Penalty of Rs. 4 Lakhs imposed by MCA on Company and 3 Directors due to failure to maintain Registered Office [Read Order]

In the adjudication passed by the Ministry of Corporate Affairs (MCA) Registrar of Companies under Section 454 of the Companies Act, 2013, a penalty of Rs. 4 lakhs was imposed on a company and its 3 directors for the failure to maintain a registered office by the company.

The company named Shubhmangal India Nidhi Limited was registered under the Companies Act, 2013, on 1-5-2016, and its authorized capital is Rs. 15 lakhs.

In this case, an inquiry under Section 206 of the Companies Act, 2013, was initiated against the company. During the inquiry, a letter was issued to the registered address of the company but the letter was returned undelivered with the postal remark "IS NAAM KA KOI BHI VYAKTI DIYE GAYE PATE PAR NAHI REHTA, ATAH PRESHAK KO WAPAS", which means that the receiver could not be traced and the letter was returned back to the sender.

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This demonstrates that the firm failed to maintain a registered office as required and thereby violated Section 12 of the Companies Act, 2013, and the adjudicating authority held that the company and its directors are in default according to Section 2(60) of the Companies Act.

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 Actreads, “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.”

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Although a show cause notice was issued to the company and its officers on 25-4-24, 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.

As the company and its officers neglected to respond to the Show Cause Notice, therefore no hearing was scheduled.

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 4 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 Notice CLICK HERE

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