ADJUDICATION OF PENALTIES – AVOIDABLE LIABILITY

The Companies Act, 2013 (the Act) vide Section 454 provides for adjudication mechanism for imposing penalties for non-compliance of provisions of the Act. Accordingly, the Companies (Adjudication of Penalties) Rules, 2014 (the Adjudication Rules) was also notified. The difference between prosecution and adjudication is that the former is required to be handled by a court of judicature, whereas the later is slated to be handled by the bureaucracy. The Ministry of Corporate Affairs (MCA) is empowered to appoint officers not below the rank of Registrar of Companies (RoC) to function as adjudication officers.

………………..readmore