TMI Blog2020 (8) TMI 581X X X X Extracts X X X X X X X X Extracts X X X X ..... he acted in conscious disregard of its obligation. The Tribunal failed to notice the minimum fine prescribed under Sub-Section 6 of Section 165 of the Act, which was applicable at relevant time i.e. before the amendment - In view of the error apparent in the impugned order dated 03.04.2018 passed by the Tribunal, thus, the order cannot be upheld. The Respondent has contravened the provisions of 165(1) of the Act, which is punishable under Sub-Section 6 of Section 165 of the Act. Taking into consideration, the facts and circumstances of the case, we imposed minimum fine at the rate of five thousand rupees for every day for the period 01.04.2015 to 21.02.2016 i.e. 272 days. We quantified penalty to ₹ 13,60,000/-. The Respondent has already paid ₹ 50,000/- after adjustment, now he is liable to pay ₹ 13,10,000/-. Therefore, The Respondent is directed to pay such amount within a period of 60 days in National Company Law Tribunal, Kolkata. Appeal allowed. - Company Appeal (AT) No. 13 of 2019 - - - Dated:- 24-6-2020 - Justice Jarat Kumar Jain) Member (Judicial) , (Balvinder Singh) Member (Technical) And (Dr. Ashok Kumar Mishra) Member (Technical) For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Company Prosecutor submits that the compounding fees under Section 441 (1) of the Act should be minimum amount which is prescribed for the offence as held by this Tribunal, in the case of Company Appeal (AT) No. 249 of 2018 Registrar of Companies cum Official Liquidator, Rajasthan, Jaipur Vs Gyan Chandra Agarwal decided on 12.09.2018. The Appellant has contravened the provisions of Section 165(1) read with Section 165(3) of the Act, for a period of 272 days. Therefore, as per the provisions of Section 165 (6) of the Act, he is liable for minimum fine prescribed for the violation i.e. ₹ 5000/- per day which comes to 13,60,000/-. Whereas Ld. Tribunal has imposed compounding fees ₹ 50,000/- which is less than the minimum prescribed in Section 165 (6) of the Act. Hence, the Appeal be allowed and Respondent be directed to pay minimum compounding fees. 8. On the other hand, Learned Counsel for the Respondent opposes the prayer and submits that the Respondent s resignation was received by the Company on 14.10.2014 i.e., within a period of one year from the date on which Section 165 (1) of the Act, came into force i.e. 01.0.2014 and hence, the Respondent has not contraven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shment prescribed for such offence, such as fine or imprisonment or both fine and imprisonment. (iv) The report of the Registrar of Companies. (v) The period of default. (vi) Whether petition for compounding is suo moto before or after notice from Registrar of Companies or after imposition of the punishment or during the pendency of a proceeding. (vii) The defaulter has made good of the default. (viii) Financial condition of the company and other defaulters. (ix) Offence is continuous or one time. (x) Similar offence earlier committed or not. (xi) The act of defaulters is prejudicial to the interest of the member(s) or company of public interest or not. (xii) Share value of the company, etc. 13. Admittedly, in this case, the Respondent has violated the provisions under Section 165(1) read with Section 165(3) of the Act, for a period 01.04.2015 to 28.12.2015 which is punishable under Section 165(6) of the Act, (before amendment) which reads as under:- (6) if a person accepts and appointment as a director in contravention of sub-section 1, he shall be punishable with fine which shall be less than five thousand rupees bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess than minimum which is prescribed for the offence. 17. The issue for consideration is, whether Tribunal can impose the compounding fees under Section 441 (1) of the Act, less than minimum prescribed for the offence under Section 165 (1) read with Section 165(6). 18. This Appellate Tribunal in the case of Registrar of Companies cum Liquidator, Rajasthan, Jaipur (Supra) held as under: - 2. Learned Company Prosecutor appearing on behalf of the Registrar of Companies, Jaipur referred to sub-section (6) of Section 165 of the Companies Act, 2013, which reads as follows:- 165(6). If a person accepts an appointment as a director in contravention of sub-section (1), he shall be punishable with fine which shall not be less than five thousand rupees but which may extend to twenty-five thousand rupees for every day after the first during which the contravention continues. 3. It is submitted that though the Tribunal had noticed the aforesaid provision and the punishment attributed for the default pursuant to the provision but notwithstanding the minimum quantum of fine imposed, the impugned order has been passed. 4. Mr. Suresh Sharma, Practicing Company Secreta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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