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Tribunal fines defaulter Rs. 45,000 for non-filing cost audit report, directors to pay personally. The Tribunal imposed a fine of Rs. 45,000 on the defaulter for the financial year 2013-14 under sections 233B(11) of the Companies Act, 1956, for ...
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Tribunal fines defaulter Rs. 45,000 for non-filing cost audit report, directors to pay personally.
The Tribunal imposed a fine of Rs. 45,000 on the defaulter for the financial year 2013-14 under sections 233B(11) of the Companies Act, 1956, for non-filing of the cost audit report. The fine was to be paid within three weeks, with individual directors required to pay from personal accounts. Compliance with the fines within the specified timeframe would result in compounding of the offence, which was deemed to be committed due to oversight rather than malicious intent.
Issues: Compounding of default in compliance with the provisions of section 233B of the Companies Act, 1956 or under the provisions of section 148 of the Companies Act, 2013 for non-filing of the cost audit report.
Analysis: 1. The applicants filed a joint application for compounding of default for the years 2013-14 to 2015-16 under the relevant provisions. The Tribunal segregated the offences for administrative convenience based on a previous direction.
2. The petition was taken up following a judgment by the National Company Law Appellate Tribunal and considering the Companies (Amendment) Ordinance, 2018. The offence in question related to the year 2013-14, with specific fines outlined under section 233B(11) of the Companies Act, 1956.
3. The applicants claimed the default was inadvertent with no malicious intent, and the Registrar of Companies confirmed the default but noted that the company rectified the mistake and had no pending complaints or investigations.
4. The offence was deemed to be committed due to oversight, attracting fines as per section 233B(11). The Tribunal considered the applicants' plea, the Registrar's report, and relevant judgments in similar cases.
5. The Tribunal referred to section 621A of the Companies Act, 1956, empowering the Tribunal to compound such offences even if a prosecution is pending, especially under the changed law post-Companies (Amendment) Act, 2017.
6. A fine of Rs. 45,000 was imposed on the defaulter for the financial year 2013-14, with specific amounts allocated to individual directors. Upon payment of the fine within three weeks, the offence would be compounded, with directors required to pay from personal accounts.
7. The Tribunal disposed of the matter accordingly, emphasizing compliance with the imposed fines within the stipulated timeframe.
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