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2018 (10) TMI 119 - AT - Companies LawCompounding of an offence - application under Section 441 of the Companies Act, 2013 - defaulted in filing the Annual Return and Financial Statements within the statutory period for the financial year 2014-2015 - Held that - The income of the company is ₹ 36,479/- for the year ending 31st March, 2017, we reduce the amount payable by the Company to ₹ 50,000/- under Section 92. In so far as fine imposed under Section 137 is concerned, the same having calculated @ ₹ 1,000/- per day, we are not going to reduce the amount which has already been reduced to 1.5 lakhs. In so far as the rest of the Appellants are concerned, counsel for the Appellant did not pursue the case with regard to Appellant Nos.3 and 4, but prayer is made to reduce the amount so far as Appellant No.2 Mr. Anil Kumar Agarwal is concerned in view of his income. However, as we find that the fine has already been reduced to ₹ 1 lakh in each of the case, we are not inclined to interfere with the impugned order so far it relates to Mr. Anil Kumar Agarwal, Mr. Ved Prakash Jain and Mr. Kishan Lal Sharma. Their prayer is rejected.
Issues:
- Compounding of offences under Sections 92 and 137 of the Companies Act, 2013 - Reduction of fines imposed by the National Company Law Tribunal Analysis: 1. Compounding of Offences under Sections 92 and 137: The Appellant filed an application under Section 441 of the Companies Act, 2013 seeking to compound the offences under Section 92 and 137 for failing to file Annual Return and Financial Statements within the stipulated period for the financial year 2014-2015. The Registrar of Companies confirmed that the Company rectified the default by filing the required documents. The penal provisions for these offences are specified under Section 92(5) and Section 137(3) of the Act. 2. Fines Recommended and Imposed: The Registrar of Companies recommended fines for the offences under Sections 92 and 137. The fines were imposed on the applicants, including Shefield Appliances Limited, Mr. Anil Kumar Agarwal, Mr. Ved Prakash Jain, and Mr. Kishan Lal Sharma, for the default period from 30.11.2015 to 09.05.2017, amounting to ?5,00,000 each under Section 92(5) and ?5,60,000 under Section 137. 3. Decision of the National Company Law Tribunal: The National Company Law Tribunal, in its order dated 17th May 2018, compounded the offences and reduced the fines for the applicants. The fines were lowered to ?1.5 Lakhs each for Shefield Appliances Limited, and ?1 Lakh each for Mr. Anil Kumar Agarwal, Mr. Ved Prakash Jain, and Mr. Kishan Lal Sharma under both Sections 92(5) and 137, resulting in a total fine of ?3 Lakhs and ?2 Lakhs, respectively. 4. Reduction of Fines by the Appellate Tribunal: Upon hearing the counsel for the Appellant and considering the company's income, the Appellate Tribunal further reduced the amount payable by the Company to ?50,000 under Section 92. However, the fine imposed under Section 137 was not reduced, as it was calculated at ?1,000 per day. The Tribunal declined to interfere with the fines already reduced for Mr. Anil Kumar Agarwal, Mr. Ved Prakash Jain, and Mr. Kishan Lal Sharma, maintaining the fines at ?1 Lakh each for these individuals. 5. Conclusion and Disposal of Appeal: The appeal was disposed of with appropriate directions, and no additional costs were imposed. The Tribunal rejected the prayer to further reduce the fines for Mr. Anil Kumar Agarwal, Mr. Ved Prakash Jain, and Mr. Kishan Lal Sharma, based on their respective incomes and the fines already reduced in the previous order.
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