POWER OF REGIONAL DIRECTOR TO COMPOUND OFFENCES UNDER COMPANIES ACT, 2013

[Mr. M. GOVINDARAJAN]

The Companies Act, 2013 provides for compounding of offences committed either by a company or any officer of the Company.  The Regional Director is having power to compound the offence punishable under this Act with fine only and where the maximum amount of fine which may be imposed for such offence does not exceed ₹ 5,00,000.  The following cases can be compounded by the Regional Director:

Sl. No.	Section	Nature of offence	Fine
1	11(2)	Committing default in complying with the requirements relating to commencement of business.	Fine upto ₹ 5,000 on company. Fine upto ₹ 1,000 for each day of default (for officer in default)
2	16(3)	Committing default in complying with the directions issued under sub-section (1) relating to rectification of name of company	Fine upto ₹ 1,000 for each day of default on company. Fine not less than ₹ 5,000 but may be extended to ₹ 1 lakh (for officer in default)
3	26(9)	Contravention of provisions relating to issue of a prospectus	Fine from ₹ 50,000 to 3 lakh on company.
4	53(3)	Violation of provisions relating to issue of shares at discount	Fine not less than ₹ 1 Lakh but may be extended to ₹ 5 lakh on company
5	56(6)	Failure to comply with the provision relating transfer and transmission of securities under sub-section (1) to (5)	Fine not less than ₹ 25,000 but may be extended to ₹ 5 lakh on company. Fine not less than ₹ 10,000 but may be extended to ₹ 1 lakh (for officer in default)
6	59 (5)	Committing default in complying with the order of Tribunal relating to rectification of register of members	Fine not less than ₹ 1 lakh but may be extended to ₹ 5 lakh on company
7	64(2)	Failure to file a notice related to alteration, increase or redemption of share capital along with the altered memorandum with the Registrar	Fine upto ₹ 1,000 for each day of default continues, or five lakh Rupees whichever is less
8	67(5)	Contravening provisions relating to purchase by company or loans by company for purchase of its own shares	Fine not less than ₹ 1 lakh but may be extended to ₹ 25 lakh on company. [If more than 5 lakh then compoundable by the Tribunal]
9	68(11)	If a company makes any default in complying with the provisions of this section or any regulation made by the Securities and Exchange Board relating to buy back of securities	Fine not less than ₹ 1 lakh but may be extended to ₹ 3 lakh on company
10	86	Contravention of any provision of Chapter VI relating to Registration Of charges	Fine not less than ₹ 1 lakh but may be extended to ₹ 10 lakh on company
11	88(5)	Failure to maintain register of members or debenture-holders or other security holders as prescribed	Fine not less than ₹ 50,000 but may be extended to ₹ 3 lakh and further fine up to ₹ 1000/- for each day of default in case failure continues
12	89(5)	Failure to file declaration not holding beneficial interest in any share	Fine upto ₹ 50,000 and further fine up to ₹ 1,000/- for each day in case failure continues
13	89 (7)	Failure to file return relating to beneficial interest in any share before the expiry of the time specified under the first proviso to sub-section (1) of section 403	Fine not less than ₹ 500 but may be extended to ₹ 1,000 on company & every officer who is in default and further fine up to ₹ 1000 for each day of default in case of failure continues
14	92 (6)	If a company secretary in practice certifies the annual return otherwise than in conformity with the requirements of this section or the rules made there under.	Fine which shall not be less than ₹ 50,000 but may be extended to ₹ 5 lakh
15	99	Default in holding a meeting of the company in accordance with section 96 or section 97 or section 98 or in complying with any directions of the Tribunal	Fine upto ₹ 1 lakh on company & every officer who is in default and further fine up to ₹ 5,000/- for each day of default in case failure continues
16	102 (5)	Default in complying with the provisions of this section relating to statement to be annexed to notice	Fine upto ₹ 50,000 or 5 times the amount of benefit accruing to the promoter, director, manager or other key managerial personnel or any of his relatives, whichever is more
17	105(3)	If default is made in complying with sub-section (2) relating to proxies	Fine up to ₹ 5,000 on every officer who is in default
18	105(5)	If invitations to appoint as proxy a person or one of a number of persons specified in the invitations are issued	Every officer of the company who knowingly issue or willfully authorizes or permits their issue shall be punishable with fine up to ₹ 1 lakh
19	121(3)	Failure to file report on annual general meeting	Fine not less than ₹ 1 lakh but may be extended to ₹ 5 lakh on company. Fine not less than ₹ 25,000 but may be extended to ₹ 1 lakh (for officer in default)
20	124(7)	Failure to transfer the amount of accumulated profits to unpaid dividend and violating other provisions of Section 124	Fine not be less than ₹ 1 lakh but may be extended to ₹ 5 lakh or with both (for every officer in default)
21	137(3)	Failure to file financial statements with the Registrar	Fine up to ₹ 1,000/- for each day of default, but maximum up to ₹ 10 lakh
22	140(3)	Non compliance by auditor of sub section (2) relating to filing of registration information	Fine not less than ₹ 50,000 but may be extended to ₹ 5 lakhs on auditor/audit firm
23	147(1)	Failure of company to comply with the provisions of sections 139 to 146 with regard to auditors	Fine not less than ₹ 25,000 but may be extended to ₹ 5 lakh on company
24	157(2)	Failure to furnish DIN to Registrar	Fine not less than ₹ 25,000 but may be extended to ₹ 1 lakh on company and every officer in default
25	165 (6)	Acting as a director of more than 20 companies	Fine not less than ₹ 5,000 but may be extended to ₹ 25000 for each day of default
26	166(7)	Default in complying with the provisions of this section relating to directors duties	Fine not less than ₹ 1 lakh but may be extended to ₹ 5 lakh on directors
27	172	Contravention of the provisions of Chapter XI relating to appointment and qualifications of directors	Fine not less than ₹ 50,000 but may be extended to ₹ 5 lakh
28	178(8)	Default in complying with the provisions of Section 177 & of this section relating to Committee like Nomination, Remuneration and Stakeholders Relationship Committee	Fine not less than ₹ 1 lakh but may be extended to ₹ 5 lakhs on company
29	188 (5)(ii)	Related party transaction in case of other country	Fine not less than ₹ 25,000 but may be extended to ₹ 5 lakh
30	187 (4)	Contravention of the provisions of this section relating to investment of company held in its name	Fine not less than ₹ 25,000 but may be extended to ₹ 25 lakhs on company
31	191 (5)	Contravention of the provisions of this section relating to payment to director for loss of office in connection with transfer of property	Fine not less than ₹ 25,000 but may be extended to ₹ 1 lakh on such director
32	197 (15)	Contravention of the provisions of this section relating to managerial remuneration in case of absence or inadequacy of profits	Fine not less than ₹ 1 lakh but may be extended to ₹ 5 lakhs.
33	203 (5)	Contravention of the provisions of this section relating to appointment of Key Managerial personnel.	Fine not less than ₹ 1 lakh but may be extended to ₹ 5 lakh on company. Fine up to ₹ 50,000 on Director or Key Managerial Person who is in default and further fine up to ₹ 1000 for each day of default in case of the contravention continues
34	204(4)	Contravention of the provisions of this section relating to Secretarial Audit for bigger companies	Fine not less than ₹ 1 lakh but may be extended to ₹ 5 lakh on the company, every officer of the company and company secretary in practice.
35	206(7)	Failure to furnish any information during inspection or inquiry	Fine up to ₹ 1 lakh and further fine up to ₹ 500 for each day of default on the company and every officer of the company
36	221(2)	Any removal, transfer or disposal of funds, assets or properties of the company in contravention of the order of the Tribunal under sub-section (1)	Fine not less than ₹ 1 lakh may be extended to ₹ 25 lakh on company.
37	222(2)	Securities in any company are issued or transferred or acted upon in contravention of an order of the Tribunal under sub-section (1)	Fine not less than ₹ 1 lakh but may be extended to ₹ 25 lakh on company
38	232 (8)	Contravention of the provisions of the transfer and transferee company in case of merger or amalgamation	Fine not less than ₹ 1 lakh but may be extended to ₹ 25 lakhs on company
39	238(3)	Failure to register the offer of schemes involving transfer of shares	Fine not less than ₹ 25,000 but may be extended to ₹ 5 lakhs on director who issue such circular
40	242(8)	Contravention of the order of the Tribunal relating to alterations in memorandum of articles	Fine not less than ₹ 1 lakh but may be extended to ₹ 25 lakh on company
41	247 (3) proviso	Contravention of the provisions of this section by the valuer	Fine not less than ₹ 25,000 but may be extended to ₹ 1 lakh
42	249(2)	Filing of application in restricted cases for removal of name	Fine up to ₹ 1 lakh
43	302 (4)	Committing default by official liquidator in forwarding a copy of the order of dissolution of company by trial with the period specified in sub section (3)	Fine up to ₹ 5000 for each day of default (on company liquidator)
44	306(5)	Default in calling the meeting of the creditors, to prepare a statement of the position of the company’s affairs along with a list of creditors, estimated amount of claim and filing the resolution with Registrar.	Fine not less than ₹ 50,000 but may be extended to ₹ 2 lakh
45	307(2)	Default in publication of resolution to wind up voluntarily	Fine up to ₹ 5,000 for each day of default on company and every officer of the company
46	312(2)	Failure to give notice of appointment of Company Liquidator to Registrar	Fine up to ₹ 500 for each day of default on company and every officer who is in default
47	314 (5)	Failure to prepare quarterly statement of accounts by company liquidator in voluntary winding up and file with Registrar under sub-section (5)	Fine up to ₹ 5000 for each day of default (on company liquidator)
48	318(8)	Failure to complying with the provisions of this section relating to final meeting and dissolution of company	Fine up to ₹ 1 lakh (on company liquidator)
49	342(6)	Failure to neglect to give assistance required under sub-section (5)	Fine not less than ₹ 25,000 but may be extended to ₹ 1 lakh
50	344 (2)	Failure to give statement that the company is in liquidation	Fine not less than ₹ 50000 but may be extended to ₹ 3 lakhs
51	348(6)	Contravention of the provisions of information as to pending liquidation	Fine up to ₹ 5,000 for each day of default (for company liquidator)
52	356(2)	Failure to file certified copy of the order of Tribunal relating to dissolution of company void with the Registrar.	Fine up to ₹ 10,000 for each day of default (for company liquidator or the person on whose application the order was passed)
53	392	Contravention of the provisions of Chapter XXII by a foreign company	Fine not less than ₹ 1 lakh but may be extended to ₹ 3 lakh fine and further  fine up to ₹ 50,000 for each day of default
54	405(4)	Failure to furnish information or statistics etc., by the companies required by the Central Government	Fine up to ₹ 25,000 on company
55	450	No specific penalty or punishment is provided in the Act	Fine up to ₹ 10,000 and further fine up to ₹ 1,000 for each day of default in case of contravention continue
56	451	Repeated default within 3 years	Twice the amount of fine for such offence in addition to any imprisonment provided for that offence
57	452(1)	Punishment for wrongful withholding of property	Fine not less than ₹ 1 lakh but  may be extended to ₹ 5 lakh on officer or employee of the company
58	453	Improper use of words ‘limited’ and ‘private limited’	Fine not less than ₹ 500 but may be extended to ₹ 2000 for each day of default
59	454(8)	Failure to pay the penalty imposed by the adjudicating officer or Regional Director	Fine not less than ₹ 25,000 but may be extended to ₹ 5 lakh on company
60	464(3)	Being a member of a company formed exceeding certain numbers	Fine up to ₹ 2 lakh and liabilities incurred in such business
61	469(3)	Contravention of the Rules framed by Central Government	Fine up to ₹ 5,000 and further fine up to ₹ 500 for each day of default in case of contravention continues.
62	186 (13)	Contravention of the provisions of this section relating to loans and investments	Fine not less than ₹ 25,000 but may be extended to ₹ 5 lakhs on company