ROC Penalizes Company for Undelivered Authority Letter, Sec 12 CA 2013

ROC Penalizes Company for Undelivered Authority Letter, Sec 12 CA 2013. In this article we will take you through the mandatory provisions under Section 12 of the companies Act, 2013 which mandates every company to  paint or affix its name, and the address of its registered office, and keep the same painted or affixed, on the outside of every office or place in which its business is carried on, in a conspicuous position, in legible letters, and if the characters employed therefor are not those of the language or of one of the languages in general use in that locality, also in the characters of that language or of one of those languages
Applicable Provision:
The violation pertains to Section 12(3)(c) and (d), which mandates that every registered company must have its name and Corporate Identity Number (CIN) printed on business letters, billheads, and official publications. Additionally, non-compliance with this requirement attracts penalties under Section 12(8) of the Companies Act, 2013.
Facts of the Case:
ROC Order:
The notice issued by IEP Authority was returned back undelivered by the postal Authority, this leads to raising the presumption that the registered office of the company was not duly maintained as required under Section 12 of the Companies Act, 2013. Consequently, a show cause notice under Section 454(5) for violation of Section 12 was subsequently issued to the company and its directors/officers as per the addresses available on the MCA Portal. No response was received by the ROC to the SCN from the  company and its directors/officers in default.
The Registrar of Companies (ROC), Mumbai, upon review of the case, issued an order confirming that the company was in violation of Section 12(3)(c) and (d) of the Companies Act, 2013.
Company filed an appeal stated that the appellant has suffered from severe financial loss and burden and hence could not repay the dues to the state bank of India and due to this SBI had taken over the symbolic possession of the registered office of the company.
Appellants Company further contended that company is not in a position to engage employees in order to run the company efficiently because of which notice which was sent to the company at its registered office was returned undelivered by the postal authorities. That the company wind up but could not do so due to scarcity of funds.
Penalty Imposed
Upon examination, the Adjudicating Officer of the Registrar of Companies (ROC), Mumbai, levied a penalty on the Company and its officers in default as follows:

Violation of Section

Penalty Imposed on the company

Penalty as per section 42 of the Act

Section 12 of the companies Act 2013

Company

1 Lakh

Director

1,00,000 each 4 directors

Reduction in Penalty
Upon representation and considering the submissions made by the company, the Regional Director (Western Region), Mumbai, issue notice of hearing to the appellant company as on 07.12.2020 by speed post as well by mail and fixed the hearing on 23.12.2020. the notice sent by speed post remain undelivered with remark “LEFT”. However notice sent by mail has been delivered to the appellants mail address, but none appeared from appellants before the forum at the time o hearing.
Accordingly, RD stated that appellants is not interested to pursue the appeal filed before this forum, hence the appeal is rejected. The ROC, Mumbai is directed to take necessary action as per provisions of the Act.
Conclusion
In light of the above, it is evident that the company failed to comply with the mandatory provisions under Section 12 of the Companies Act, 2013, resulting in penalties being imposed on the company and its directors. Despite financial distress and operational difficulties cited by the appellants, their failure to maintain a duly registered office and respond to official communications led to the presumption of non-compliance. Moreover, the company’s absence during the appeal proceedings further indicated a lack of interest in pursuing the matter. Consequently, the appeal was rejected, and the ROC, Mumbai, was directed to take necessary action as per the provisions of the Act. This case underscores the critical importance of maintaining a registered office and ensuring adherence to statutory requirements to avoid regulatory consequences.
Download MCA Adjudication Order

In this article we will take you through the mandatory provisions under Section 12 of the companies Act, 2013 which mandates every company to paint or affix its name, and the address of its registered office, and keep the same painted or affixed, on the outside of every office or place in which its business is carried on, in a conspicuous position, in legible letters, and if the characters employed therefor are not those of the language or of one of the languages in general use in that locality, also in the characters of that language or of one of those languages

Applicable Provision:

The violation pertains to Section 12(3)(c) and (d), which mandates that every registered company must have its name and Corporate Identity Number (CIN) printed on business letters, billheads, and official publications. Additionally, non-compliance with this requirement attracts penalties under Section 12(8) of the Companies Act, 2013.

Facts of the Case:

ROC Order:

The notice issued by IEP Authority was returned back undelivered by the postal Authority, this leads to raising the presumption that the registered office of the company was not duly maintained as required under Section 12 of the Companies Act, 2013. Consequently, a show cause notice under Section 454(5) for violation of Section 12 was subsequently issued to the company and its directors/officers as per the addresses available on the MCA Portal. No response was received by the ROC to the SCN from the company and its directors/officers in default.

The Registrar of Companies (ROC), Mumbai, upon review of the case, issued an order confirming that the company was in violation of Section 12(3)(c) and (d) of the Companies Act, 2013.

Company filed an appeal stated that the appellant has suffered from severe financial loss and burden and hence could not repay the dues to the state bank of India and due to this SBI had taken over the symbolic possession of the registered office of the company.

Appellants Company further contended that company is not in a position to engage employees in order to run the company efficiently because of which notice which was sent to the company at its registered office was returned undelivered by the postal authorities. That the company wind up but could not do so due to scarcity of funds.

Penalty Imposed

Upon examination, the Adjudicating Officer of the Registrar of Companies (ROC), Mumbai, levied a penalty on the Company and its officers in default as follows:

Violation of Section	Penalty Imposed on the company	Penalty as per section 42 of the Act
Section 12 of the companies Act 2013	Company	1 Lakh
Section 12 of the companies Act 2013	Director	1,00,000 each 4 directors

Reduction in Penalty

Upon representation and considering the submissions made by the company, the Regional Director (Western Region), Mumbai, issue notice of hearing to the appellant company as on 07.12.2020 by speed post as well by mail and fixed the hearing on 23.12.2020. the notice sent by speed post remain undelivered with remark “LEFT”. However notice sent by mail has been delivered to the appellants mail address, but none appeared from appellants before the forum at the time o hearing.

Accordingly, RD stated that appellants is not interested to pursue the appeal filed before this forum, hence the appeal is rejected. The ROC, Mumbai is directed to take necessary action as per provisions of the Act.

Conclusion

In light of the above, it is evident that the company failed to comply with the mandatory provisions under Section 12 of the Companies Act, 2013, resulting in penalties being imposed on the company and its directors. Despite financial distress and operational difficulties cited by the appellants, their failure to maintain a duly registered office and respond to official communications led to the presumption of non-compliance. Moreover, the company’s absence during the appeal proceedings further indicated a lack of interest in pursuing the matter. Consequently, the appeal was rejected, and the ROC, Mumbai, was directed to take necessary action as per the provisions of the Act. This case underscores the critical importance of maintaining a registered office and ensuring adherence to statutory requirements to avoid regulatory consequences.