ROC Imposes Rs. 1.4 Lakh Penalty for Incomplete Allottee Details in PAS-3 Filing

The Registrar of Companies (ROC), initiated adjudication proceedings against Sri Narayani Benefit Fund Nidhi Limited and its officers for non-compliance with the provisions of the Companies Act, 2013, specifically concerning the regulatory framework for Nidhi companies. The company was found to have violated Section 406 of the Act read with the Nidhi Rules, 2014. Despite being a registered Nidhi company, it failed to adhere to the mandatory operational requirements and statutory filings prescribed for such entities.

An adjudication notice was issued, and although a hearing was scheduled, the company could not sufficiently demonstrate compliance with the regulatory standards required to maintain its status and operational legitimacy.

Issue Before Registrar: Whether the company and its directors are liable for penalties under Section 450 of the Companies Act, 2013, for contravening the provisions of Section 406 and the Nidhi Rules, where no specific penalty is provided elsewhere in the Act.

ROC’s Ruling: The Adjudicating Officer found the company and its directors guilty of the violations and imposed a total penalty of Rs. 1,40,000. Under Section 450, where no specific penalty is provided for a contravention, the company and every officer in default are liable to a penalty of ten thousand rupees, and in case of continuing contravention, a further penalty of one thousand rupees for each day.

The ROC imposed a penalty of Rs. 50,000 on the Company and Rs. 30,000 each on the three directors. The order specifically directed that the penalties imposed on the directors must be paid from their personal income and warned of further action under Section 454(8) for non-payment.

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