RD LEVIED A FINE OF ₹63,90,000 ON HINDUSTAN ZINC LIMITED (VEDANTA GROUP) FOR NOT MENTIONING THE DIRECTOR IDENTIFICATION NUMBERS (DIN) IN THE FINANCIALS FOR THE FINANCIAL YEARS 2014-15 to 2020-21.

RD LEVIED A FINE OF ₹63,90,000 ON

 HINDUSTAN ZINC LIMITED (VEDANTA

 GROUP) FOR NOT MENTIONING THE

 DIRECTOR IDENTIFICATION NUMBERS

 (DIN) IN THE FINANCIALS FOR THE

 FINANCIAL YEARS 2014-15 to 2020-21.

REGIONAL DIRECTOR, NORTH WESTERN REGION , MCA Vs HINDUSTAN ZINC LIMITED (VEDANTA GROUP)

 

LEGAL PROVISION

SECTION 158 OF THE COMPANIES ACT, 2013

Mandates that every person or company must mention the DIN of directors in all returns, information, and documents, including financial statements filed with MCA.

However, Hindustan Zinc Limited failed to mention the Director Identification Number (DIN) of its directors in the financial statements.

WHY IT IS CONSIDERED AS AN OFFENCE?

DINs of directors were omitted in the financial statements, which is a statutory disclosure requirement

Such omission affects transparency and traceability of directors’ accountability.

COMPOUNDING APPLICATION

The company filed an application under Section 441 of the Companies Act, 2013.

On payment of the compounding amount, the offence stood compounded, and no further prosecution was pursued by RD.

KEY LEARNINGS

·      DIN disclosure is not a procedural formality—it is a mandatory statutory requirement

·      Even large, listed companies are not spared from strict enforcement

·      Financial statements are considered “documents” under Section 158

·      Compounding may avoid prosecution, but financial and reputational costs remain high

LESSONS LEARNED

This case study shows failure of compliance in a listed company.

How Compliance officer , Statutory Auditors overlooked in this issue is perplexing.

Disclosure lapses in financial statements—even technical ones—can lead to multi-crore consequences.

Robust internal review mechanisms are essential before finalisation and signing of financials.

CAN WE APPEAL AGAINST THE RD ORDER ?

if you are aggrieved by the Regional Director's own order, there isn't a further judicial appeal to NCLT/NCLAT directly under current law for these specific administrative penalties, though proposals exist; however, the RD can modify or set aside their own order upon hearing, so the appeal process is primarily administrative, with the RD acting as the appellate authority over the ROC.

R V SECKAR , FCS, LLB, 79047 19295