ROC Imposes Penalty on Company and Director for Furnishing Incomplete Details in Form PAS-3

The Registrar of Companies (ROC), Chennai, has imposed a penalty on a company and its director for not disclosing the mandatory information required under Rule 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

The company Mulagumoodu Vicariate Catholic Nidhi Limited had filed the Form NDH-4, which was rejected by the Ministry of Corporate Affairs (MCA) for not mentioning the full details on the list of allottees submitted in Form PAS-3. This was a mandatory requirement under Rule 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014. Rule 14(6) mandates companies to file a return of allotment (in Form PAS-3) with the Registrar of Companies (ROC) within 15 days along with a complete detail of all the allottees, such as the name, address, PAN, email, security class, allotment date, number of securities held, nominal value and amount paid on the securities, etc.

The company had failed to provide full information, such as PAN numbers and email IDs of some allottees, violating Rule 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

The company argued that some allottees did not have PAN or email IDs and that the rule was not applicable in its case. However, the ROC did not accept these explanations and held the company and its directors liable under Section 450 of the Companies Act, 2013.

Accordingly, the ROC imposed a penalty of Rs 10,000 on the company and Rs 10,000 on its director for violating Rule 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014. The company has been directed to correct the default and pay the penalty within 90 days via the ‘e-Adjudication’ facility on the MCA Portal.