Non-Compliance with Beneficial Ownership Disclosure under Companies Act: MCA imposes Penalty on Private Limited Company & Directors
A penalty of Rs. 7.35 lakhs was imposed on a private limited company and its directors due to non-compliance with beneficial ownership disclosure under the Companies Act
MCA – MCA imposes penalty – MCA imposes penalty on Private Limited Company – penalty on Private Limited Company – taxscan
MCA – MCA imposes penalty – MCA imposes penalty on Private Limited Company – penalty on Private Limited Company – taxscan
In the recent order of adjudication passed by the Ministry of Corporate Affairs ( MCA ) Registrar of Companies, a penalty of Rs. 7.35 lakhs was imposed on a private limited company and its directors due to non-compliance with beneficial ownership disclosure under the Companies Act, 2013.
The inquiry report under Section 208 of the Companies Act, 2013, was submitted to the Directorate on 22-11-2022. The company, primarily owned by Mr. Chen Jufeng (99%), had not filed e-form BEN-2, a crucial requirement under Section 90 of the Act, to declare its significant beneficial owner.
Despite a letter issued on February 15, 2024, reminding the company of its obligation, no response was received. This raised concerns, prompting the issuance of a Show Cause Notice (SCN) on May 21, 2024, and summoning the company and its directors for a hearing on May 31, 2024. Yet, no one showed up.
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With repeated notices ignored and no representation from the company, it became evident that they had failed to issue Form BEN-4 and obtain the necessary declarations. After 1,247 days of non-compliance, the default under Section 90 and the SBO Rules stood established, leading to the adjudication of penalties against the company and its officers.
The order also contained that the notice must pay the penalty individually via e-payment on the MCA website under "Pay Miscellaneous Fees" within 90 days, and an appeal can be filed with the Regional Director (Northern Region), Ministry of Corporate Affairs, within 60 days using Form ADJ, along with a certified copy of this order.
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It was also stated that non-compliance may attract further action under Section 454(8) of the Companies Act, 2013.
This order was issued by Seema Rath, Registrar of Companies & Adjudicating Officer, Uttar Pradesh, Kanpur.
To Read the full text of the Order CLICK HERE
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