Section 89: ROC Levies Penalty of Rs 17 Lakh for Delay in Filing MGT-6

Form MGT-6 is an important document under Section 89 of the Companies Act, 2013, that must be filed with the registrar to disclose the persons who are listed as shareholders in the registered members list but have no beneficial interest in shares. This section requires all such companies to file Form MGT-6. In a recent case, one company delayed the filing, which resulted in a penalty imposed by the Registrar of Companies (ROC) on the company and its officers.

Mr Ayan Barua was a shareholder of the company named G2.Com India Private Limited. He was the registered holder of one share, while the beneficial owner was Siftery Inc. (formerly G2.com Inc.). He submitted a declaration in Form No. MGT-4 to the company on 08.03.2016. The Companies Act requires such companies to file Form MGT-6 within 30 days from the date they received a declaration from a registered member about the non-beneficial ownership of shares. However, in this case, the company did not file MGT-6 within the given time period under section 89(6) of the Act and filed it after 8 years on 20.03.2024, violating the provisions of section 89 from 08.04.2016 to 19.03.2024.

Under section 89(7) of the Companies Act, if a company does not file the form within the required time, it and the responsible officer will be liable to pay a penalty. Therefore, ROC levied a penalty of Rs 5 lakh on the company and Rs 2,00,000 each on the seven officers in default for violating the provisions of section 89 of the Act.

The company is required to pay the penalty amount within 90 days and file Form INC-28 attaching a copy of the Order and payment challans. ROC warned that if payment is not made, further action under Section 454(8) of the Act may be taken.

The company or any director is allowed to file an appeal within 60 days to the Regional Director, South East Region, Hyderabad, using Form ADJ.