NON-APPOINTMENT OF COMPANY SECRETARY -WADHWAGROUP HOLDINGS LIMITED WAS FINED RS 30 LACS BY NCLT AND AGAIN RS 15 LACS BY ROC MUMBAI FOR THE SIMILAR OFFENCE
ROC MUMBAI Vs WADHWAGROUP HOLDINGS LIMITED
FACTS OF THE CASE
WadhwaGroup Holdings Limited was
penalized by the Registrar of Companies, Mumbai for non-compliance relating to
the appointment of a Company Secretary.
The company was reportedly fined
₹30 lakh and subsequently ₹15 lakh for a similar offence. The case also raises
an important compliance issue concerning the availability of reduced penalty
treatment for a “small company as the company is not a small company.
CASE SEQUENCE
Prasad Ramesh Khopkar, the
company's whole-time Company Secretary, resigned effective 31.05.2020. Under Section
203(4), the resulting vacancy had to be filled by the Board within six months —
by 01.12.2020.
Company moved NCLT and NCLT levied
a compounding fee of Rs 30 lacs.
Instead, the company appointed
Tejal Anil Bhosle as the next whole-time CS only with effect from 05.02.2025, a
delay of 1,527 days.
SUO-MOTO WITH ROC AND ROC LEVIED A FINE OF RS 15 LACS
For the delay of 1,527 days , Company came forward suo-moto
under Section 454, admitting the 1,527-day delay was inadvertent and
unintentional, with no mala fide intent.
KEY COMPLIANCE POINT:
Failure to appoint a Company
Secretary when legally required can result in substantial monetary penalties
for the company and officers in default.
"Inadvertent and unintentional" carries little weight once a company has already been through compounding for the same class of default. Section 203(4)'s stipulates that company secretary vacancy is to be filled within six-month
# R V SECKAR , Your compliance
expert 79047 19295,
