Tribunal Grants Compounding Application for Companies Act Violation

The Tribunal allowed the compounding application against the Registrar of Company, Mumbai for the violation of section 92 of the Companies Act, 2013. The Company rectified the default by filing the belated Annual Returns for the specified financial years, leading to the application being granted upon payment of the prescribed compounding fee and penalties. The Company and its officers were directed to pay penalties within 30 days, with specific amounts for each day of default, serving as a deterrent for future non-compliance. The Registrar of Companies was tasked with ensuring compliance and taking further actions as required.

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Issues involved:
Compounding application under section 441 of the Companies Act, 2013 against the Registrar of Company, Mumbai for violation of section 92 of the Companies Act, 2013 by failing to file copies of Annual Returns for specific financial years within the prescribed time.

Analysis:
The compounding application was filed against the Registrar of Company, Mumbai for the violation of section 92 of the Companies Act, 2013, regarding the failure to file Annual Returns for the Financial Years 2003-2004, 2004-2005, 2005-2006, and 2006-2007 within the specified timeframe. The applicants stated that the company conducted Annual General Meetings but failed to file the Annual Returns due to inadvertence and lack of professional guidance. They also mentioned the hindrance caused by the introduction of the MCA-21 Project in 2006, which affected their ability to file documents. The applicants took corrective actions by filing the necessary forms and fees to rectify the default. They argued that the non-compliance was unintentional and requested the application to be allowed with a minimum compounding fee.

The Tribunal examined the relevant sections of the Companies Act, 2013, specifically sections 92(4) and 92(5) which outline the requirements for filing Annual Returns and the associated penalties for non-compliance. It was noted that the Company eventually filed the Annual Returns for the specified financial years with the Registrar of Companies, thereby rectifying the default. After hearing the arguments, the Tribunal determined that the application deserved to be allowed since the default had been rectified by filing the belated Annual Returns for the mentioned years.

The Tribunal decided that the compounding application could be allowed upon payment of the prescribed compounding fee and penalty as per section 92(5) of the Companies Act, 2013. The Company and its officers were directed to pay the penalties, with specific amounts specified for each day of default. The imposed penalties were deemed sufficient to deter future non-compliance. The Company was instructed to make the required payments within 30 days of receiving the order. The Tribunal disposed of the Compounding Application based on the terms outlined, emphasizing that the offence would be compounded upon payment of the imposed fees. Compliance was to be reported, and the Registrar of Companies was tasked with taking further necessary actions as per the order.

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