The company and its directors were penalized for failing to file Form CHG-1 to register or modify secured vehicle loans under Section 77 of the Companies Act, 2013, despite claiming registration under the Motor Vehicles Act. The adjudicating officer held that non-compliance attracts penalties under Section 86 and Section 454, imposing ₹5 lakh on the company and ₹50,000 on each director. The ruling underscores personal liability of officers, emphasizes that intent or practical difficulties do not exempt them from statutory obligations, and serves as a cautionary reminder for timely corporate filings.
This order, issued by the Registrar of Companies (ROC) Cuttack on October 17, 2025, serves as an adjudication of penalty against Magnum Estates Limited and its directors for a violation of Section 77 of the Companies Act, 2013, concerning the registration of charges. The ROC Cuttack, acting as the Adjudicating Officer, observed from the company’s financial statements for the year ending March 31, 2019, that a secured loan under the head “Vehicle loans from other Banks” increased significantly from $2,74,038$ as of March 31, 2018, to $6,01,564$. This change constituted the creation or modification of a charge, requiring the company to file Form CHG-1 with the ROC office, as mandated by Section 77 of the Act read with Rule 3 of the Companies (Registration of Charges) Rules, 2014. The company failed to file this requisite form.
In response to a Show Cause Notice, the company stated that while it intended to file the form, it was unable to complete the process because the form requires digital signatures from the company director, an authorized representative of the charge-holder bank, and a practicing professional. The company claimed the bankers declined to cooperate, asserting that vehicle hypothecation was already registered under the Motor Vehicles Act and an additional filing under the Companies Act was unnecessary. The Adjudicating Officer deemed this explanation unsatisfactory, stating the company’s obligation under the Companies Act remains. Consequently, a penalty was imposed under the provisions of Section 86 of the Act. The penalty was levied upon the company, Magnum Estates Limited, and three directors identified as officers in default: Shri Ramesh Mahapatra, Ms. Geetarani Padhi, and Shri Bibhuti Bhusan Mishra.
The total penalty imposed is $5,00,000$ on the company and $50,000$ on each of the three directors, resulting in a total penalty of $6,50,000$. The company and the directors are required to pay the imposed penalties within 90 days of receiving the order through the ‘e-Adjudication’ facility on the Ministry of Corporate Affairs website. The order specifically directs that the penalties imposed on the officers in default must be paid from their personal sources or income. The defaulting parties are also advised to rectify the default. An appeal against this order can be filed in writing with the Regional Director, RD Kolkata, within 60 days of receipt.
GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
ROC Cuttack
ROC-cum-Official Liquidator, Ministry Of Corporate Affairs, Corporate Bhawan, 2nd & 3rd Floor, Plot No-9(P), Sector-1,CDA,
Cuttack, Odisha, India, 753014
Phone: 0671-2366952
E-mail: roc.cuttack@mca.gov.in
Order ID: PO/ADJ/10-2025/CT/00795 Dated: 17/10/2025
ORDER FOR ADJUDICATION OF PENALTY UNDER SECTION 454 OF THE COMPANIES ACT, 2013 (‘THE ACT’) FOR VIOLATION OF SECTION 86 OF THE COMPANIES ACT, 2013.
A. Appointment of Adjudicating Officer:
Ministry of Corporate Affairs vide its Gazette notification number S.O. 831(E) dated 24/03/2015 appointed 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 MAGNUM ESTATES LIMITED [herein after known as Company] bearing CIN U74102OR1993PLC003346, is a company registered with this office under the Provisions of the Companies Act, 2013/1956 having its registered office situated at 132A,SECTIOR-A,ZONE AMENCHESWAR INDUSTRIAL EASTATE NA BHUBANESWAR ORISSA INDIA 751010
Individual details:
In the matter relating to RAMESH MAHAPATRA [herein after known as individual] having DIN 00628087 and having its address at
In the matter relating to GEETARANI PADHI [herein after known as individual] having DIN 00628185 and having its address at
In the matter relating to BIBHUTI BHUSAN MISHRA [herein after known as individual] having DIN 00634715 and having its address at
C. Provisions of the Act:
If any company is in default in complying with any of the provisions of this Chapter, the company shall be liable to a penalty of five lakh rupees and every officer of the company who is in default shall be liable to a penalty of fifty thousand rupees
D. Facts about the case:
1. Default committed by the officers in default/noticee – It is observed from the Financial Statements for the year ending 31.03.2019 that as on 31.03.2018, Secured Loan under the Head ?Vehicle loans from other Banks? was Rs.2,74,038 and the same has been increased to Rs.6,01,564 during the Financial Year 2018-19. But, it is seen that the company has not filed CHG-1 for creation/modification of Charge with this office in this respect as required under Section 77 of the Companies Act, 2013 read with Rule 3 of the Companies (Registration of Charges) Rules, 2014.
2. A.
E.Order:
1. Facts about the case : It is observed from the Financial Statements for the year ending 31.03.2019 that as on 31.03.2018, Secured Loan under the Head Vehicle loans from other Banks was Rs.2,74,038 and the same has been increased to Rs.6,01,564 during the Financial Year 2018-19. But, it is seen that the company has not filed CHG-1 for creation/modification of Charge with this office in this respect as required under Section 77 of the Companies Act, 2013 read with Rule 3 of the Companies (Registration of Charges) Rules, 2014.
Reply of the Company/Directors : In response to the SCN dated 28.08.2025, the company in its reply dated 27.09.2025 has stated that :-
The filing of Form CHG-1 requires digital signatures of (i) company director, (ii) authorised representative of the charge-holder bank, and (iii) a practicing professional.
When approached, the bankers declined to cooperate, stating that vehicle hypothecation already stands registered under the Motor Vehicles Act and additional filing under Companies Act was not necessary.
Consequently, the Company was unable to complete the CHG-1 filing despite its intent.
Order : The submission of the company is not satisfactory. Hence, the A.O. do hereby impose penalty upon the company and its Directors/Officers in default for the relevant period namely:- Magnum Estates Limited (company), Shri Ramesh Mahapatra, Ms. Geetarani Padhi, Shri Bibhuti Bhusan Mishra (all are directors of the company) under the provisions of Section 86 of the Companies Act, 2013 for violation of Section 77 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:
| (A) | Name of person on whom penalty imposed (B) | Rectification of Default required (C) | Penalty Amount (D) | Additional Penalty (E) (*Per day of continuing default i.e. date of rectification of default less order issue date) | Maximum limit for Penalty (F) |
| 1 | MAGNUM ESTATES LIMITED having CIN as U74102OR1993P LC003346 | 500000 | 0 | 500000 | |
| 2 | RAMESH MAHAPATRA having DIN as 00628087 | 50000 | 0 | 50000 | |
| 3 | GEETARANI PADHI having DIN as 00628185 | 50000 | 0 | 50000 | |
| 4 | BIBHUTI BHUSAN MISHRA having DIN as 00634715 | 50000 | 0 | 50000 |
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 Kolkata 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.
Sudhir Kapoor,
Registrar of Companies
ROC Cuttack
