Penalty Revoked: RD Sets Aside ROC Fine Over Secretarial Standards Compliance:

Penalty Revoked: RD Sets Aside ROC Fine Over Secretarial Standards Compliance Recently, the Regional Director (RD) has revoked the penalty of Rs. 120,000 imposed on Stanley Oem Sofas Limited and its three directors, as the requirement of disclosing the no and dates of meetings of the Board and committees held during the financial year has been removed after the 2017 amendment in Secretarial Standards (SS-1).  Stanley Oem Sofas Limited, based in Bengaluru, Karnataka, along with its three directors (Appellant), had filed an appeal dated 27.05.2025 under section 454(5) of the Companies Act, 2013, using e-form ADJ (SRN AB4266128), before the Regional Director (South East Region) of the Ministry of Corporate Affairs (MCA), Hyderabad, and was challenging an adjudication order (F.No. ROCB/Adj.454-118(10)/Stanley OEM Sofas/Co.No.084973/2025/6686 to 6689) dated 23.03.2025, issued by the Registrar of Companies (ROC), Bangalore, under Section 454(5) and Section 118(10) of the Companies Act, 2013.

Also Read

JioFinance Offers ITR Filing at Rs 24, But Why Share Income Data When Government Portal Is Free?

The ROC's order dated 23.03.2025 was penalising the company and its three directors under Section 118(11) of the Act for violation of Section 118(10) of the Companies Act, 2013. The order was issued after hearing Mr. Vamsikrishna K. and Mr. Vinu Thomas, practising company secretaries, on 06.03.2025, confirming the penalty amount, as mentioned below:

• Stanley OEM Sofas Ltd. was fined Rs. 75,000 (Rs. 25,000 for each year of default).
• Each of the three directors was fined Rs. 15,000 (Rs. 5,000 per year), totalling Rs. 45,000 for all directors.
• Total penalty imposed: Rs. 120,000 (Rs. 75,000 + Rs. 45,000)

The Regional Director (South East Region) of the Ministry of Corporate Affairs (MCA), Hyderabad, heard the appeal on 24.07.2025. From the side of petitioners, Mr. Vinu Thomas, Company Secretary in practice/authorised representative, attended the personal hearing. ROC alleged the company for not disclosing the exact dates of Board Meetings in the Director’s Reports for the financial years 2017-18, 2018-19, and 2019-20, which is a violation of SS-1 (Secretarial Standard on Meetings of the Board of Directors). On which, the representatives explained that the Secretarial Standards were changed in 2017, which removed the requirement of "disclosing the number and dates of meetings of the Board and committees held during the financial year, indicating the number of meetings attended by each director." Hence, based on the amended SS-1, the company followed the latest version and did not disclose the meeting dates, thinking it was not mandatory anymore.

Also Read

Three Major Changes in August 2025 You Should Know; New ICICI Bank Rules, FASTag Annual Pass, and Other

When the Regional Director (RD) listened to both arguments, it concluded, considering the amendment made to the SS-1, that since the relevant part of SS-1 requiring disclosure of meeting dates had already been removed, there was no actual violation committed by the company. Therefore, RD set aside the ROC's order dated 23.03.2025 and revoked the penalty imposed on the company and its directors.