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RD reduces penalty levied by ROC

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RD reduces penalty levied by ROC

Non-Appointment of CS attributable to poor monetary Situation: RD reduces penalty levied by ROC

The Regional Director, South East Area diminished penalty levied by ROC for Non-Appointment of CS attributable to poor monetary Situation.

The Official order Acknowledged:

That is an enchantment filed below part 454(5) of the Corporations Act, 2013 by the above appellants in e-form ADJ vide SRN F52450921 dated 09.12.2022 towards the adjudication order No. ROC(V)/ADJ (454)/SEC 203(5)/SBAPMPL/2022-23/2207 dated 09.09.2022 below part 454 handed by the Registrar of Corporations, Andhra Pradesh for default in compliance with the necessities of Part 203 learn with Rule 8A of the Corporations (Appointment and Remuneration of Managerial Personnel) Guidelines, 2014.

Registrar of Corporations in his order of adjudication has acknowledged that the corporate has did not appoint Firm Secretary for the reason that relevant provisions of the Act got here into pressure to until date regardless of paid up capital has exceeded the prescribed restrict as acknowledged within the provisions of Part 203(1) of the Corporations Act, 2013. Listening to was held earlier than Registrar of Corporations on 09.09.2022 and after listening to the approved consultant had levied a penalty of Rs.5.00 Lakhs on the Firm and Rs.50,000 every for two administrators i.e., Eluri Prasada Rao and Karupati Harikrishna (whole aggregating to Rs.6.00 Lakhs).

A chance of being heard was given to the Appellants on 27.03.2023. The approved consultant Mr. Uppalapati Satish, Training Firm Secretary appeared on behalf of the appellants and reiterated the submissions made within the enchantment submitting that the next causes:

(a) the corporate has availed secured mortgage of Rs.47,25,00,000 from IDBI Financial institution Restricted. On account of some unavoidable and surprising conditions it was unable to repay the instalments inside the scheduled compensation phrases accordingly it turned non- performing property to the banker. Consequently, enterprise operations of the corporate had been stalled from the monetary 12 months 2012-13 onwards and accordingly, firm has not earned any earnings.

(b) Firm has been incurring heavy losses from the previous a number of years i.e. from 2012-13 onwards and even earlier than the corporate has not earned any important income.

(c) Networth of the corporate is eroded. Consequently, enterprise operations of the corporate had been stalled from the monetary 12 months 2012-13 onwards and accordingly, the corporate has not earned any earnings. Promoters of the corporate not meant to restart enterprise actions attributable to unviable enterprise atmosphere.

(d) Firm and its promoters have been attempting laborious to settle all its statutory and different liabilities.

(e) Firm is just not ready to bear the price of remuneration payable to the Entire Time Firm Secretary preserving in view of the current monetary state of affairs of the corporate.

Although there’s a default dedicated, there’s a floor in interfering with the impugned adjudication order of Registrar of Corporations to the extent of decreasing the quantum of penalty because of the above causes as acknowledged by the approved consultant and penalty imposed by Registrar of Corporations is diminished by the then Regional Director, for the Firm to Rs.1,00,000 and for two administrators i.e., Eluri Prasada Rao and Karupati Harikrishna to Rs.50,000 every (whole aggregating to Rs. 2,00,000)

The appellants are directed to adjust to this order and likewise provisions of Part 454(8) of the Corporations Act, 2013 learn with Corporations (Adjudication of Penalties) Guidelines, 2014.

Accordingly, penalty was paid by the Firm amounting to Rs.1,00,000 and for two administrators i.e., Eluri Prasada Rao and Karupati Harikrishna to Rs.50,000 every (whole aggregating to Rs.2,00,000) vide SRN’s X59625962, X59626937 and X59625970 dated 28.11.2023 respectively. Accordingly, this order is issued to the Appellants with a duplicate to Registrar of Corporations, Andhra Pradesh and Joint Secretary, E-Governance Cell, Ministry of Company Affairs, New Delhi for data and obligatory motion.

For Official Order Obtain the PDF Given Under:

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