Non-Filing of Annual Return under Section 92(4): MCA Imposes Penalty

In a recent adjudication by the Ministry of Corporate Affairs, East Alpha Alliance Technology Private Limited faces penalties for violating Section 92 of the Companies Act, 2013. East Alpha Alliance Technology Pvt Ltd, registered under the Companies Act in 2017, failed to file its annual returns for the fiscal years ending March 2020 and March 2021. This non-compliance triggered an inquiry initiated by the Registrar of Companies, Kanpur, following directions from the Ministry of Corporate Affairs. Despite the issuance of a Show Cause Notice, neither the company nor its directors responded or appeared for a hearing.

The penal action was justified under Section 92(5) of the Companies Act, 2013, which mandates penalties for non-filing of annual returns. The penalty structure includes initial penalties and additional daily penalties for continuing defaults, with a maximum cap set by law. The total penalties imposed on East Alpha Alliance Technology Pvt Ltd and its directors reflect the severity of their non-compliance, totaling significant amounts.

Concluding the adjudication, the Registrar of Companies, Uttar Pradesh, Kanpur, imposed the prescribed penalties as per the legal provisions outlined in the Companies Act. The company and its officers in default have been instructed to pay the penalties through the MCA21 portal within 90 days from the date of the order.

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

No.07/01/Adjudication-92/ EAST ALPHA/886 to 890 Dated. 08/05/2024.

ORDER FOR VIOLATION OF SECTION 92 OF THE COMPANIES ACT, 2013 READ WITH COMPANIES (ADJUDICATION OF PENALTIES) RULES, 2014 & Companies (Amendment Act 2020)

IN THE MATTER OF “EAST ALPHA ALLIANCE TECHNOLOGY PRIVATE LIMITED”

1. The Ministry of Corporate Affairs vide its gazette notification no A-42011/112/2014-Ad.II 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 & Companies (Amendment Act 2020) for adjudging penalties under the provisions of this Act.

2. Whereas the Company “East Alpha Alliance Technology Private Limited “has been registered under the provisions of Companies Act on 18.05.2017 and is having its registered office situated at F-304, Ground Floor, Sector-63, Noida, Gautam Buddha Nagar, Uttar Pradesh,201301. The authorized capital of the company is Rs. 30,00,000/-

3. Whereas Ministry vide letter No. F. No. 3/211/2020-CL-II(NR) dated 28.10.2020 gave instructions to conduct the Inquiry to Registrar of Companies, NCT of Delhi & Haryana but the same has been transferred to ROC, Kanpur vide letter No. ROC/Secret Reference/Inquiry/4852 dated 05.08.2022 as per direction of the Ministry. The Inquiry Officer (JO) has observed that the Company has not filed annual returns in form MGT-7 for the year ended 31.03.2020 and 31.03.2021. Accordingly, the Inquiry officer has reported the said violation in the Inquiry Report dated 11.11.2022. The Regional Director vide letter Inq/206(4)/East Alpha/RD(NR)/2022/890 dated 04.05.2023 has accorded the penal action for said non-compliance. Thus, it is evident that the company and its Directors have failed to comply with the provisions of section 92 of the Companies Act, 2013, in filing of the annual return of the company for year ending 31.03.2020 and 31.03.2021 thereby attracting the penal provisions mentioned under Section 92(5) of the Act. The Company and its Directors are officers in default, as per section 2(60), of the Companies Act, 2013. And are thus liable for penal provisions.

4. Accordingly, a Show Cause Notice No.. 07/01/Adjudication-92/ EAST ALPHA /7749 to 7753 dated 15.03.2024 was issued to the company and its officers in default under section under Section 92 of the Companies Act, 2013, read with Companies (Adjudication of Penalties) Rules, 2014 by this office. This office has not received the said letter undelivered also.

5. 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. 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 92 of the Companies Act, 2013, in filing of a copy of the annual return, within sixty days from the date on which the annual general meeting is held upto 30.09.2020 and 30.09.2021 thereby attracting the penal provisions mentioned under Section 92(5) of the Act.

6. The date of default in the matter has been taken as 29.11.2020 and 29.11.2021 i.e. the date upto a copy of the annual return, within sixty days from the date on which the annual general meeting is held or where no annual general meeting is held in any year within sixty days from the date on which the annual general meeting should have been held together with the statement specifying the reasons for not holding the annual general meeting, with such fees or additional fees as may be prescribed. The default has been continuing since then.

7. Section 92(4) of the Companies Act, 2013 provides that:-

“Every company shall file with the Registrar a copy of the annual return, within sixty days from the date on which the annual general meeting is held or where no annual general meeting is held in any year within sixty days from the date on which the annual general meeting should have been held together with the statement specifying the reasons for not holding the annual general meeting, with such fees or additional fees as may be prescribed.”

Section 92(5) of the Companies Act, 2013 provides that —

“If a company fails to file its annual return under sub-section (4), before the expiry of the period specified therein, the company and its every officer who is in default shall be liable to a penalty of ten thousand rupees and in case of continuing failure, with further penalty of one hundred rupees for each day during which such failure 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.”

8. As per provisions of section 446B of the Companies Act, 2013 provides that “Notwithstanding anything contained in this act, 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 persons, as the case maybe 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 one lakh rupees in case of an officer who is in default or any other person, as the case may be”.

9. Order:

Having considered the facts and circumstances of the case and after taking into account the factors above, I hereby impose penalty as prescribed under section 92(5) of the Act. The default of the penalty imposed on the company (Being Small Company as per section 2(85) of the Act) and officers in default are shown in the table below:

I am of this opinion that penalty is commensurate with the aforesaid failure committed by the notice(s).

10. The Noticee shall pay the amount of penalty so imposed through MCA21 portal only as per rule 3(14) of Companies (Adjudication of Penalties) 2014. within 90 days receipt of this order. The company needs to file InC-28 as per the provisions of the act, attaching the copy of adjudication order alongwith payment challans.

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 non­ compliance of this order. In Case appeal is made 0/o Registrar of Companies, U.P. maybe in,, former alongwith the penalty imposed & the payments made.

(Seema Rath)
Registrar of Companies & Adjudicating Officer
Uttar Pradesh, Kanpur

NO. 07/01/ADJ-92/ EAST ALPHA/886 to 890

DATED 08/05/2024