In a recent adjudication order passed by the Ministry of Corporate Affairs (MCA), Registrar of Companies (ROC), Uttar Pradesh, Swastik Mutual Benefits Limited and its directors were penalized Rs. 8,42,800 for failing to attach cash flow statements with their financial statements for the financial years 2014-2015 to 2018-2019, in violation of Section 137 of the Companies Act, 2013.
Swastik Mutual Benefits Limited, a company incorporated under the Companies Act, 2013, on May 8, 2013, has its registered office in Allahabad, Uttar Pradesh, with an authorized capital of Rs. 25,00,000. During the inquiry, it was found that the company and its directors failed to file their cash flow statements along with the balance sheet for five consecutive financial years a mandatory requirement under Section 137(1) of the Companies Act, 2013. This non-compliance resulted in penalties under Section 137(3) of the Act.
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The ROC observed that a Show Cause Notice (SCN) was issued on May 30, 2024, to the company and its directors Shiv Ji Sahu, Om Ji Gupta, and Pallavi Sahu, seeking an explanation for the default. However, neither the company nor the directors responded or appeared for a hearing, confirming their failure to comply with the law.
For each financial year from 2014-15 to 2018-19, the company was penalized Rs. 1,00,000 per year for non-compliance. Each director was fined Rs. 25,000 per year for failing to ensure compliance with Section 137 of the Companies Act, 2013. The total penalty imposed on the company and its directors for all five years amounted to Rs. 8,42,800.
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The order, issued by Seema Rath, Registrar of Companies & Adjudicating Officer, Uttar Pradesh, Kanpur, mandates that the penalty must be paid within 90 days via demand draft in favor of “Pay & Accounts Officer, Ministry of Corporate Affairs, New Delhi.”
The company has the right to appeal within 60 days to the Regional Director (Northern Region), Ministry of Corporate Affairs, New Delhi, using Form ADJ, accompanied by a certified copy of the order. Failure to comply may result in further enforcement actions under Section 454(8) of the Companies Act, 2013.
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