RoC Imposes Rs. 21.46 Lakh Penalty On Indus Biotech Limited And Its Officers For Failure To File Form BEN-2

Form BEN-2 is a form prescribed under the Companies Act, 2013 and the Companies (Significant Beneficial Owners) Rules, 2018. It is used by companies to file a return of significant beneficial owners with the Registrar of Companies. The purpose of Form BEN-2 is to ensure that the details of individuals who have a significant beneficial interest in the company are disclosed and maintained in a register.

An individual who holds a beneficial interest of not less than 25% in the shares of a company or has the right to exercise significant influence or control over the company. The significant beneficial owner must make a declaration in Form BEN-1 to the company. The company must file Form BEN-2 with the Registrar of Companies within 30 days of receiving the declaration from the significant beneficial owner.

Brief Facts:

Indus Biotech Limited filed Form BEN-2 on 26.04.2024 for declaring Rajan Ramaswamy Srinivasan and Rama Srinivasan as significant beneficial owners (SBO) of Srinivasam Family Trust, Ranjeet Palliyil Srinivasan and Sushama Ranjeet Srinivasan as SBO of R S Family Trust, Sunil Dutt Bhaskaran and Sunita Sunil Bhaskaran as SBO of Bhaskaran Family Trust, and Pankaj Kapal Mehra and Vanita Pankaj Mehra as SBO of Shree Siddhivinayak Trust under Section 90 of the Companies Act, 2013.

However, the SBO acquired such interest on 31.03.2017, and the declaration under sub-section (1) of Section 90 was made on 29.04.2019. The company failed to file Form BEN-2 with the Registrar within thirty days of receiving the declaration.

Consequently, the adjudicating officer issued an adjudication notice to the company and its officers in default for violating the provisions of Section 90 of the Companies Act, 2013. In response, the company submitted a letter stating that it filed Form BEN-2 on 26.04.2024 and received a signed BEN-1 from the Significant Beneficial Owners on 29th April 2019. The company explained that the failure to file Form BEN-2 was inadvertent and without malafide intention.

Observations by RoC:

The RoC noted that the company did not comply with the statutory requirements mandated by Section 90. This section obligates companies to maintain a register of significant beneficial owners and file returns of such owners with the Registrar. The failure to file Form BEN-2 constitutes a breach of these obligations. It noted that the company was supposed to file this form within thirty days from the date of receiving the declaration, but it failed to do so.

The RoC calculated the penalties based on the duration of the default, with a specific amount imposed per day of default. The company, Indus Biotech Limited, was held liable for a penalty of Rs. 9,96,000. Additionally, individual penalties are imposed on the company's officers: Sunil Dutt Bhaskaran, the Managing Director, was penalized Rs. 3,83,400; Achyut Jayatirthrao Huilgol, the Chief Financial Officer, also faced a penalty of Rs. 3,83,400; and Rucha Shamkant Khaire, the Company Secretary, was similarly penalized Rs. 3,83,400.