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

Himalaya Foods Ltd, a listed public company, delayed filing its AGM report and the delay continues. Under Section 121(3), which statement about the company's penalty is correct?

The company is liable to a penalty of Rs 1 lakh and, for continuing failure, a further Rs 500 for each day after the first, subject to a maximum of Rs 5 lakh. The Rs 25,000 minimum with a Rs 1 lakh cap applies to officers in default.

  1. ARs 1 lakh, plus Rs 500 per day after the first day, subject to a maximum of Rs 5 lakhCorrect
  2. BRs 50,000, plus Rs 100 per day, subject to a maximum of Rs 2 lakh
  3. CRs 1 lakh, plus Rs 500 per day, with no maximum limit
  4. DRs 25,000, plus Rs 500 per day, subject to a maximum of Rs 1 lakh

Explanation

For the company, Section 121(3) provides Rs 1 lakh, then Rs 500 for each day after the first during which the failure continues, capped at Rs 5 lakh. Rs 25,000 with a Rs 1 lakh cap is the officer-in-default figure, which is why the last option is wrong.

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