The Registrar of Companies, Mumbai, adjudicated a case under Section 454 of the Companies Act, 2013 for alleged violation of Section 450 by a private company and its director. The inquiry had observed that the company had changed its main objects in the Memorandum of Association (MoA) in 2020 but reported nil operational income in FY 2021–22, suggesting non-compliance with Section 4(1)(c). The company clarified that its MoA was duly amended to include consultancy and advisory services and that the reported “other income” originated from activities within its main objects, as per accounting norms. After providing an opportunity of hearing and examining submissions, the Adjudicating Officer concluded that no default was established since the company was operating as per its MoA. Consequently, no penalty was imposed on either the company or its officer. The order also outlined the right to appeal within sixty days.
GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
ROC Mumbai
Registrar Of Companies, 100, Everest, Marine Drive, Mumbai, Maharashtra, India, 400002
Phone: 022-22812627,022-22812645
E-mail: roc.mumbai@mca.gov.in
Order ID: PO/ADJ/11-2025/MB/00832 Dated: 10/11/2025
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 24/03/2015 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 DNYANESHWAR TRADING AND INVESTMENTS PRIVATE LIMITED [herein after known as Company] bearing CIN U74110MH2007PTC233726, is a company registered with this office under the Provisions of the Companies Act, 2013/1956 having its registered office situated at 1-B, COURT CHAMBERS 35,SIR VITHALDAS THACKERSEY MARG, NEW MA RINE LINES NA MUMBAI MUMBAI CITY MAHARASHTRA INDIA 400020
Individual details:
In the matter relating to REEMA KIRITKUMAR SHAH [herein after known as individual] having DIN 09487913 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 – Whereas the office of the Director General of Corporate Affairs, Ministry of Corporate Affairs vide letter no. F.No.8/10/2012-CL-II (WR) dated 14.08.2017 directed the office of Registrar of Companies, Mumbai (hereinafter referred to as the ROC) to conduct an inquiry under Section 206(4) of the Companies Act, 2013 in respect of the Subject Company. Accordingly, the said inquiry was conducted, and an inquiry report was submitted on 08.04.2025.
Whereas the IO in his inquiry report observed that the Company has changed its main objects in the Memorandum of Association vide Shareholders resolution dated 27.02.2020 pursuant to the Section 4 and 13 of the Companies Act, 2013. The amended object clause reads as follows:
To carry on the business or vocation or act as the consultants, Advisors and Management Consultants in the field of investment, finance? .
However, the IO has observed that while the operative income of the Company for the financial year ending 2021-2022 was Nil, the Company earned income from other sources amounting to Rs. 20,18,30,150/-. Thus, the Company did not conduct business as per the main objects mentioned in its Memorandum of Association, during the financial year ending 2021-22, in contravention of Section 4(1) (c) of the Companies Act, 2013. Thus, the IO concluded that the Company and every officer of the Company shall be liable under Section 450 of the Act.
2. An opportunity of being heard was granted by the Adjudicating Officer to the said noticees under the provisions of Section 454(4) of the Act on 29.10.2025 at 03:05 PM (IST) and notice bearing ID: EH/ADJ/10-2025/MB/00857 dated 15.10.2025 was issued for the same.
E. Order:
1. A.A Show Cause notice bearing ID: SCN/ADJ/07-2025/MB/02238 dated 04.08.2025 was issued to the Applicant on the E-adjudication module under Section 454 read with Section 450 of the Act for violation of Section 4(1) (c) of the Act.
B. The Applicant vide letter dated 14.08.2025 submitted his reply that:
i. The Company had duly amended its Memorandum of Association (MoA) on 27/02/2020 to include consultancy and advisory services in the field of investment and finance; to carry on business in securities etc; thus, the Company was carrying on its business as per its main object only.
ii. Non-generation of operative income from one of its main objects was not due to abandonment of the main object or any malafide intent or wilful contravention of the provisions of the Act. It was due to market reasons.
iii. Point no. 9.2 of the Schedule III of the Companies Act, 2013 which clearly states that income from interest, dividend and sale of investment needs to presented in other income and accordingly the income from current investment was reported as part of Other Income in the Profit & Loss Statement though this income was generated from one of the main objects. The Company has also attached a copy of balance sheet which indicates the same.
C. Non-generation of operative income from one of its main objects was not due to abandonment of the main object or any malafide intent or wilful contravention of the provisions of the Act. The Company continues to be engaged in carrying on the business activities as per main objects mentioned in its MoA. The Applicant has further requested for waiver of penalty in light of technical and unintentional lapse on the part of the Company
D. Thus, an opportunity of being heard was granted by the Adjudicating Officer to the said noticee under the provisions of Section 454(4) of the Act on 29.10.2025 at 03:05 PM (IST) and notice bearing ID: EH/ADJ/10-2025/MB/00857 dated 15.10.2025 was issued for the same.
E. The said hearing was attended by Ms Riddhi Krunal Shah, Practising Company Secretary on behalf of the noticees. She submitted as follows:
i. The Company had duly amended its Memorandum of Association (MoA) on 27/02/2020 to include consultancy and advisory services in the field of investment and finance; to carry on business in securities etc; thus, the Company was carrying on its business as per its main object only.
ii. She admitted that there was incorrect representation of the income from interest, dividend and sale of investment as other income instead of operating income.
F. Since, the Company had already amended the MOA to include consultancy and advisory services in the field of investment and finance; to carry on business in securities etc; the amended MOA was filed vide SRN R35569631 on 17.03.2020. It was carrying on the business as per MOA. Accordingly, no default is established under Section 4(1) (c) of the Act. Since, no default is established under Section 4(1)(c) of the Act, there shall be no order to penalty.
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 | DNYANESHWAR TRADING AND INVESTMENTS PRIVATE LIMITED having CIN as U74110MH2007P TC233726 | NA | 0 | 0 | 200000 |
| 2 | REEMA KIRITKUMAR SHAH having DIN as 09487913 | NA | 0 | 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 Mumbai 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.
Chandan Kumar,
Registrar of Companies
ROC Mumbai
