Possession of Multiple DIN: MCA imposes penalty of Rs. 19.51 Lakh

Ministry of Corporate Affairs has issued an adjudication order under Section 155 of the Companies Act, 2013, regarding Mrs. Anubama, who was found in violation of rules related to Director Identification Numbers (DINs). The case stems from her obtaining a second DIN (06564762) on April 23, 2013, while already holding a valid DIN (01918570) since January 9, 2008. The Companies Act prohibits individuals from possessing multiple DINs, and violations attract penalties under Section 159. Mrs. Anubama acknowledged the error, citing inadvertence and no malafide intent. Despite surrendering the second DIN via Form DIR-5 in July 2024, the application was flagged, necessitating adjudication.

A hearing was conducted, and the Registrar of Companies, Chennai, acting as the Adjudicating Officer, reviewed the case. The analysis revealed a violation spanning from April 1, 2014, to August 27, 2024—a total of 3,802 days. Based on Section 159 of the Act, Mrs. Anubama was held liable for a penalty of ₹19,51,000. She has been instructed to pay the penalty within 90 days via the Ministry of Corporate Affairs portal. The order also provides an option for appeal to the Regional Director within 60 days. Non-compliance may result in additional fines or imprisonment as stipulated under Section 454(8) of the Act.

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/ANUBAMA/ADYS.155/2024

DATE : 3 OCT 2024

ADJUDICATION ORDER UNDER SECTION 155 OF THE COMPANIES ACT, 2013

IN THE MATTER OF MRS.ANUBAMA (DIN:01918570)

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, Mrs. Anubama hereinafter referred as the Director having Director Identification Number (DIN)- 01918570 and having Permanent address at Flat No. D, Kceesagarika Apartment, Old No.2, New No.3, Dr.Gurusamy Road, Chetpet, Chennai-600031.

3. Section and Penal Provision as per Companies Act, 2013

Section 155 of the Companies Act, 2013 * Allotment of Director Identification Number. No individual, who has already been allotted a Director Identification Number under section 154, shall apply for, obtain or possess another Director Identification Number.

*Notified Date of Section: 01.04.2014

Section 159 – Penalty for Default of Certain Provisions.

If any individual or director of a company makes any default in complying with any of the provisions of section 152 section 155 and section 156, such individual or director of the company shall be liable to a penalty which may extend to fifty thousand rupees and where the default is a continuing one, with a further penalty which may extend to five hundred rupees for each day after the first during which such default continues.

4. Facts of the case

Mrs. Anubama has submitted an Adjudication application in GNL-1 vide SRN: F97820997 dt 28.08.2024 for violation of Section 155 of the Companies Act,2013 and also submitted a physical application. The applicant submitted that she has obtained her first DIN ­01918570 on 09.01.2008. After that She was appointed as a director in multiple Companies using this first DIN but later resigned from all the companies as director and hence not a director in any of the companies as of now. The applicant has further obtained inadvertently the second DIN-060564762 on 23.04.2013, The applicant was also appointed as Director in some of the companies using this second DIN and later resigned from all such positions. Further, the applicant was appointed as designated partner in two LLPs and continuing till date. The applicant has applied in form No DIR-5 to surrender the second DIN -06564762 through vide SRN: AA8293879 dated 16.07.2024. However, the form was returned for resubmission with remarks stating that ” the DIN holder has taken second DIN in violation of Section 155 of the Companies Act, 2013 and required to be get adjudicated the violation under the provisions of the Companies Act,2013.”Hence, submitted the adjudication application as the aforesaid contravention was not committed with any malafide intent and no prejudice is caused to any stake holders.

5. Adjudication Hearing:

On basis of the Adjudication Application, this Adjudicating Authority had issued Adjudication Hearing Notice to the Company and its Officers in default on 04.09.2024 fixing the hearing date as 10.09.2024 at 12.20 P.M. Pursuant to hearing notice issued on 04.09.2024. Mr. A. Kumar Reddy – CS , authorized representative for applicant appeared before the Adjudicating Authority and made submissions that, “the said violation may be adjudicated as per section 159 of the Companies Act, 2013.”

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

It is noticed that the applicant, Mrs. Anubama obtained her first DIN -01918570 on 09.01.2008 and she was appointed as a director in multiple Companies using this first DIN Further, on 23.04.2013, the applicant has further inadvertently obtained a second DIN ­06564762, The applicant was also appointed as Director in some of the companies using this second DIN, although the applicant continues to serve as a designated partner in two LLPs.

As per the records Mrs. Anubama was holding directorship in the following companies from the activation of her DINs.

(I) DIN — 01918570:

(II) DIN —06564762

(I) List of Associated LLPs

The applicant was holding 2 DINs from 23.04.2013 onwards. Further, Mrs. Anubama has filed e-form DIR-5 on 16.07.2024 to surrender the DIN which was obtained on 23.04.2013. The form was returned with remarks to adjudicate the violation. After that filed the Adjudication application in e-form GNL-1 vide SRN: F97820997 dt 28.08.2024.Hence, there a violation of Section 155 of the Companies Act, 2013 till 27.08.2024. The applicant is liable for penalty under Section 159 of CA 2013.

Further, the application in GNL-1 was received prior to 16th day of September 2024, effective date of the Companies (Adjudication of Penalties) Amendment Rules, 2014.

7. Decision

Having considered the facts and circumstances of the case and after taking into account the factors above, it is concluded that Mrs. Anubama has violated Section 155 of the Companies Act, 2013.

Accordingly, I am inclined to impose a penalty as prescribed under Section 159 of the Companies Act, 2013. The details of the penalty imposed on the director as shown in the below table:

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.19,51,000/- (Rupees Nineteen lakhs fifty one thousand) is imposed on Mrs. Anubama as penalty amount for violation of Section 155 of the Companies Act, 2013.

8. 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.

9. 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].

10. 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.

(ii) 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