Background and Order:
The Registrar of Companies, Coimbatore (“RoC”), by way of its order dated November 5, 2024, in the matter of XIE Futec Automation Private Limited (“Company”), has held that the non-filing of annual returns and annual financial statements by the Company with the RoC is an offence of serious nature since the ramifications of this are adverse as it results in keeping information about a company out of reach of stakeholders, regulatory authorities and others who have interest in the company.
In the instant case, a notice was issued to the Company and its directors for non-filing of annual returns and financial statements under sections 92 and 137 of the Companies Act, 2013 (“Act”). The Company failed to reply to the notices and the adjudicating officer recognised that non-filing of statutory return is not only a violation of the provisions of the Act but also a denial of information to various stakeholders and public in general.
Given the criticality of these filings and the fact that the annual returns and annual financials were not filed for 4 consecutive years, the adjudicating officer imposed a penalty of INR 18.63 lacs on the Company and the officers in default (being the whole-time directors and the managing director).
Key Takeaways:
The order reaffirms the recent RoC trend of closely monitoring non-compliances and the onus on whole-time / managing directors to ensure that compliances under the Act are undertaken in a timely and accurate manner.
Furthermore, the order takes an intriguing view on the non-filing of annual returns and financial statements as not merely being non-compliances under the Act, but actions that result in non-availability of critical information about a company before its stakeholders, regulatory authorities and other interested parties.
