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TMI Blog2022 (4) TMI 883X X X X Extracts X X X X X X X X Extracts X X X X ..... lution Professional under Section 19(2) of the Code seeking direction to the suspended directors / the Appellants herein to cooperate and provide signed copy of the financial statements for the Financial Year of 2019-2020, observing as follows: "6. Since CIRP/Liquidation is to be completed in time bound manner, the AA cannot grant time to file Reply/Replies to various IAs filed by aggrieved parties during the process of CIRP. It is settled position of law that in terms of provisions of Section 19 of Code, the personnel of CD, its promoters or any other person associated with the management of CD shall extend all assistance and co-operation to IRP as may be required by him, in managing the affairs of CD. Therefore, in order to avoid further delay, it would be just and proper to direct the Respondents to extend the requisite co-operation to the Applicant in discharge of his functions including to provide signed copy of Financial Statements for the FY of 2019-20. 7. In the result, IA-2070(PB)/2021 in CP No. (IB)-933(PB)/2019 is hereby disposed by directing the Respondents to cooperate and provide signed copy of the financial statements for FY of 2019-2020, within a period two week ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GNL-2, IRP/RP/Liquidator will choose radio button "Filings under IBC". 5. It is the case of the Appellants that in view of the circular, it is the RP who should sign the Form in the capacity of CEO in order to meet the filing protocol and further it is not the suspended director who has to sign the Financial Statement for the Year 2019-20. 6. Learned Counsel for the Respondent / RP strenuously contended that despite repeated requests, the Appellants did not co-operate in signing the Financial Statement and therefore, he was constrained to file I.A. No. 2070(PB)/2021 before the Adjudicating Authority seeking direction to them to co-operate. It is further submitted that the RP got Books of Accounts prepared for the Financial Year 2019-20 and accordingly M/s R.N. Marwah & Co. LLP, Charter Accountant were appointed as statutory auditor of the Corporate Debtor way back on 2017 itself and the same Auditor had prepared the statements. The draft Financial Statement and draft audit report for the financial year 2019-20 received from the auditor was sent to the Appellants vide email dated 12.02.2021, to review the accounts and signed the same in order to enable the RP to file it before th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds notified under section 133 and shall be in the form or forms as may be provided for different class or classes of companies in Schedule III: Provided that the items contained in such financial statements shall be in accordance with the accounting standards: Provided further that nothing contained in this sub-section shall apply to any insurance or banking company or any company engaged in the generation or supply of electricity, or to any other class of company for which a form of financial statement has been specified in or under the Act governing such class of company: Provided also that the financial statements shall not be treated as not disclosing a true and fair view of the state of affairs of the company, merely by reason of the fact that they do not disclose-- (a) in the case of an insurance company, any matters which are not required to be disclosed by the Insurance Act, 1938, or the Insurance Regulatory and Development Authority Act, 1999; (b) in the case of a banking company, any matters which are not required to be disclosed by the Banking Regulation Act, 1949; (c) in the case of a company engaged in the generation or supply of electricity, any mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... venes the provisions of this section, the managing director, the whole-time director in charge of finance, the Chief Financial Officer or any other person charged by the Board with the duty of complying with the requirements of this section and in the absence of any of the officers mentioned above, all the directors shall be punishable with imprisonment for a term which may extend to one year or with fine which shall not be less than fifty thousand rupees but which may extend to five lakh rupees, or with both. Explanation.-For the purposes of this section, except where the context otherwise requires, any reference to the financial statement shall include any notes annexed to or forming part of such financial statement, giving information required to be given and allowed to be given in the form of such notes under this Act. Section 134. Financial statement, Board's report, etc 1. The financial statement, including consolidated financial statement, if any, shall be approved by the Board of Directors before they are signed on behalf of the Board by the chairperson of the company where he is authorised by the Board or by two directors out of which one shall be managing director, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , which in the opinion of the Board may threaten the existence of the company; (o) the details about the policy developed and implemented by the company on corporate social responsibility initiatives taken during the year; (p) in case of a listed company and every other public company having such paid-up share capital as may be prescribed, a statement indicating the manner in which for malannual evaluation of the performance of the Board, its Committees and of individual directors has been made; (q) such other matters as may be prescribed. Provided that where disclosures referred to in this sub-section have been included in the financial statements, such disclosures shall be referred to instead of being repeated in the Board's report: Provided further that where the policy referred to in clause (e) or clause (o) is made available on company's website, if any, it shall be sufficient compliance of the requirements under such clauses if the salient features of the policy and any change therein are specified in brief in the Board's report and the web-address is indicated therein at which the complete policy is available. Provided that in case of a Specified IFSC public comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e accounting records, and the timely preparation of reliable financial information; (f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. (6) The Board's report and any annexures thereto under sub-section (3) shall be signed by its chairperson of the company if he is authorised by the Board and where he is not so authorised, shall be signed by at least two directors, one of whom shall be a managing director, or by the director where there is one director. (7) A signed copy of every financial statement, including consolidated financial statement, if any, shall be issued, circulated or published along with a copy each of- (a) any notes annexed to or forming part of such financial statement; (b) the auditor's report; and (c) the Board's report referred to in sub-section (3). (8) If a company is in default in complying with the provisions of this section, the company shall be liable to a penalty of three lakh rupees and every officer of the company who is in default shall be liable to a penalty of fifty thousand rupees." 10. The submissions of the Learned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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