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Introduction: This Ministry of Corporate Affairs (MCA) order details the penalty imposed on Pacelife Marketing Private Limited for not filing its financial statements for the financial years 2019-20, 2020-21, and 2021-22. The order outlines the relevant sections of the Companies Act, 2013, that were violated, the penalty imposed, and the process for appeal.

Detailed Analysis

  • Violations: The company violated Section 137(1) of the Companies Act, 2013, which mandates companies to file their financial statements with the Registrar within 30 days of the annual general meeting.
  • Penalty: The company and its directors, Mr. Arun Kumar and Mr. Harish Kumar Puwar, have been penalized for each financial year of non-filing. The penalty is based on a fixed amount plus a daily penalty, subject to a maximum limit. Considering the company’s status as small, the final penalty amount has been reduced by 50%.
  • Appeal Right: The company has the right to appeal the order within 60 days of receipt by filing Form ADJ with the Regional Director (Northern Region), MCA.

Conclusion: This order emphasizes the importance of companies adhering to financial filing requirements stipulated by the Companies Act. Failure to do so can result in penalties and other legal consequences. Companies should prioritize timely filing of financial statements to maintain good corporate governance practices.

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GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
OFFICE OF THE REGISTRAR OF
COMPANIES PUNJAB AND CHANDIGARH,
CORPORATE BHAWAN
PLOT NO.4-B, SECTOR 27B, CHANDIGARH
PHONE NO.172-2639415, 2639416

Order No. ROC CHD/ADJ/899 Dated: 28/02/2024

 

ORDER UNDER SECTION 454 FOR VIOLATION OF SECTION 137 OF THE COMPANIES ACT, 2013, READ WITH COMPANIES (ADJUDICATION OF PENALTIES) RULES, 2014

IN THE MATTER OF M/s PACELIFE MARKETING PRIVATE LIMITED

(CIN: U52609PB2017PTC046064)

1. The Ministry of Corporate Affairs vide its gazette notification no. S.O. 831(E) dated 24.3.2015, has appointed the undersigned as Adjudicating Officer (AO) 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 for adjudging penalties under the provisions of this Act.

Pacelife Marketing Penalized for Failing to File Financial Statements

2. Company:

Whereas the Company M/S PACELIFE MARKETING PRIVATE LIMITED (CIN: U52609PB2017PTC046064) was incorporated on 03/09/1992 having its registered office at Village Khojewal, Distt. Kapurthala, Punjab,144601, India.as per data available with MCA website.

Provisions of the Act:

3. Whereas as per Section 137(1) A copy of the financial statements, including consolidated financial statement, if any, along with all the documents which are required to be or attached to such financial statements under this Act, duly adopted at the annual general meeting of the company, shall be filed with the Registrar within thirty days of the date of annual general meeting in such manner, with such fees or additional fees as may be prescribed.

As per Section 137(3) If a company fails to file the copy of the financial statements under sub-section (1) or sub-section (2), as the case may be, before the expiry of the period specified therein, the company shall be liable to a penalty of ten thousand rupees and in case of continuing failure, with a further penalty of one hundred rupees for each day during which such failure continues, subject to a maximum of two lakh rupees, and the managing director and the Chief Financial Officer of the company, if any, and, in the absence of the managing director and the Chief Financial Officer, any other director who is charged by the Board with the responsibility of complying with the provisions of this section, and, in the absence of any such director, all the Directors of the company, 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 after the first during which such failure continues, subject to a maximum of fifty thousand rupees.

Facts about the case:

4. Whereas as per MCA Registry, the company has not filed its Balance Sheet for the financial year 2019-20 to 2021-22. This office has issued Show Cause Notice for violation of section 137(1) of the Companies Act, 2013 read with Companies (Adjudication of Penalties) Rules, 2014 to the company and its directors vide this office letter No. ROC CHD/2023-24/adj/137(3)/46064/550 to 553 dated 04.10.2023. But no reply has been received to such Show Cause Notices.

5. Therefore, it is concluded that the company and its officers in default are liable for penalty as prescribed under Section 137(3) of the Act for non-filing of Financial Statements of the company viz M/s PACELIFE MARKETING PRIVATE LIMITED for: –

  • Financial Year 2019-20 for 1123 days i.e., with effect from 31.01.2021 (last date of filing of financial statements was 30.01.2021) to 27.02.2024 (date of order).
  • Financial Year 2020-21 for 784 days i.e., with effect from 31.12.2021 (last date of filing of financial statements was 30.12.2021) to 27.02.2024 (date of order).
  • Financial Year 2021-22 for 485 days i.e., with effect from 31.10.2022 (last date of filing of financial statements was 30.10.2022) to 27.02.2024 (date of order).

Accordingly, I am inclined to impose a penalty as prescribed under Sub-Section (3) of Section 137 of the Companies Act, 2013. The details of the penalty imposed on the company and officers in default are as under:

Nature of Default
(1)
Violations under Companies Act, 2013
(2)
Name of person on whom penalty imposed
(3)
No. of days of default
(4)
Penalty for default (Rs)
(5)
Total Default amount (Rs)
(6)
Maxim urn Limit for penalty
(Rs)(7)
Penalty Based on Colum n (6) (Rs)
(8)
Final penalty Imposed 50% being small company u/s. 446B.(Rs)
(9)
Non- filing of financial statements F.Y. 2019-20 SEC. 137(1) On Company 1123 10000+ 100/Da y 10000+10 0*1123= 122300 200000 122300 61150
Mr. Arun Kumar 1123 10000+ 100/Da 10000+10 0*1123= 50000 122300 50000
Mr. Harish Kumar Puwar 1123 y10 000+ 100/Da y 122300 10000+10 0*1123= 122300 50000 122300 50000
Non- filing of financial statements F.Y. 2020-21 SEC. 137(1) On Company 784 10000+ 100/Da y 10000+10 0*784 = 88400 200000 88400 44200
Mr. Arun Kumar 784 10000+ 100/Da y 10000+10 0*784=88 400 50000 88400 44200
Mr. Harish Kumar Puwar 784 10000+ 100/Da y 10000+10

0*784=88

400

50000 88400 44200
Non- filing of financial statements F.Y. 2020- 21 SEC. 137(1) On Company 485 10000+ 100/Da y 10000+10 0*485=58 500 200000 58500 29250
Mr. Arun Kumar 485 10000+ 100/Da y 10000+10 0*485=58 500 50000 58500 29250
Mr. Harish Kumar Puwar 485 10000+ 100/Da y 10000+10 0*485=58 500 50000 58500 29250

I am of this opinion that penalty is commensurate with the aforesaid failure committed by the Noticees and penalty so imposed upon the Officers-in-default shall be paid from their personal sources/income.

It is further directed that penalty imposed shall be paid through the Ministry of Corporate Affairs portal only as mentioned under Rule 3(14) of Companies (Adjudication of Penalties) (Amendment) Rules, 2019 under intimation to this office.

6. Appeal against this order may be filed in writing with the Regional Director (Northern Region), Ministry of Corporate Affairs, CGO Complex, Lodhi 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].

7. Your attention is also invited to Section 454(8)(i) and 454(8)(ii) of the Companies Act, 2013, which state that in case of non-payment of penalty amount, 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 and officer in default 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.

8. In terms of the provisions of sub-rule (9) of Rule 3 of the Companies (Adjudication of Penalties) Rules, 2014, copy of the order is being sent to: – (1.) M/s Pace life Marketing Private Limited, Village Khojewal, Distt. Kapurthala, Punjab,144601, India, (2.) Mr. Arun Kumar (3.) Mr. Jaspal Singh (4.) Mr. Harish Kumar Puwar and (5.) Regional Director (Northern Region), Ministry of Corporate Affairs, CGO Complex, Lodhi Road, New Delhi and will also be uploaded on website.

(Kamna Sharma)
Registrar of Companies & Adjudicating Officer
Punjab and Cha

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