Non Maintenance of Registered Office: MCA imposes Rs. 7 lakhs penalty on Company and Directors [Read Notification]

In the adjudication passed by the Ministry of Corporate Affairs (MCA) Registrar of Companies, a penalty of Rs. 4 lakhs was imposed on a private limited company and its directors for the failure to maintain a registered office by the company.

The company was registered under the Companies Act, 2013, on 14-9-2017, and its authorized capital is Rs. 5 lakhs.

The Ministry of Corporate Affairs had rejected the company's e-form NDH-4. Following that, the office sent a letter to the company’s registered office asking for clarifications and additional information. But, the letter was returned undelivered with the postal remark that the recipient was not found and the letter had been returned to the sender.

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This proves the fact that the company was not maintaining a registered office as required and is therefore in violation of Section 12 of the Companies Act, 2013.

Section 12(1) of the Companies Act states that “a company shall, within thirty days of its incorporation and at all times thereafter, have a registered office capable of receiving and acknowledging all communications and notices as may be addressed to it.”

Section 12(4) QI of the Act reads,“Notice of every change of the situation of the registered once, verified in the manner prescribed, after the date of incorporation of the company, shall be given to the Registrar within thirty days of the change, who shall record the same. “

 Section 12(8) of the Act further provides that “(if any default is made in complying with the requirement of this section, the company and every officer who is in default shall be liable to a penalty of one thousand rupees for every day during which the default continues but does not exceed one lakh rupees.”

Although a show cause notice was issued to the company and its officers, no reply was furnished. It was observed by the adjudicating authority that either the company was not maintaining a registered office or they failed to inform regarding the change of address.

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The adjudicating authority reached the conclusion that the company violated the provisions of Section 12 of the Companies Act and imposed a total penalty of Rs 7 lakhs on both the company and the directors, and the fine imposed has been properly stated in the order in the table.

This order was issued by Seema Rath, Registrar of Companies & Adjudicating Officer, Uttar Pradesh, Kanpur.

To Read the full text of the Notification CLICK HERE

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