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CS Executive · Company Law and Practice · Annual Report - Concepts

A listed public company failed to file its AGM report on time. What is the minimum penalty on each officer of the company who is in default under Section 121(3), and the maximum if the failure continues?

An officer in default faces a penalty of not less than Rs 25,000, with a further Rs 500 for each day after the first if the failure continues, subject to a maximum of Rs 1 lakh. The higher Rs 1 lakh to Rs 5 lakh range is for the company.

  1. ANot less than Rs 1 lakh; maximum Rs 5 lakh
  2. BNot less than Rs 25,000; maximum Rs 1 lakhCorrect
  3. CNot less than Rs 10,000; maximum Rs 50,000
  4. DNot less than Rs 5,000; maximum Rs 25,000

Explanation

Section 121(3) says an officer in default is liable to a penalty not less than Rs 25,000 and, for continuing failure, Rs 500 per day after the first, up to Rs 1 lakh. Rs 1 lakh to Rs 5 lakh is the company's own penalty.

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