The Ministry of Corporate Affairs (MCA), through the Office of Registrar of Companies, Tamil Nadu, Andaman & Nicobar Islands, Chennai, has issued an adjudication order under Section 134(5).(c) of the Companies Act, 2013, concerning M/s Anmol Ferro Impex Private Limited.
1. Background: M/s Anmol Ferro Impex Private Limited, a registered company, has been found in violation of Section 134(5)(c) of the Companies Act, 2013. The company, headquartered in Chennai, failed to disclose related party transactions concerning Directors’ current payables as per Accounting Standard-18.
2. Inquiry and Adjudication: An inquiry conducted under Section 206(4) revealed the company’s non-compliance. Subsequently, an adjudication notice was issued to the company and its officers, prompting them to respond. However, no reply was received. Despite a final hearing notice, only one director, Mr. Sanjay Kumar Sharma, appeared and expressed willingness to accept penalties as per the law.
3. Decision and Penalties: After careful consideration, it was concluded that both the company and its Managing Director are liable for penalties as prescribed under Section 134(8) of the Companies Act, 2013. The penalties imposed are as follows:
- For the financial years 2015-16, 2016-17, and 2017-18, M/s Anmol Ferro Impex Private Limited faces a penalty of ₹3,00,000 each year, totaling ₹9,00,000.
- Mr. Sanjay Kumar Sharma, the Managing Director, is penalized ₹50,000 for each of the mentioned financial years, totaling ₹1,50,000.
Thus, a cumulative penalty of ₹10,50,000 is imposed on the company and its Managing Director.
4. Compliance and Appeals: The company and the Managing Director are directed to pay the penalties through the specified online platform within 90 days of receiving the order. Additionally, they have the option to appeal this decision within sixty days to the Regional Director (SR), Ministry of Corporate Affairs.
5. Consequences of Non-Compliance: Failure to comply with this order within the stipulated time may result in further penalties. Section 454(8) of the Companies Act, 2013 outlines fines and potential imprisonment for non-compliance.
In conclusion, M/s Anmol Ferro Impex Private Limited faces significant penalties for its failure to disclose related party transactions, highlighting the importance of compliance with regulatory standards in corporate governance.
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/ANMOL FERRO/ADJ/S.134/2024 DATE: 25 MAR 2024
ADJUDICATION ORDER UNDER SECTION 134(5).(C) OF THE COMPANIES ACT, 2013
IN THE MATTER OF M/S ANMOL FERRO IMPEX PRIVATE 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. Anmol Ferro Impex Private Limited with CIN :U5110TN2009PTC073831 (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 Barracks Arcade. First Floor, Office No.10, Door No.61/1, Perambur Barracks Road, Chennai, Tamil Nadu 600007. The financial & other details of the subject company as available on MCA-21 portal is stated as under:
(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; (8) If a company is in default in complying with the provisions of this section, the company shall be liable to a penalty of three lakh rupees and every officer of the company who is in default shall be liable to a penalty of fifty thousand rupees.
5. Issue of Adjudication Notice:
This Office has conducted an Inquiry U/s 206 (4) of the Companies of the Companies Act, 2013 by an Officer authorized by the Central Government, the Inquiry report states that “The Board of the company for the financial year 2015-16 and 2016-17 has stated that the company has compiled with Accounting Standard as per provision of Section 134(5)(c) of the companies Act, 2013. However, the company has not disclosed the details of related party transactions of Directors’ current payables as per para 23 of AS-18 of companies (Accounting Standard), 2006However, the Inspecting officer has reported that, the Board of the company for the financial year 2015-16 and 2016-17 has stated that the company has compiled with Accounting Standard as per provision of Section 134(5)(c) of the companies Act, 2013. However, the company has not disclosed the details of related party transactions of Directors’ current payables as per para 23 of AS-18 of companies (Accounting Standard), 2006 Hence, there is a contravention of the provision of 134(5) ( c) of the Companies Act, 2013 for the financial year 2015-16 to 2017-18.
After that this office has issued show cause for adjudication vide letter No.ROC/CHN/073831/S.134/P.2/Inquiry//2020 on 21.06.2021 to the company and its Officers in default for non-compliance of Section 134 (5) (c) of the Companies Act, 2023.
6. Reply of Company and Directors for Adjudication Notice issued:
No reply has been received from the company and its directors.
7. Adjudication Hearing:
i) Since no reply has been received from the company and its directors for the Adjudication notice, the Adjudicating Authority had issued Adjudication Hearing Notice to the subject company and Officers in default on 15.09.2023 fixing the hearing date as 21.09.2023 at 03:00 PM. In reply to the Hearing Notice dated 15.09.2023, one of the directors of the company Mr. Rajiv Sharma has submitted a letter stating that he was an Independent -Non-Executive Director without any pecuniary benefits and resigned from the company from 01.12.2018. Other directors were not replied to the said notice. After that the Adjudicating Authority has issued final notice of hearing dated 13.10.2023 by fixing the hearing on 19.10.2023 at 02:30PM. Pursuant to the final hearing notice issued on 13.10.2023 fixing the date of hearing on 19.10.2023, Shri.Sanjay Kumar Sharma, Managing Director of the company has appeared before the undersigned on 19.10.2023 and made submissions that “the said violation may be adjudicated and accepted to pay the penalty as prescribed under Section 134(8) of the Companies Act, 2013”.
8. Decision
Having considered the facts and circumstances of the case and after taking into account the factors above, it is concluded that (i) the company and its Managing Director are liable for penalty as prescribed under Section 134(8) for violation of Section 134(5)(c) of the Companies Act,2013.
Accordingly, I am inclined to impose a penalty as prescribed under Sub-section 5 of Section 92 of the Companies Act, 2013. The details of the penalty imposed on the company and officers in default are shown in the table below:
| FYs | Name of person on whom penalty imposed | Penalty for
default (Rs) |
Maximum Limit for penalty (Rs) | Penalty Imposed (Rs) |
| 2015-16 | M/s. Anmol Ferro Impex Private Limited, Company | Rs.3,00,000/- | Rs.3,00,000/- | Rs.3,00,000/- |
| Mr. Sanjay Kumar Sharma, Managing Director |
Rs.50,000/- | Rs.50,000/- | Rs.50,000/- | |
| 2016-17 | M/s. Anmol Ferro Impex Private Limited, Company | Rs.3,00,000/- | Rs.3,00,000/- | Rs.3,00,000/- |
| Mr. Sanjay Kumar Sharma, Managing Director |
Rs.50,000/- | Rs.50,000/- | Rs.50,000/- | |
| 2017-18 | M/s. Anmol Ferro Impex Private Limited, Company | Rs.3,00,000/- | Rs.3,00,000/- | Rs.3,00,000/- |
| Mr. Sanjay Kumar Sharma, Managing Director |
Rs.50,000/- | Rs.50,000/- | Rs.50,000/- |
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.9,00,000/-(Rupees Nine lalchs) is imposed on the Company and Rs.1,50,000/- (Rupees One lalch fifty thousand) is imposed on the Managing Director. Totally Rs. 10,50,000 /- (Rupees Ten lakhs fifty thousand) as penalty for the said periods.
9. The said amount of penalty shall be paid 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.
(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
