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Penalty under Companies Act 2013

Today we are discussing on Penalty under Companies Act 2013. In this blog we will discuss cases where penalty can be imposed under companies act 2013 and amount of penalty also we will discuss who is liable for the penalty as per companies act 2013.

Penalty under Companies Act 2013

Cases where penalty can be imposed under Companies Act 2013

Section

Particulars

Who is liable

Amount of penalty

4(5)(ii) Furnishing wrong or incorrect information while applying for reservation of name Person making application UptoRs.1 lac
11(2) Commencing business without submitting declaration about having minimum share capital Company UptoRs.5,000/ –
12(8) Default in complying with provisions relating to intimation and display of registered office of company and display of name of company Company and every officer who is in
default
Rs.1,000/ – per day (M ax.1 lac)
15(2) Default in noting of alteration in
M emorandum & Articles in every copy of memorandum and Articles
–do– Rs.1,000/ –
(for every copy of M emorandum or Articles)
17(2) Default in sending copies of memorandum & articles to a member within 7 days on
payment of fees
–do– Rs.1,000/ – per day of default or Rs.1 lac, whichever is less
33(3) Issuing application forms for securities without abridged prospectus, and not sending full
prospectus on request
Company Rs.50,000/ – for each default
39(5) Not refunding allotment money within 30 days if minimum subscription not received and not
filing return of allotment within 30 days
Company and every officer who is in
default
Rs.1,000/ – per day of default or Rs.1 lac, whichever is less
42(10) Default in provisions relating to private placement of securities Company, promoters and directors Upto amount involved in offer or invitation or Rs.2
crores, whichever is higher.
60(2) Default in provision relating to publication of authorized capital alongwith subscribed and paid up capital Company Rs.10,000/ – for each default
Officer in default Rs.5,000/ – for each default
91(2) Default in provision relating to closure of
register of members and debenture holders
Company and every officer who is in
default
Rs.5,000/ – per day (M ax.1 lac) during which register is closed.
94(4) Default in keeping register of members and copies of annual returns at registered office and allowing its inspection Company and every officer who is in
default
Rs.1,000/ – per day (M ax. Rs.1 lac) for each default
111(5) Default in circulation of members resolution Company and every officer who is in
default
Rs.25,000/ –
118(11) Default  in provisions relating to maintenance Company Rs.25,000/ –
of minutes of general meetings and Board meetings Officer who is in default Rs.5,000/ –
119(3) Default in allowing inspection of minutes of general meeting or resolution passed by postal ballot Company Rs.25,000/ –
Officer who is in default Rs.5,000/ –
136(3) Default in sending copies of audited financial statement to members and its inspection Company Rs.25,000/ –
Officer who is in default Rs.5,000/ –
173(4) Default in giving required notice of Board meeting Every person whose duty is Rs.25,000/ –
189(6) Default in keeping register of  contracts or arrangements in which directors are
interested and disclosure by directors of their interest
Every director Rs.25,000/ –
190(3) Default in keeping contract of service with M D and WTD and allowing its inspection Company Rs.25,000/ – for each default
Officer who is in default Rs.5,000/ – for each default
352(8)(a) Company Liquidator retaining money without depositing it in Company Liquidation Dividend and Undistributed Assets Account Liquidator Such amount as may be determined by ROC.
Note:
Concept of levy of penalties by adjudicating officers has been introduced for the first t ime in company
law  in Companies Act  2013.   As per Companies (Adjudication of  Penalties) Rules 2014 adjudicating
officers (not below the rank of Registrar) can levy penalty after issuing show cause notice and hearing in person, if required. Appeal against such order can be f iled with the Regional Director.
It may be noted that penalty is different from fine.  Only Special Court can take cognizance of offence under the Act and can order for fine/ imprisonment.

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