MCA IMPOSES PENALTY FOR OMITTING EMAIL AND PHONE ON COMPANY LETTERHEAD
Introduction:
Explore an in-depth analysis of a case involving penalties imposed by the Ministry of Corporate
Affairs for the omission of crucial contact information on a company’s letterhead, in accordance with the
Companies Act, 2013.
Analysis:
In a recent case, the Ministry of Corporate Affairs undertook adjudication proceedings against
Riverdale Foundation, a registered company under the Companies Act, 2013. The case pertains to the violation
of section 12(3) of the Act, which mandates that companies display essential information, including their name,
registered office address, Corporate Identity Number, and contact details, on various official documents and
communications.
The specifics of the case are as follows:
Background:
The Ministry of Corporate Affairs appointed an Adjudicating Officer to oversee the case under the
powers granted by section 454 of the Companies Act, 2013, and the Companies (Adjudication of Penalties)
Rules, 2014.
Violation:
Riverdale Foundation, registered with CIN: U80101CT2017NPL008058, allegedly failed to include
its email id and phone number on a resolution attached to form GNL-1. This omission directly contravened
section 12(3)(c) of the Companies Act, 2013.
Penalties Imposed:
The omission of contact information led to penalties being imposed under section 12(8) of
the Act. The penalty amounted to Rs. 28,000 per day of default, not exceeding Rs. 1,00,000. The company, as
well as the directors, Satija Nikish and Akshat Goyal, were deemed liable for the penalty.
Company’s Response:
In response to the show-cause notice, the company admitted the oversight but argued
that it was unintentional and that steps had been taken to rectify the mistake. Despite this explanation, penalties
were still levied.
Adjudication and Order:
The case went through an adjudication process. A “Notice of Inquiry” was issued, but
the company and its directors did not appear for the hearing. The absence of their presence resulted in the case
proceeding in their absence.
The Adjudicating Officer concluded that the company’s failure to print its email id and phone number on the
resolution attached to form GNL-1 constituted a violation of section 12(3) of the Act. As a result, penalties were
confirmed and imposed.
Conclusion:
This case serves as a cautionary tale for companies, emphasizing the importance of adhering to the
legal requirements outlined in the Companies Act, 2013. Omitting critical contact information on official
documents can lead to severe penalties. The analysis underscores the significance of compliance and the
consequences of failing to meet statutory obligations. It further highlights the process of adjudication and the
meticulous examination of evidence before penalties are imposed by regulatory authorities.
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