Occupation of allottees not mentioned in form PAS-3: MCA imposes Penalty

The Registrar of Companies, Tamil Nadu, issued an adjudication order against M/s. Appattuvilai St. Antony’s Nidhi Limited for non-compliance with Rule 12(2) of the Companies (Prospectus and Allotment of Securities) Rules, 2014. The company failed to include the occupation of allottees in Form PAS-3, leading to a violation. Despite requests for leniency by the company’s Managing Director, Mr. Paramjothi Jesudasan, the omission was not excused. The Adjudicating Officer imposed a penalty of ₹10,000 on both the company and the Managing Director, totaling ₹20,000. The penalty must be paid online within 90 days, with non-compliance potentially leading to further fines or imprisonment. The company has the right to appeal the order within 60 days to the Regional Director, Ministry of Corporate Affairs. Failure to comply with this order could result in significant fines or imprisonment for the officers involved.

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/ADJ/APPATTUVILAI /RULE 12/2024 DATE: 01 AUG 2024

ADJUDICATION ORDER UNDER RULE 12(2) OF THE COMPANIES (PROSPECTUS AND ALLOTMENT OF SECURITIES), RULES 2014

IN THE MATTER OF M/S. APPATTUVILAI ST.ANTONY’S NIDHI LIMITED

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. Appattuvilai St. Antony’s Nidhi Limited with CIN: U65929TN2017PLC119174(herein after referred as ‘ company’ or ‘ subject company’) is a registered company with this office under the Companies Act, 2013 having its registered office as per MCA21 Registry at 529/21, Appattuvilai, Thuckalay, Kanyakumari, Tamil Nadu 629175. The financial & other details of the subject company as available on MCA-21 portal is stated as under:

3. Directors During the period of violation:

4. Section/Rule and Penal Provision as per Companies Act, 2013

Rule 12 of the Companies (Prospectus and Allotment of Securities) Rules, 2014: Return of Allotment.

(1) Whenever a company having a share capital makes any allotment of its securities, the company shall, within thirty days thereafter, file with the Registrar a return of allotment in Form PAS-3, along with the fee as specified in the Companies (Registration Offices and Fees) Rules, 2014.

(2) There shall be attached to the Form PAS-3 a list of allottees stating their names, address, occupation, if any, and number of securities allotted to each of the allottees and the list shall be certified by the signatory of the Form PAS-3 as being complete and correct as per the records of the company.

Section 450. Punishment where no specific penalty or punishment is provided-

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.

5. Issue of Adjudication Notice:

The Ministry vide order dated 06.07.2023 rejected the form NDH-4 (Form for filing application for declaration as Nidhi and for updation of Status by Nidhi) filed by the company M/s. Appattuvilai St. Antony’s Nidhi Limited (vide SRN: R57403131 Dt 21.09.2020) wherein it was mentioned that “the company has not mentioned the occupation of allottees in the list of allottees attached with Form PAS-3 filed in MCA system, resulting in violation of Rule 12(2) of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

After that the ROC Chennai had issued Adjudication Notice No. ROC/CHN/Adj. Appattuvilai/2023 dt 31.08.2023 to the company.

6. Reply of Company and Directors for Adjudication Notice issued:

The Managing Director of the company vide letter dated 19.12.2023 submitted that “the occupation is not mandatory for those who did not have an occupation through which they are earning an income. The omission of the Occupation of the allottees in the list of allottees is not intentional. Hence, request to take lenient view and drop further proceedings.

7. Adjudication Hearing:

The Adjudicating Authority had issued notice of hearing dt 13.03.2024 by fixing the hearing on 18.03.2024. Mr. Paramjothi Jesudasan, Director of the company vide letter dated 19.03.2024 requested to adjourn the hearing to a new date. After that final notice of hearing dt 02.05.2024 has issued to the company and its directors by fixing the hearing on 08.05.2024. Pursuant to the Adjudication notice dt 02.05.2024, Mr. A. John Moris, Chartered Accountant, Partner of M/s. A.John Moris & Co., Chartered Accountants appeared before Adjudicating Authority submitted that omission of the occupations of the allottees in the list of allottees is not intentional as they did not have an occupation through which they were earning an income. Hence, take a lenient view and drop further proceedings.

8. Analysis of Non- compliance of the Companies Act, 2013:

A list of allottees is attached along with form PAS -3 filed (vide SRN: 816606055 dt 26.11.2019) by the company, but the occupation of allottees were not mentioned in the list as required under Rule 12(2) of the Companies (Prospectus and Allotment of Securities), Rules, 2014. Hence, the company was violated Rule 12(2) of the Companies (Prospectus and Allotment of Securities), Rules, 2014 and the company and its Officers in default are liable for penalty U/s. 450 of the Companies Act, 2013.

The company being a Nidhi company 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.

9. Decision

Having considered the facts and circumstances of the case and after taking into account it is concluded that the Company and directors have violated Rule 12(2) of (Companies Prospectus and Allotment of Securities), Rules, 2014. Accordingly, I am inclined to impose a penalty as prescribed under Section 450 of the Companies Act, 2013. The details of the penalty imposed on the Company and Officers in default are shown in the table given below:

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 a penalty of Rs.10,000/- (Rupees Ten thousand) is imposed on the Company and Rs.10,000/- (Rupees ten Thousand) is imposed on the Officer in default as mentioned above. Totally Rs.20,000/- (Rupees Twenty Thousand) as penalty amount for violation of Rule 12(2) of the Companies (Prospectus and Allotment of Securities), Rules, 2014.

9. 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.

10. 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].

11. Your attention is also invited to section 454(8) of the Act in the event of non-compliance of this order, “(8)(i) Where company fails to comply with the order made under sub­section (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 five lakh rupees.

12. 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

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6. eForm PAS-3 | Return of allotment

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8. Form PAS-3 – Private Placement of Securities