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TMI Blog2020 (10) TMI 703X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, on specifying quantum of payment, however, such sum should not in any case exceed the maximum amount of fine which may be imposed for the offence so compounded. The quantum of penalty specified by the ROC in his report furnished maximum penalty prescribed under the relevant section. There is no minimum penalty prescribed under the section and it only says upto one lakhs and upto ₹ 5000 per day. Therefore, the Tribunal has to take into consideration of the extenuating circumstances as available in given case. As stated supra, the Learned Counsel, has satisfactorily explained to Tribunal, the reasons for committing violations/offences in question, so as consider to impose minimum penalty. He is also justified to take a plea of present adverse economic situation arise due to pandemic. Therefore, we are inclined to take a lenient view of matter and thus want to impose minimum Compounding fine. Application allowed in part. - C.P. No. 73/BB/2020 - - - Dated:- 5-6-2020 - Rajeswara Rao Vittanala, Member (J) And Ashutosh Chandra, Member (T) For the Appellant/Respondent: G.M. Ganapathi ORDER RAJESWARA RAO VITTANALA, MEMBER (J) 1. C.P. No. 73/BB/2020 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -18 on 15th February, 2019. Thereby, the Company has delayed in holding the Annual General Meeting for the financial year 2016-17 by 474 days and for 2017-18 by 137 days. (4) The Company is in the business of conducting clinical trials, analytical and pharmaceutical services in India and Abroad or bio-pharmaceutical Industry. It has undertaken various studies for Companies seeking to introduce their pharmaceuticals into United States thereby requiring the inspection of United States Food and Drug Administration (US FDA). Hence the Company's facilities were inspected by USFDA/WHO. During October 2015, the USFDA team made inspection of the Company's bioavailability and Bio equivalence (BABE) facilities and found some issues in such studies and filed a preliminary report. Further on 19th April 2016, USFDA issued untitled letter relating to the conduct of BABE business to the Company and released untitled letter to public on 20th April, 2016. Based on the letter issued by USFDA, the Company's business was severely damaged and the Company suspended some of its Business operations, till the allegations against the Company made by USFDA are resolved. It has severely damaged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive Director has resigned as Director of the Company on 13.06.2019 and was not involved in the day to day operations of the Company and (ii) Mr. Karnanda Nanaiah Bopanna, Director, has resigned from the Board of the Company on 12.12.2018. Hence they are not been made as party to this compounding application. (9) It is stated that the Violation is neither deliberate nor intentional and had occurred due to the reasons stated supra. The Company's business has been suspended and liquidated all its assets. 3. The Registrar of Companies, has filed his Report dated 18.03.2020 by inter alia contending as follows: (1) As per Section 96(1) of the Companies Act, 2013, Annual General Meeting for the financial year ended 31st March, 2017 and 31st March, 2018 ought to have been held on or before 30th September, 2017 and 30th September, 2018 respectively. But AGM for the financial year 2016-17 and 2017-18 were held on 18.01.2019 and 15.02.2019 respectively and thereby violated sub-section (1) of section 96 of Companies Act, 2013. The Details of Annual General Meeting held, as there was delay in conducting Annual General Meeting for aforesaid years: Financial Y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appointment: 08.03.2017): The total fine leviable: ₹ 32,55,000/- (Calculation as provided above. (e) For Petitioner No. 4 namely Mr. Sajan Podanolanda Chinnappa (Director) (Date of Appointment: 12.12.2018): Year Fine Leviable under 2013 Act Total Fine 2016-17 (12.12.2018 to 17.01.2019) ₹ 1,00,000/- (₹ 5000 X 37 days) = ₹ 2,85,000/- ₹ 2,85,000 2017-18 (12.12.2018 to 14.02.2019) ₹ 1,00,000/- (₹ 5000 X 65 days) = ₹ 4,25,000/- ₹ 4,25,000 TOTAL ₹ 7,10,000 (f) For officer in default during the relevant period namely Mr. Karnanda Nanaiah Bopanna, (Former Director) (Date of Appointment: 10.08.2016): Year Fine Leviable under 2013 Act Total Fine 2016-17 (01.10.2017 to 10.12.2018) ₹ 1,00,000/- (₹ 5000 X 436 days) = ₹ 22,80,000/- ₹ 22,80,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orily explained to Tribunal, the reasons for committing violations/offences in question, so as consider to impose minimum penalty. He is also justified to take a plea of present adverse economic situation arise due to pandemic. Therefore, we are inclined to take a lenient view of matter and thus want to impose minimum Compounding fine as mentioned below. 7. Since, Mr. Guru Veerappa Betageri, a non-resident, non-executive Director has resigned as Director of the Company on 13.06.2019 and was not involved in the day to day operations of the Company, and Mr. Karnanda Nanaiah Bopanna, Director, has also resigned from the Board of the Company on 12.12.2018, and the Company and the present Officers, have made good the offences/violations in questions, they are entitled for exemption from imposing fine. Hence they are hereby exempted from imposing fine in the instant case. 8. In the result, C.P. No. 73/BB/2020 is hereby disposed of by compounding the offence/violations committed by the Company and its Officers, with fine as mentioned below: (1) The Petitioner No. 1 M/s. Semler Research Center Private Limited is imposed with compounding fine as follows: i. For the year 2016-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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