TMI BlogClarification on prosecutions filed or internal adjudication proceedings initiated against Independent Directors, non-promoters and non-KMP non-executive directorsX X X X Extracts X X X X X X X X Extracts X X X X ..... Dr. R.P. Road, New Delhi Dated: 2 nd March, 2020 To, All Regional Directors, All Registrars of Companies, All Official Liquidators. Subject: Clarification on prosecutions filed or internal adjudication proceedings initiated against Independent Directors, non-promoters and non-KMP non-executive directors - reg. Sir, Under several provisions of the Companies Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bution of accounts or records is submitted in e-form GNL-3 by a person under the immediate authority of the Board or any KMP, the liability of such person will arise. However, in certain cases, the penal provisions in the Act hold a specific director, or officer, or any other person accountable for the default, in such cases, action should be initiated only against such director, or officer, or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NEDs, would exist in the following cases: a) Directors nominated by the Government on the public sector undertakings; b) Directors nominated by Public Sector Financial Institutions, Financial Institutions or Banks having participation in equity of a company, or otherwise; c) Directors appointed in pursuance to any statutory or regulatory requirement such as directors appointed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he concerned officers of the company. In case, lapses are attributable to the decisions taken by the Board or its Committees, all care must be taken to ensure that civil or criminal proceedings are not unnecessarily initiated against the IDs or the NEDs, unless sufficient evidence exists to the contrary. 6. The records available in the office of the Registrar, including e-forms DIR-11 or DI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led but the above mentioned cases criteria is not satisfied, the same may be submitted to this Ministry for necessary examination and further direction thereon. 9. This issues with the approval of the competent authority. Yours faithfully, (Parvez Naikwadi) Assistant Director Legal Prosecution - Circular - Trade Notice - Public Notice - Instructions - Office orders Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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