ROC Imposes Penalty for Delay in Mandatory CFO Appointment

The Registrar of Companies (ROC), Patna initiated adjudication proceedings under Section 454 of the Companies Act, 2013 for violation of Section 203(5) relating to non-appointment of a Chief Financial Officer (CFO). The company became liable to appoint a whole-time CFO after its paid-up share capital exceeded Rs. 10 crore on 04.11.2016, as mandated under Rule 8 of the Companies (Appointment and Remuneration) Rules, 2014. However, the company failed to comply within the prescribed period and appointed a CFO only on 01.08.2017. During the hearing, the authorised representative argued that six months should be considered a reasonable compliance period and claimed the actual delay was 88 days. After considering the submissions, ROC imposed a penalty of Rs. 5 lakh on the company and Rs. 1.38 lakh each on several directors and officers in default for the continuing default between 04.05.2017 and 31.07.2017. The order also directed payment within 90 days and permitted appeal before the Regional Director, Kolkata.

GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
ROC Patna
ROC-cum-Official Liquidator, Ministry Of Corporate Affairs, High Court Of Patna, Maurya Lok Complex, Block “A” 4th Floor, Dak Bungalow Road, Patna, Bihar, India, 800001
Phone: 0612-2950121
E-mail: roc.patna@mca.gov.in

Order ID: PO/ADJ/05-2026/PT/02232| Dated: 22/05/2026

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. 698(E) dated 10/02/2026 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 .Individual details:

In the matter relating to BIJAY KUMAR KISHOREPURIA__________

In the matter relating to NITIN KISHOREPURIA__________

In the matter relating to SABITA DEVI KISHOREPURIA__________

In the matter relating to RACHNA KISHOREPURIA__________

In the matter relating to NAVNEET RANJAN__________

In the matter relating to ANJU SINGHANIA__________

In the matter relating to RACHITA KEDIA__________

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:

Default committed by the officers in default/noticee – According to Rule 8 of Companies (Appointment And Remuneration) Rules, 2014 every listed company and every other public company having a paid-up share capital of ten crore rupees or more shall have whole-time key managerial personnel. As on 04.11.2016 the company had paid up share capital of Rs.10,55,25,000/- it was required to appoint a Chief Financial Officer. Hence, company has done non-compliance of Section 203 of the Companies Act, 2013.

The hearing was scheduled on 18.05.2026 so that the company and its directors/officers-in-default could make an oral representation before the undersigned adjudicating officer in respect of show cause notice issued on 07.04.2026. On the date of hearing, CA Akshya Singhania, having a membership number 424348 has attended the hearing who was duly authorised to execute the same. He has made his submissions inter alia stating as ….The paid-up capital of the Company increased to Rs. 10,55,25,000 on 04.11.2016 and a period of 6 months from the date of applicability is considered reasonable for such compliance to be made u/s. 203(4) of the Companies Act, 2013. The company has appointed CFO on 01.08.2017. Therefore, the actual delay is 88 days

E. Order:

1. The aforesaid submissions made by the authorised representative of the company and its directors is considered and penalty is imposed for the non-compliance made by the company u/s. 203 of the Companies Act, 2013, i.e., non-appointment of CFO for the period between 04.05.2017 to 31.07.2017 on the company and its directors and key managerial personnel of the company.

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 Kolkata 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.

Dr Rameshkumar,
Registrar of Companies
ROC Patna