ROC Chandigarh imposes ₹10 Lakh Penalty for Delay in Appointing CFO

The Registrar of Companies, Chandigarh passed an adjudication order under Section 454 of the Companies Act, 2013 imposing penalties for violation of Section 203(1)(iii) read with Section 203(5) and Rule 8A of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The proceedings arose from a suo motu application filed by the company admitting an unintentional delay in appointing a Chief Financial Officer after its paid-up share capital crossed the statutory threshold of ₹10 crore. Despite becoming mandatorily liable to appoint a CFO, the company failed to do so for nearly one year, constituting non-compliance with key managerial personnel requirements. The adjudicating authority held the company and its officer in default liable and imposed a penalty of ₹5 lakh on the company and ₹50,000 on the officer, with no additional continuing penalty recorded. The order directs rectification and payment within 90 days through the MCA e-adjudication portal, clarifies personal liability of the officer for payment, and provides a right of appeal to the Regional Director within 60 days, warning of statutory consequences for non-payment.

GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
ROC Chandigarh
Registrar of Companies, Punjab and Chandigarh, 1st Floor, Corporate Bhawan, Plot No.4-B, Sector 27-B, Chandigarh, Chandigarh, India, 160019
Phone: 0172-2639415/2639416 E-mail: roc.chandigarh@mca.gov.in

Order ID: PO/ADJ/01-2026/CH/01348 | Dated: 07/01/2026

ORDER FOR ADJUDICATION OF PENALTY UNDER SECTION 454 OF THE COMPANIES ACT, 2013 (‘THE ACT’) FOR VIOLATION OF SECTION 203(5) 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 SAEL INDUSTRIES LIMITED………….

Individual details:

In the matter relating to JASBIR SINGH—

C. Provisions of the Act:

If any company makes any default in complying with the provisions of this section, such company shall be liable to a penalty of five lakh rupees and every director and key managerial personnel of the company who is in default shall be liable to a penalty of fifty thousand rupees and where the default is a continuing one, with a further penalty of one thousand rupees for each day after the first during which such default continues but not exceeding five lakh rupees.

D. Facts about the case:

1. Default committed by the officers in default/noticee – The Company has filed Suo moto application for adjudication vide SRN AB7888732 dated 01.10.2025 for the purpose of Adjudication of Penalties for non- compliance of clause (iii) of sub-section (1) of section 203 of the Companies Act,2013 read with Rule 8 of the Companies Act (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has made an unintentional delay in appointing of a Chief Financial Officer for a period starting from 04.01.2023 (i.e. six months from the threshold limits Rs. 10 crores by allotment of further shares on 04.07.2022) till 03.07.2023. On 04.07.2022, paid up share capital of the Company was increased to Rs. 46,12,90,970/- and crossed the aforesaid threshold limits of Rs.10 crores, accordingly, the Company was obligated to appoint Chief Financial Officer. Hence, the Company & its officers have violated the provisions of Section 203 of the Act read with Rule 8A of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

2. NA

E. Order:

1. NA

2. The details of penalty imposed on the company, officers in default and others are shown in the table below:

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 Noida 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.

Anupam Vashista,
Registrar of Companies
ROC Chandigarh