Is it mandatory to have a company secretary for a Public Company?

Is it mandatory to have a company secretary for a Public Company?. A listed company failing to appoint a Company Secretary is considered a serious violation under the Companies Act, 2013, leading to penalties for the company and its directors, as the Company Secretary is classified as a Key Managerial Personnel (KMP) and their appointment is mandatory for listed companies, non-compliance can result in fines ranging from one lakh to five lakh rupees for the company.
As per section 203 of the companies Act the appointment of KMP must be made by a resolution of the Board of Directors, and any vacancy in these positions must be filled within six months from the date of such vacancy to maintain smooth corporate functioning. Additionally, the section restricts a whole-time KMP from holding a similar position in more than one company, except in its subsidiary company, ensuring that key managerial personnel dedicate their efforts effectively to their respective organizations.
Applicable Provisions
The MCA adjudication order involves an appeal under Section 454(5) of the Companies Act, 2013, concerning the adjudication of penalties. The relevant rules include the Companies (Adjudication of Penalties) Rules, 2014. The matter was brought before the Regional Director (ER), Kolkata, for consideration.
Facts of the Case with ROC and RD
In Ascu Arch Timber Protection Limited, concerned ROC had issued adjudication notice for violation of section 203 (1) of the companies Act dated 23.06.2022 to the company and its officers. In this regard, no adequate reply to the notice has been received from the company and its officers in default as to why penalty shall not be imposed.
Considering the fact and circumstances of the case, Registrar of Companies (ROC) imposed penalties for non-compliance, leading the company to file an appeal before the Regional Director (RD) and an opportunity of being heard was given by the RD to appellants on 01/02/2024. The authorised representative submitted:

A reference letter issued by the Calcutta Stock Exchange Limited to the appellant Company stating the fact that the said company is suspended from the records of exchange w.e.f April 2023.

Apart from above points no cogent reason was pointed out for interference with regard to the order of Adjudicating Authority imposing penalties on the company and other officers in default.

As authorised representative had no valid submissions in this regard requiring interference with the order of ROC. Hence the order of ROC is confirmed as no cogent ground was made out by the appellant.
Imposed Penalty
Considering all the facts, circumstances and all the submission made by the company, the adjudicating authority had imposed penalty on companies and officers in default as follows:

Violation of Section

Period of default

To whom penalty imposed

Maximum Penalty

Section 203(4) r/w 203 (5) of the companies Act 2013

795

On Company

5,00,000

795

On 1st Director

5,00,000

795

On 2nd Director

5,00,000

795

On 3rd Director

5,00,000

Confirming ROC Order
The appeal was heard on 01/02/2024 Authorised Representative was asked to make submissions regarding any infirmity in order of ROC. The Authorised Representative had no valid submissions in this regard. Hence the order of ROC is confirmed as no cogent ground was made out by the authorised representative.
Further RD directed that the amount shall be paid within a period of 90 days from the date pf receipt of the copy of the order. In the company and its directors fail to deposit the penalty amount within the prescribed time limit action under section 454 (8)(i) and (ii) of the companies Act 2013 shall be initiated against the company and its directors.
Any Benefit of Section 446B of Companies Act
Section 446B of the Companies Act, 2013 provides a significant relief mechanism for small companies and start-ups by reducing the penalty burden for certain non-compliances. Under this provision, if a small company or a start-up commits a default for which a penalty is prescribed under the Act, the penalty imposed for LLP, OPC shall not be more than half of the specified penalty, subject to a maximum limit. In adjudication matter of Ascu Arch Timber Protection Limited being a public company does not fall under the criteria of section 446B of the companies Act 2013.
Findings:
In conclusion, the appeal under Section 454(5) of the Companies Act, 2013, was carefully examined by the Regional Director and considering all the fact and circumstances RD confirm the order of ROC as RD did not get any cogent ground. 
This demonstrates that company initially should be complaint in each and every term and in case of appeal to the RD it became very significant to make valid points to mitigate the penalty.
Download MCA Adjudication Order

A listed company failing to appoint a Company Secretary is considered a serious violation under the Companies Act, 2013, leading to penalties for the company and its directors, as the Company Secretary is classified as a Key Managerial Personnel (KMP) and their appointment is mandatory for listed companies, non-compliance can result in fines ranging from one lakh to five lakh rupees for the company.

As per section 203 of the companies Act the appointment of KMP must be made by a resolution of the Board of Directors, and any vacancy in these positions must be filled within six months from the date of such vacancy to maintain smooth corporate functioning. Additionally, the section restricts a whole-time KMP from holding a similar position in more than one company, except in its subsidiary company, ensuring that key managerial personnel dedicate their efforts effectively to their respective organizations.

Applicable Provisions

The MCA adjudication order involves an appeal under Section 454(5) of the Companies Act, 2013, concerning the adjudication of penalties. The relevant rules include the Companies (Adjudication of Penalties) Rules, 2014. The matter was brought before the Regional Director (ER), Kolkata, for consideration.

Facts of the Case with ROC and RD

In Ascu Arch Timber Protection Limited, concerned ROC had issued adjudication notice for violation of section 203 (1) of the companies Act dated 23.06.2022 to the company and its officers. In this regard, no adequate reply to the notice has been received from the company and its officers in default as to why penalty shall not be imposed.

Considering the fact and circumstances of the case, Registrar of Companies (ROC) imposed penalties for non-compliance, leading the company to file an appeal before the Regional Director (RD) and an opportunity of being heard was given by the RD to appellants on 01/02/2024. The authorised representative submitted:

A reference letter issued by the Calcutta Stock Exchange Limited to the appellant Company stating the fact that the said company is suspended from the records of exchange w.e.f April 2023.
Apart from above points no cogent reason was pointed out for interference with regard to the order of Adjudicating Authority imposing penalties on the company and other officers in default.

Imposed Penalty

Considering all the facts, circumstances and all the submission made by the company, the adjudicating authority had imposed penalty on companies and officers in default as follows:

Violation of Section	Period of default	To whom penalty imposed	Maximum Penalty
Section 203(4) r/w 203 (5) of the companies Act 2013	795	On Company	5,00,000
	795	On 1st Director	5,00,000
	795	On 2nd Director	5,00,000
	795	On 3rd Director	5,00,000

Confirming ROC Order

The appeal was heard on 01/02/2024 Authorised Representative was asked to make submissions regarding any infirmity in order of ROC. The Authorised Representative had no valid submissions in this regard. Hence the order of ROC is confirmed as no cogent ground was made out by the authorised representative.

Further RD directed that the amount shall be paid within a period of 90 days from the date pf receipt of the copy of the order. In the company and its directors fail to deposit the penalty amount within the prescribed time limit action under section 454 (8)(i) and (ii) of the companies Act 2013 shall be initiated against the company and its directors.

Any Benefit of Section 446B of Companies Act

Section 446B of the Companies Act, 2013 provides a significant relief mechanism for small companies and start-ups by reducing the penalty burden for certain non-compliances. Under this provision, if a small company or a start-up commits a default for which a penalty is prescribed under the Act, the penalty imposed for LLP, OPC shall not be more than half of the specified penalty, subject to a maximum limit. In adjudication matter of Ascu Arch Timber Protection Limited being a public company does not fall under the criteria of section 446B of the companies Act 2013.

Findings:

In conclusion, the appeal under Section 454(5) of the Companies Act, 2013, was carefully examined by the Regional Director and considering all the fact and circumstances RD confirm the order of ROC as RD did not get any cogent ground.

This demonstrates that company initially should be complaint in each and every term and in case of appeal to the RD it became very significant to make valid points to mitigate the penalty.