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Showing posts with label governance literacy. Show all posts
Showing posts with label governance literacy. Show all posts

Friday, June 23, 2023

Awareness Program on Directors Liability under the Companies Act, 2013 and other laws applicable to limited liability companies

1)     Why all this?

 

Directors are involved in directing, managing and controlling a private & public limited company and hence is expected to be aware of their duties & liabilities.

This session will educate the directors to ask the right questions and do business, which is legal and ethical.

You may soon expect Income Tax like raids from the Registrar of Companies (ROC), as they are implementing artificial intelligence tools to track non-compliances and impose penalties.

2)     Non-compliance & its implications:

A Company has not been mentioning the Corporate Identification Number (CIN) and the registered office address in the company's letterheads and also in various documents and communications (first such incidence of violation pointed out was on 02nd May 2017).

The ROC relied on 8 documents/letters sent by the company (like Invoices & reply letter to ROC) and determined that there was a violation of Section 12(3)(c) of the Companies Act, 2013 committed by the company from 2nd May 2017 to 22nd August 2022 i.e., for a duration of 1939 days delay.

ROC then levied a daily penalty of Rs. 1000/- on the Company and each of its 3 directors, for 1939 days of delay. The maximum penalty for company is limited to Rs. 2 lakhs whereas it is Rs. 1 lakh for every director.

Totalling all this, Rs.5,00,000/- was the penalty imposed on the company and its directors for not mentioning the address of the registered office and CIN on letterhead.

 

3)     What will you get?

 

A Dossier for Diligent Directors to stay immune from penalties imposed by ROC through adjudication orders will be given.

CS Updatin...

See Yes -> Yes, ACS

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