Failure to Intimate Director Resignation via DIR-12: MCA levies Rs. 2.5L Penalty [Read Notification]

The Ministry of Corporate Affairs ( MCA ) has penalized a private entity and its officers with a total fine of ₹2.5 lakh for failing to file Form DIR-12 to formally intimate the resignation of a director within the time limit fixed by the law.

The company, Lacework Security India Private Limited filed a suo motu application, voluntarily admitting its non-compliance with Section 168(1) of the CompaniesAct, 2013.

According to the company, an additional director, Christopher Scott Walt, was appointed on January 6, 2023, and subsequently resigned on June 20, 2023. However, the mandatory regulatory requirement of filing Form DIR-12 to notify the ROC of this resignation was missed.

The company acknowledged the lapse but submitted that the failure was unintentional. The management attributed the non-filing to technical glitches on the MCA-21 portal, a lack of cooperation from a former consultant, and specific complications in creating a personal business user account for the foreign director.

The company stated that improper processing of the initial appointment form caused a portal error showing the DIN unlinked with the company during resignation filing. It informed the ROC that it was non-operational, earning no revenue, and undergoing liquidation. The ROC sought further clarifications, including board resolutions and directors’ affidavits.

The company submitted affidavits confirming that the resigned director had neither signed any financial statements nor participated in any litigation in India during his tenure, and that the company assumed full responsibility for any actions taken during that period.

The ROC found statutory violations as the company failed to produce board meeting minutes verifying appointment and resignation dates. Considering its “small company” status under Section 2(85), reduced penalties under Section 446B were granted. Consequently, ₹1.5 lakh penalty was imposed on the company and ₹50,000 each on two officers, payable within 90 days.

Furthermore, the order clarified that paying the fine does not absolve the company of its duties; it must still file the pending DIR-12 forms and is required to formally disclose this adjudication order in its upcoming Board Report.

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