The company and directors were penalized under Sections 42(8), 450 & 454 of the Companies Act for incomplete securities allotment records, highlighting personal liability and the need for timely statutory filings.
This order, issued by the Registrar of Companies (ROC) Bangalore, addresses a contravention of the Companies Act, 2013, by Shashwatha Nidhi Limited and one of its officers. The ROC, acting as the Adjudicating Officer under Section 454 of the Act, found the company in violation of Section 450 for a failure to comply with certain requirements under Section 42(8) read with Rule 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014. The case originated from a suo-motu application filed by the company on November 28, 2024, acknowledging the non-compliance. Specifically, the company failed to provide complete details in the list of allottees submitted with Form PAS-3, a filing from December 18, 2017. The missing information included the PAN and email ID of its members and particulars of consideration received if securities were issued for non-cash consideration. The company and one director, Padmaprasada, requested and were granted a hearing, where their authorized representative submitted that the violation was unintentional and due to a lack of professional support, arguing that no party had been impacted.
The Adjudicating Officer proceeded with the order after considering the company’s application, subsequent replies, and submissions made during the hearing. A review of the records determined that the company does not meet the definition of a “small company” under Section 2(85) of the Act, which means the provision for imposing a lesser penalty under Section 446B is not applicable. Consequently, a penalty was levied on both the company and the director. Shashwatha Nidhi Limited was subject to a penalty of ₹1,00,000, with a maximum penalty limit of ₹2,00,000 for any continuing default. The officer in default, Padmaprasada, was also penalized ₹1,00,000, with a maximum limit of ₹50,000 for any continuing default. The order directs the company and the officer to rectify the default and pay the imposed penalty within 90 days of receiving the order, with the officer’s penalty to be paid from personal income. Non-payment within the timeline will invite further penal consequences as outlined in Section 454(8). The order notes that a separate order would be issued for other directors who were also officers in default on the date of the contravention.
GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
ROC Bangalore
Registrar Of Companies, ‘E’ Wing, 2nd Floor, Kendriya Sadana, Kormangala, Bangalore, Karnataka, India, 560034
Phone: 080-25633105,080-25537449
E-mail: roc.bangalore@mca.gov.in
Order ID: PO/ADJ/10-2025/BL/00788 Dated: 16/10/2025
ORDER FOR ADJUDICATION OF PENALTY UNDER SECTION 454 OF THE COMPANIES ACT, 2013 (‘THE ACT’) FOR VIOLATION OF SECTION 450 OF THE COMPANIES ACT, 2013.
A. Appointment of Adjudicating Officer:
Ministry of Corporate Affairs vide its Gazette notification number S.O. 831(E) dated 24/03/2015appointed 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 SHASHWATHA NIDHI LIMITED [herein after known as Company] bearing CIN U65999KA2017PLC102542, is a company registered with this office under the Provisions of the Companies Act, 2013/1956 having its registered office situated at NO. 30/31, 3RD FLOOR, BK CIRCLE, KOTHNUR DINNE MAIN ROAD, J P NAGAR 8TH P NO. 30/31, 3RD FLOOR, BK CIRCLE, KOTHNUR DINNE MAIN ROAD, J P NAGAR 8TH P NA BANGALORE BANGALORE KARNATAKA INDIA 560076
Individual details:
In the matter relating to PADMAPRASADA . [herein after known as individual] having DIN 03099253 and having its address at
C. Provisions of the Act:
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 1[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]
D. Facts about the case:
1. Default committed by the officers in default/noticee – The company has filed a suo-motu application on 28.11.2024 regarding non- compliance of section 42(8) of the Act r/w 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014 wherein it was submitted that the company has filed the NDH-4 and it got rejected with comment that the company has not maintained the complete details in the list of allotees furnished with Form PAS-3 filed in MCA system vide SRN G70432992 dated 18.12.2017. However, the company has failed to update the PAN and email Id of its members and particulars of consideration received, if the securities were issued for consideration other than cash.
2. The company and officers in default asked for a hearing and same was provided. The order is issued based on the application, notice for adjudication, replies received and submission made at the time of hearing.
E. Order:
1. The company has filed a suo-motu application on 28.11.2024 regarding non- compliance of section 42(8) of the Act r/w 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014 wherein it was submitted that the company had filed form NDH-4 which was rejected with comments that the company has not mentioned the complete details in the list of allotees furnished with Form PAS-3 filed in MCA portal vide SRN G70432281 dated 18.12.2017 and G70432992 dated 18.12.2017. The company had failed to provide the details viz. PAN and email Id of its members and particulars of consideration received if the securities were issued for consideration other than cash. Thus, the company and officers in default have violated the provisions of section 42(8) r/w 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014.
Pursuant to the adjudication application filed by the company, show cause notice dated 19.02.2025 was sent to the company and its officers in default through e-Adjudication module, and was also sent through speed post on 20.02.2025. The company and Officers in default have submitted their reply dated 07.03.2025 on e-Adjudication portal stating that the violation has been unintentional and had occurred due to lack of professional support, and no one has been impacted due to this violation committed. Subsequently, e-hearing notice dated 23.06.2025 was sent to the company and its officers in default through e-Adjudication module. E- Hearing was scheduled on 24.06.2025 which was attended by Mr. Ishmavel Jacob, practising company secretory and authorized representative of company and officers in default who reiterated the submissions as per the adjudication application filed and reply submitted.
This first adjudication application was filed by the company and Sri Padmaprasada, Managing Director of the company only. During the hearing, it was noticed that this being a one-time default, Sri Padmaprasada was the MD only from 11.08.2018 and was a director on the date of default i.e. 18.12.2017. Hence, further notice was issued to the other directors who were the officers in default in the absence of any key managerial personnel during the duration of default. Since, the company and Sri Padmaprasada were covered in the first adjudication hearing dated 24.06.2025, the later issued notice was sent to other directors of the company as on the day of default. Further, no request for a hearing in the matter has been sought by the other directors on the portal to the subsequent notice.
Since the default was already crystallized during the hearing of the first adjudication notice and no contrary reply or hearing request was made by the other directors on the subsequent notice, the undersigned proceeds to issue Orders in the matter on the company and the directors who were the officers in default. One order would deal with the company and Sri Padmaprasada, and the other order would deal with the remaining directors.
It is seen from records that the company does not fall under the definition of small company as per the provisions of section 2(85) of the Companies Act, 2013. Therefore, the provision of imposing lesser penalty as per the section 446B of the Act shall not be applicable in the case.
This violation is being adjudicated for the SRN G70432281 dated 18.12.2017 and G70432992 dated 18.12.2017. However, in the e-Adjudication Module, this Order pertains to the SRN G70432992, and other SRN is dealt with in separate Orders.
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 | SHASHWATHA NIDHI LIMITED having CIN as U65999KA2017P LC102542 | 10000 | 0 | 200000 | |
| 2 | PADMAPRASAD A having DIN as 03099253 | 10000 | 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 Hyderabad 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.
Simhachalam Naidu,
Registrar of Companies
ROC Bangalore
