PAS-3 PENALTY


 

Company Penalized for Non-Filing of Form PAS-3

Facts of the Case:

🔹 The Registrar of Companies (ROC), Tamil Nadu, issued an adjudication order against Kalpakkam Nidhi Limited (CIN: U65991TN1994PLC029165) for non-compliance with Rule 14(6) of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

🔹 Regulatory Requirement (Rule 14(6)):
A company making a private placement of securities must file Form PAS-3 within 15 days of allotment, including details of:
✔ Name & Address of Allottees
✔ PAN & Email ID
✔ Class & Number of Securities Allotted
✔ Consideration Received

🔹 Violation:
The company failed to provide complete details of allottees, particularly PAN and email IDs, violating Rule 14(6).
🔹 Impact: Due to these discrepancies, the Ministry of Corporate Affairs (MCA) had earlier rejected the company’s NDH-4 form.

Adjudication and Penalty:

📌 Show Cause Notice Issued to the company and its officers.
📌 The company admitted the violation, citing difficulties in obtaining shareholder details from remote areas.
📌 Hearing Date: 5th November 2024 – The company reiterated its position.

🔹 ROC Decision:
After reviewing the case, penalties were imposed under Section 450 of the Companies Act, 2013:
💰 ₹10,000 on Kalpakkam Nidhi Limited
💰 ₹10,000 on its Managing Director

Key Takeaways:

✅ Companies must ensure accurate and timely filing of statutory forms to avoid penalties and legal repercussions.
✅ Private placement compliance requires complete allottee details (including PAN & email ID).
✅ Challenges in obtaining shareholder details do not exempt companies from compliance.

This case serves as a reminder for businesses to maintain strict adherence to regulatory filing requirements! 📢


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