act) read with Companies (Adjudication of Penalties) Rules, 2014 for adjudging penalties under the provisions of this Act.

Company:–

2. Whereas Company M/s. SP Global Kisan Producer Company Limited, CIN-U01403BR2014PTCO21876 (herein after known as Company) is a registered company with this office under the provisions of the companies Act, 2013/1956 (or previous Acts in force, as applicable) having its registered office situated at Ganga Palace, 3rd Floor, Near Dinkar Golamber, Arya Kumar Road, Patna, Bihar, 800004, India as per MCA website.

Facts about the case:–

3. Whereas, it is observed that the company has not filed its proceedings of annual general meeting alongwith the report of the Board of Directors, the audited balance sheet and profit and loss for the financial years 2014-2015 to 2021-2022 as per the MCA portal. Hence, this office has issued show cause notice for default under section 378ZA of the Companies Act, 2013 vide No. ROC/PAT/SCN/Sec.378ZA/21876/68-73 dated 06.04.2023.

4. Whereas, this office has not received any reply from the company and its directors. Hence, it appears that Section 378ZA(10) of the Companies Act, 2013 has been contravened by the company and its directors/officers and therefore they are liable for penalty u/s. 450 of Companies Act, 2013.

5. Sections 378ZA(10), 450 are reproduced as under:-

As per Section 378ZA(10) of the Companies Act, 2013: The proceedings of every annual general meeting alongwith the report of the Board of Directors, the audited balance-sheet and the profit and loss account shall be filed with the Registrar within sixty days of the date on which the annual general meeting is held, with an annual return alongwith the filing fees as applicable under the Act.

Section 450: If a company or any officer of a company or any other person contravenes any of the provisions of this Act or the rules made thereunder, or any condition, limitation or restriction subject to which any approval, sanction, consent, confirmation, recognition, direction or exemption in relation to any matter has been accorded, given or granted, and for which no penalty or punishment is provided elsewhere in this Act, the company and every officer of the company who is in default or such other person shall be liable to a penalty of ten thousand rupees, and in case of continuing contravention, with a further penalty of one thousand rupees for each day after the first during which the contravention continues, subject to a maximum of two lakh rupees in case of a company and fifty thousand rupees in case of an officer who is in default or any other person.

Non-filing of AGM proceedings with financials

6. Further Section 446B states that “if penalty is payable for non-compliance of any of the provisions of this Act
by a One Person Company, small company, start-up company or Producer Company, or by any of its officer in default, or any other person in respect of such company, then such company, its officer in default or any other person, as the case may be, shall be liable to a penalty which shall not be more than one-half of the penalty specified in such provisions subject to a maximum of two lakh rupees in case of a company and one lakh rupees in case of an officer who is in default or any other person, as the case may be”.

ORDER

7. Having considered the facts and circumstances of the case and after taking into account the provisions of Rule-11 of Companies (Adjudication of Penalties) Rules, 2014 (as amended), I hereby impose a penalty of Rs. 5,50,100 (Five Lakhs Fifty Thousand One Hundred only) on the company and Rs.188,500 (One Lakh Eighty-Eight Thousand Five Hundred only) each on the 5 (five) directors/officers in default of the company as per Table below under section 450 of the Act r/w. section 446B of the Companies Act, 2013 for failure in compliance of section 378ZA(10) of the Companies Act, 2013.

Nature of Default	Violation of Section of the Companies Act,2013	Company/ Officers to whom penalty imposed	No. of days in default *	Penalty for defaults (Rs.) as per Section 450 of the Act	Total Penalty (Rs.) [maximum of two lakh rupees in case of a company and fifty thousand rupees in case of an officer who is in default]	Penalty Imposed (Rs.) [As per section 446B: liable to a penalty shall not be more than one half of the penalty specified in such provisions]
2014 -2015	Section 378Z A(¹⁰)	On Company	2727	10000 + 100/ per day	10000 + 2727 * 100 =282,700/-	200,000/2= 100,000
		On Shri Amar Aravind Ghanekar	2727	10000 + 100/ per day	10000 + 2727 * 100 —282,700/-	50,000/2= 25,000
		On Shri Mayuresh Nitin Mirajkar	2727	10000 + 100/ per day	10000 + 2727 * 100 =282,700/-	50,000/2= 25,000
		On Shri Sagar Mukund Jadhav	2727	10000 + 100/ per day	10000 + 2727 * 100 =282,700/-	50,000/2= 25,000
		On Shri Nasir Jalauddin Shaikh	2727	10000 + 100/ per day	10000 + 2727 * 100 =282,700/-	50,000/2= 25,000
		On Shri Akshay Vilas Suryawanshi	2727	10000 + 100/ per day	10000 + 2727 * 100 =282,700/-	50,000/2= 25,000
2015 – 2016	Section 378Z A(10)	On Company	2361	10000 + 100/ per day	10000 + 2361 * 100 =246,100/-	200,000/2= 100,000
		On Shri Amar Aravind Ghanekar	2361	10000 + 100/ per day	10000 + 2361 * 100 =246,100/-	50,000/2 = 25,000
		On Shri Mayuresh Nitin Mirajkar	2361	10000 + 100/ per day	10000 + 2361 * 100 =246,100/-	50,000/2 = 25,000
		On Shri Sagar Mukund Jadhav	2361	10000 + 100/ per day	10000 + 2361 * 100 =246,100/-	50,000/2=25,000
		On Shri Nasir Jalauddin Shaikh	2361	10000 + 100/ per day	10000 + 2361 * 100 =246,100/-	50,000/2=25,000
		On Shri Akshay Vilas Suryawanshi	2361	10000 + 100/ per day	10000 + 2361 * 100 =246,100/-	50,000/2=25,000
2016 – 2017	Section 378Z A(10)	On Company	1996	10000 + 100/ per day	10000 + 1996 * 100 =209,600/-	200,000/2=100,000
		On Shri Amar Aravind Ghanekar	1996	10000 + 100/ per day	10000 + 1996 * 100 =209,600/-	50,000/2=25,000
		On Shri Mayuresh Nitin Mirajkar	1996	10000 + 100/ per day	10000 + 1996 * 100 =209,600/-	50,000/2=25,000
		On Shri Sagar Mukund Jadhav	1996	10000 + 100/ per day	10000 + 1996 * 100 =209,600/-	50,000/2=25,000
		On Shri Nasir Jalauddin Shaikh	1996	10000 + 100/ per day	10000 + 1996 * 100 =209,600/-	50,000/2=25,000
		On Shri Akshay Vitas Suryawanshi	1996	10000 + 100/ per day	10000 + 1996 * 100 =209,600/-	50,000/2=25,000
2017 – 2018	Section 378Z A(10)	On Company	1631	10000 + 100/ per day	10000 + 1631 * 100 =173,100/-	173100/2=86,550
		On Shri Amar Aravind Ghanekar	1631	10000 + 100/ per day	10000 + 1631 * 100 =173,100/-	50,000/2=25,000
		On Shri Mayuresh Nitin Mirajkar	1631	10000 + 100/ per day	10000 + 1631 * 100 =173,100/-	50,000/2=25,000
		On Shri Sagar Mukund Jadhav	1631	10000 + 100/ per day	10000 + 1631 * 100 =173,100/-	50,000/2=25,000
		On Shri Nasir Jalauddin Shaikh	1631	10000 + 100/ per day	10000 + 1631 * 100 =173,100/-	50,000/2=25,000
		On Shri Akshay Vilas Suryawanshi	1631	10000 + 100/ per day	10000 + 1631 * 100 =173,100/-	50,000/2=25,000
2018 – 2019	Section 378Z A(10)	On Company	1266	10000 + 100/ per day	10000 + 1266 * 100 =136,600/-	136,600/2=68,300
		On Shri Amar Aravind Ghanekar	1266	10000 + 100/ per day	10000 + 1266 * 100 =136,600/-	50,000/2=25,000
		On Shri Mayuresh Nitin Mirajkar	1266	10000 + 100/ per day	10000 + 1266 * 100 =^–136,600/-	50,000/2=25,000
		On Shri Sagar Mukund Jadhav	1266	10000 + 100/ per day	10000 + 1266900 =136,600/-	50,000/2=25,000
		On Shri Nasir Jalauddin Shaikh	1266	10000 + 100/ per day	10000 + 1266 * 100 =136,600/-	50,000/2=25,000
		On Shri Akshay Vilas Suryawanshi	1266	10000 + 100/ per day	10000 + 1266900 =136,600/-	50,000/2=25,000
2019-2020	Section 378ZA(10)	On Company	900	10000 + 100/ per day	10000 + 900 * 100 =100,000/-	100,000/2=50,000
		On Shri Amar Aravind Ghanekar	900	10000 + 100/ per day	10000 + 900 * 100 =100,000/-	50,000/2=25,000
		On Shri Mayuresh Nitin Mirajkar	900	10000 + 100/ per day	10000 + 900 * 100 =100,000/-	50,000/2=25,000
		On Shri Sagar Mukund Jadhav	900	10000 + 100/ per day	10000 + 900 * 100 =100,000/-	50,000/2=25,000
		On Shri Nash Jalauddin Shaikh	900	10000 + 100/ per day	10000 + 900 * 100 =100,000/-	50,000/2=25,000
		On Shri Akshay Vilas Suryawanshi	900	10000 + 100/ per day	10000 + 900900 =100,000/-	50,000/2=25,000
2020 -2021	Section 378Z A(10)	On Company	535	10000 + 100/ per day	10000 + 535 * 100 =63,500/-	63,500/2=31750
		On Shri Amar Aravind Ghanekar	535	10000 + 100/ per day	10000 + 535 * 100 =63,500/-	50,000/2=25,000
		On Shri Mayuresh Nitin Mirajkar	535	10000 + 100/ per day	10000 + 535 * 100 =63,500/-	50,000/2=25,000
		On Shri Sagar Mukund Jadhav	535	10000 + 100/ per day	10000 + 535 * 100 =63,500/-	50,000/2=25,000
		On Shri Nash Jalauddin Shaikh	535	10000 + 100/ per day	10000 + 535 * 100 =63,500/-	50,000/2=25,000
		On Shri Akshay Vilas Suryawanshi	535	10000 + 100/ per day	10000 + 535 * 100 =63,500/-	50,000/2=25,000
2021 – 2022	Section 378Z A(10)	On Company	170	10000 + 100/ per day	10000 + 170¹100 =27000/-	27,000/2=13,500
		On Shri Amar Aravind Ghanekar	170	10000 + 100/ per day	10000 + 170¹100 =27000/-	27,000/2=13,500
		On Shri Mayuresh Nitin Mirajkar	170	10000 + 100/ per day	10000 + 170 * 100 =27000/-	27,000/2=13,500
		On Shri Sagar Mukund Jadhav	170	10000 + 100/ per day	10000 + 170¹100 c-^–27000/-	27,000/2=13,500
		On Shri Nash Jalauddin Shaikh	170	10000 + 100/ per day	10000 + 170 * 100 =27000/-	27,000/2=13,500
		On Shri Akshay Vilas Suryawanshi	170	10000 + 100/ per day	10000 + 170 * 100 =27000/-	27,000/2=13,500

( * No of days have been calculated from 30.11 2015 till 18.05.2023 (date of order for FY 2014-2015 and so on

8. 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 www.mca.gov.in)under “Pay miscellaneous fees” category in MCA fee and payment Services within 90 (ninety) days of this order. The Challan/SRN generated after payment of penalty through online mode shall be forwarded to this office.

9. Appeal against this order may be filled in writing with the Regional Director (ER), Ministry of Corporate Affairs, Kolkata, within a period of 60 (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 this order (Section 454(5) & 454(6) of the Act, read with Companies (Adjudication of Penalties) Rules, 2014).

10. Your attention is also invited to section 454(8) of the Act in the event of non-compliance of this order.

(Aparajit Barua)

Adjudicating Officer &

Registrar of Companies-Cum-

Official Liquidator, Patna