Section 454 Adjudication of penalties – Companies Act 2013

Section 454 of Companies Act 2013 amended Jan 2021 by Companies (Amendment) Act, 2020 and Company Rules for adjudication of penalties.

Amended and updated notes on section 454 of the Companies Act 2013 as amended by the Companies (Amendment) Act, 2020 and Company Rules made there under. Detail discussion on provisions and rules related to Adjudication of penalties.

Chapter XXIX (Sections 447 to 470) of the Companies Act 2013 (CA 2013) deals with the provisions related to miscellaneous. Section 454 of CA 2013 provides for Adjudication of penalties.

Recently, we have discussed in detail section 453 (Punishment for improper use of “Limited” or “Private Limited”) of CA 2013. Today, we learn the provisions of section 454 of the Companies Act 2013. The amended provision of section 454 is effective for the financial year 2020-21 onwards.

In this article, you will learn detail of the provisions of section 454 of the Companies Act 2013 Bare Act read with the relevant Company Rules 2021 as provided by Ministry of Corporate Affairs (MCA), Government of India.

Name of ActThe Companies Act 2013
Enacted byParliament of India
Administered byMinistry of Corporate Affairs (MCA)
Number of Chapters29
Number of Sections484 (470-43+57)
Number of Schedules7
You are reading:
Chapter No.XXIX
Chapter NameMiscellaneous
Section No.454
Section NameAdjudication of penalties
Monthly Updated EditionCompany Law PDF

Section 454: Adjudication of penalties

Section 454(1) of Companies Act

The Central Government may, by an order published in the Official Gazette, appoint as many officers of the Central Government, not below the rank of Registrar, as adjudicating officers for adjudging penalty under the provisions of this Act in the manner as may be prescribed.

Section 454(2) of Companies Act

The Central Government shall while appointing adjudicating officers, specify their jurisdiction in the order under sub-section (1).

Section 454(3) of Companies Act

The adjudicating officer may, by an order

  • (a) impose the penalty on the company, the officer who is in default, or any other person, as the case may be, stating therein any non-compliance or default under the relevant provisions of this Act; and
  • (b) direct such company, or officer who is in default, or any other person, as the case may be, to rectify the default, wherever he considers fit.

Provided that in case the default relates to non-compliance of sub-section (4) of section 92 or sub-section (1) or sub-section (2) of section 137 and such default has been rectified either prior to, or within thirty days of, the issue of the notice by the adjudicating officer, no penalty shall be imposed in this regard and all proceedings under this section in respect of such default shall be deemed to be concluded.

[Proviso of sub-section(3) of section 454 has been inserted w.e.f. 22.01.2021 by the Companies (Amendment) Act, 2020 vide MCA Notification No. S.O. 325(E) dated 22nd January, 2021]

Section 454(4) of Companies Act

The adjudicating officer shall, before imposing any penalty, give a reasonable opportunity of being heard to such company, the officer who is in default or any other person.

Section 454(5) of Companies Act

Any person aggrieved by an order made by the adjudicating officer under sub-section (3) may prefer an appeal to the Regional Director having jurisdiction in the matter.

Section 454(6) of Companies Act

Every appeal under sub-section (5) shall be filed within sixty days from the date on which the copy of the order made by the adjudicating officer is received by the aggrieved person and shall be in such form, manner and be accompanied by such fees as may be prescribed.

Section 454(7) of Companies Act

The Regional Director may, after giving the parties to the appeal an opportunity of being heard, pass such order as he thinks fit, confirming, modifying or setting aside the order appealed against.

Section 454(8) of Companies Act

(i) Where company fails to comply with the order made under sub-section (3) or sub-section (7), as the case may be, within a period of ninety days from the date of the receipt of the copy of the order, the company shall be punishable with fine which shall not be less than twenty-five thousand rupees but which may extend to five lakh rupees.

(ii) Where an officer of a company or any other person who is in default fails to comply with the order made under sub-section (3) or sub-section (7), as the case may be, within a period of ninety days from the date of the receipt of the copy of the order, such officer shall be punishable with imprisonment which may extend to six months or with fine which shall not be less than twenty-five thousand rupees but which may extend to one lakh rupees, or with both.

The Central Government appointed the following Registrars of Companies as adjudicating officers in respect of jurisdictions indicated against each Registrar vide S.O. 831(E) dated 24-March-2015 as last amended by S.O. 2650(E) dated 25th July, 2019:

SL. No.DesignationStates/ Union territories under his jurisdiction
1Registrar of Companies, DelhiUnion territory of Delhi and whole State of Haryana.
2Registrar of Companies, ChandigarhWhole State of Punjab and Union territory of Chandigarh.
3Registrar of Companies, KanpurWhole State of Uttar Pradesh
4Registrar of Companies-cum-Official Liquidator, DehradunWhole State of Uttarakhand
5Registrar of Companies-cum-Official Liquidator, JammuWhole State of Jammu and Kashmir
6Registrar of Companies-cum-Official Liquidator, ShimlaWhole State of Himachal Pradesh
7Registrar of Companies, KolkataWhole State of West Bengal.
8Registrar of Companies-cum-Official Liquidator, PatnaWhole State of Bihar.
9Registrar of Companies-cum-Official Liquidator, CuttackWhole State of Orissa.
10Registrar of Companies-cum-Official Liquidator, RanchiWhole State of Jharkhand
11Registrar of Companies GuwahatiWhole States of Assam, Meghalaya, Manipur, Tripura, Mizoram, Nagaland and Arunachal Pradesh.
12Registrar of Companies, Chennai(i) Whole State of Tamil Nadu except Coimbatore, Dharmapuri, Dindigul, Erode, Krishnagiri, Namakkal, Nilgiris, Salem, Tiruppur districts. (ii) Union territory of Andaman and Nicobar Islands.
13Registrar of Companies, CoimbatoreCoimbatore, Dharmapuri, Dindigul, Erode, Krishnagiri, Namakkal, Nilgiris, Salem, Tiruppur districts the State of Tamil Nadu.
14Registrar of Companies, PuducherryUnion territory of Puducherry
15Registrar of Companies, ErnakulamWhole State of Kerala and Union territory of Lakshadweep Islands
16Registrar of Companies, HyderabadWhole States of Telangana
17Registrar of Companies, BangaloreWhole State of Karnataka
18Registrar of Companies, MumbaiWhole State of Maharashtra except Pune, Ahmednagar, Kolhapur, Solapur, Satara, Sangli, Ratnagiri, Sindhudurg
19Registrar of Companies, PunePune, Ahmednagar, Kolhapur, Solapur, Satara, Sangli, Ratnagiri, Sindhudurg districts the State of Maharashtra.
20Registrar of Companies-cum-Official Liquidator, GoaWhole State of Goa and Union territory of Daman and Diu.
21Registrar of Companies, AhmedabadWhole State of Gujarat and Union territory of Dadra and Nagar Haveli
22Registrar of Companies, GwaliorWhole State of Madhya Pradesh.
23Registrar of Companies-cum-Official Liquidator, BilaspurWhole State of Chhattisgarh
24Registrar of Companies-cum-Official Liquidator, JaipurWhole State of Rajasthan
25Registrar of Companies, VijayawadaWhole State of Andhra Pradesh

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