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TMI Blog2018 (7) TMI 460X X X X Extracts X X X X X X X X Extracts X X X X ..... on 203(1)(iii) of the Companies Act, 2013 in terms of the provisions of section 441 of the Act. Accordingly, we do hereby compound the aforesaid offence against the Applicants subject to depositing the compounding fees by each of the applicants within 15 days hereof - Company Petition No. 386/KB/2018 - - - Dated:- 4-5-2018 - Shri JINAN K. R. AND Shri M. B. Gosavi, JJ. For The Applicants : Mr. Sayantan Bose, Advocate, Ms. Sukriti Rai, Advocate And Ms. Madhurima Das ORDER Per Shri Jinan K. R., Hon'ble Member (Judicial) The instant Company Application has been filed under section 441 of the Companies Act, 2013 (the Act), praying for compounding of offence allegedly committed under section 203(1)(iii) of the Act, as indicated in the show cause notice dated 06.09.2016, bearing No. ROC/69502/Inspn/206(5)/203(iii)/DNC/4/72, 73 76 issued by Registrar of Companies, West Bengal (RoC. WB). The said application has been filed by the 6 (six) applicants supported by an affidavit affirmed by Ms. Sushmita Sur, Constituted Attorney of all the applicants, on 06.09.2017. Applicant No.1 was the Manager of the company, Applicant Nos. 2 continues as a Director and Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... more extensive. Note 24 of the financial statements of the Petitioner Company for the financial year ended 31st March, 2015 also includes specific disclosure in this regard. In fact, such appointment of the Chief Financial Officer, the Manager and the Company Secretary was made prior to the receipt of the show cause notice and as such no violation has subsisted as on the date of the show cause notice. It has also stated that the Company had appointed Ms. Daisy Mehta as Company Secretary on 20th July 2012 and as Manager on 28th August 2012; but, she resigned from the Company on 31st March 2015. Thereafter, the Company appointed Mr. Amit Ramesh Vegad as its Company Secretary and Manager on 1st April 2015 and he also resigned from the Company on 29th April 2016. The applicants did not have any mala fide intention or ulterior motive in not appointing the relevant key management personnel. The Company is a closely held unit and it does not have any public shareholders. None of the members or creditors of the Company or any third party has been prejudicially affected by the non-appointment of the Chief Financial Officer and the appointment of a single individual as the Manager and Compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant records of the company carried out under petition 206(5) of the Companies Act, 2013. 4. It would be relevant to refer to the provisions of section 203(1) of the Companies Act, 2013 which reads thus: Every company belonging to such class or classes of companies as may be prescribed shall have the following whole-time key managerial personnel:- (i) managing director, or Chief Executive Officer or manager and in their absence, a whole-time director; (ii) company secretary; and (iii) Chief Financial Officer. Provided that an individual shall not be appointed or reappointed as the chairperson of the company, in pursuance of the articles of the company, as well as the managing director or Chief Executive, Officer of the company at the same time after the date of commencement of this Act unless, - (a) the articles of such a company provide otherwise; or (b) the company does not carry multiple business. Provided further that nothing contained in the first proviso shall apply to such class of companies engaged in multiple businesses and which has appointed one or more Chief Executive Officers for each such business as may be notified by the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Inspecting Officer in course of inspection of the books of account and other relevant records of the company carried out under section 206(5) of the Companies Act, 2013 and the said breach of section 203(1)(iii) has been rectified. The compounding application has been filed by the Applicants after initiation of prosecution by the RoC, WB. There is wide scope and power vested in the Tribunal to compound the offence of the nature provided in the section either before or after the institution of any prosecution. Offence under section 203(5) of the Companies Act, 2013 is punishable with fine only. It is not in dispute that the Applicants have violated the provisions of section 203(1)(iii) of the Act as noticed by the Inspecting Officer in course of inspection of books of accounts and our records of the Company carried out under Section 206(5) of the Companies Act, 2013. Subsequently, the Company appointed Chief Financial Officer, Manager and Company Secretary on 23.08.2016 and it has also filed Form DIR-12 as confirmed by RoC, WB in his report dated 18.10.2017 and thus, the offence has been made good on 23.08.2016. The said offence relates to the financial year 2014-15. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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