THE BOARD OF DISCIPLINE THE INSTITUTE OF COMPANY SECRETARIES OF INDIA

IN THE MATTER OF COMPLAINT OF PROFESSIONAL OR OTHER MISCONDUCT UNDER THE COMPANY SECRETARIES ACT, 1980

DC/334/2015

Order reserved on: 7th July, 2017 Order issued on : 24-tt. g-.4214e4r4 v,,

Mr. Rajat Kumar Bhalotia Complainant

Vs

Mr. Himanshu Sharma, ACS-27235 (CP No.11553) . Respondent

Present: Mrs. Meenakshi Gupta, Director (Discipline)

FINAL ORDER

1. The Board of Disciplineexamined the Complaint, Written Statement, Rejoinder, prima-fade opinion of the Director (Discipline).

2. The Board of Discipline noted the following: -

(v) The Complainant has inter-alga alleged that-

d) the Respondent has certified Form INC-22 forshifting of the Registered Office of, M/s. Sai Tech Medicare Pvt. Ltd from shop No. 71, New Grain Market, Ladwa, Kurukshetra, Haryana -136132 to shop no. 293/6, Sangam Market, Near Sugni Devi School,

coMPa Y S. Ladwa, Tehsil Thaneshar, Ladwa, Kurukshetra, Haryana -136132 without exercising due diligence.

IOSI

e) The Respondent has certified the form in non-compliance of the provisions of the Companies Act 2013 and Rules framed thereunder. The form was certified and filed beyond the time

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frame provided in the Companies Act, 2013. The Resolution of the Board of Directors attached in the form was totally illegal and in complete contravention to the Companies Act, 2013 and Secretarial Standards.

f) Attachments in the aforesaid form which was certified by Respondent were not in conformity with the provisions of law.

g) The Respondent ought to have found out that the Company was grossly mismanaged by its Managing Director in connivance with the other Directors of the company. The Respondent should have found out before certifying that the company had been consistently making various contraventions of the provisions of the Companies Act, 2013. A penalty was also imposed by the Registrar of Companies, NCT of Delhi and Haryana on the Company for not maintaining Registered Office in accordance with Section 12 of the Companies Act, 2013.

iii) The Respondent denied all the allegations levied against him and contended that: -

i) He had been engaged by the Company for the certification of E-form INC 22. While certifying the form, he had acted with due diligence and had verified the attachments to the form which were found in conformity with the provisions of Section 12 of the Companies Act, 2013 read with Rule 25 of Companies (Incorporation) Rules, 2014.

j) He was engaged only for limited Scope and was unaware of the Internal Management of the Company and was unnecessarily being dragged into ❑ dispute which existed between the Directors in managing the company.

k) Before certifying the form, he had verified the following information, documents and records:

i. Authority of the Board through a resolution passed by circulation and further ratified in the next Board meeting.

ii. Minute Books of the Board of Director,s being maintained since 27/05/2015

iii. The attendances register to ascertain the quorum and attendance of the Directors of the Board, which was in order.

iv. The Electricity Bill of the registered office, which was not older than two months.

v. Had visited the new address of the registered office of the Company, to which it had shifted and found it in order.

I) He denied of having issued any certificate to the Company in respect of a circular resolution passed on 13thJuly 2015.

m) E-form INC 22 was produced for certification after the expiry of the normal filing time of 15 days. He had only certified the form after due verifications; and had not filed the form, as he was engaged for certification and not filing the form.

n) He denied of having casted unlimited responsibilities t upon him while certifying the form INC 22. He had exercised due care as was required by him in certifying and verifying facts and documents.

o) There was no bar in filing any form after the expiry of the prescribed time period. And, a professional could not be held liable if the Company had not filed the form within the prescribed period.

p) He was under no obligation to verify the indoor management /working of the Company including process followed for passing resolution.

q) There was no bar in holding a Board Meeting with shorter notice as per section 173(3) of the Companies Act, 2013. He had duly verified the Notices, Agenda and minutes along with Attendance Register and dispatch Register for holding Board meeting and found to be in order.

r) There was no prohibition to give public notice for change of registered office by the Company which was one of the attachments. He has also verified other documents like No-

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Objection certificate given by the landlord, the utility bills and copy of sale deed of the premises.

s) All the aforesaid documents were personally verified by him and found to be legitimate, authentic, un-biased and in order.

11 1 3. The Board of Discipline considered the prima-facie opinion dated 27"

June, 2017 in the complaint of professional or other misconduct filed by Mr. Rajat Kumar Bhalotia against Mr. Himanshu Sharma, ACS-27235 (CP No.11553)under sub-section (3) of Section 21 of the Company Secretaries Act. 1980 (the Act) wherein the Director (Discipline) is prima facie of opinion that the Respondent is "Not guilty" of Professional or other misconduct under the Company Secretaries Act, 1980 as he had exercised due diligence while certifying the alleged e-Form INC22.

4. The Board of Discipline also noted the following observations of the Director (Discipline) in this complaint: -

k) The Registered office of the Company, M/sSai Tech Medicare Pvt. Ltd was shifted within the local limit of city. Town or village to another place within the limit of same city, town or village for which the Respondent had certified Form INC 22. The Respondent was required to comply with the provisions of Section 12 of the Companies Act, 2013 read with Rule 25 of Companies (Incorporation) Rules, 2014 for certification of Form INC 22.

I) Rule 25 of Companies (Incorporation) Rules. 2014 provides as under:-

"(1) the verification of the registered office shall be filed with ROC in Form No.INC.22 along with the fee, and

(2) There shall be attached to say Form, any of the following documents, namely:-

a. the registered document of the title of the premises of the registered office in the name of the company;

b. the notarized copy of lease or rent agreement in the name of the company along with a copy of rent paid receipt not older than one month;

c. the authorization from the owner or authorized occupant of the premises along with proof of ownership or occupancy authorization, to use the premises by the company as its registered office: and

d. The proof of evidence of any utility service like telephone, gas, electricity, etc. depicting the address of the premises in the name of the owner or document, as the case may be, which is not older than two months."

m) The main issue for consideration is whether the respondent has exercised due diligence in certifying the alleged E-Form INC-22 of M/s Sai Tech Medicare Pvt. Ltd. and it has been observed that the Respondent had verified that the following documents in compliance with the Rule 25 of Companies (Incorporation) Rules 2014:-

i. NOC of the Landlord ii. Ownership Proof iii. Utility Bill iv. Board Resolution v. Resolution passed by Circulation vi. Newspaper Publication

n) The Registered office of the Company was shifted within the local limit of city, Town or village to another place within the limit of same city, town or village authority of the Board through a resolution passed by it was sufficient. The Respondent had verified the existence of such Board Resolution /authority of the Board.

o) The Respondent had visited the new Registered Office given in the form to ascertain whether such address was used by the Company as its Registered Office and whether it was functioning for business purposes. The Respondent had also checked the newspaper publication given by the Company in this regard and verified the existence of such Board Resolution /authority of the Board.

p) The Respondent was engaged for certifying form INC 22. He was neither engaged for ascertaining the fact that the affairs of the Company were mismanaged nor was he engaged to examine and verify other compliances or non-compliances.

q) He had exercised due care as was required of him in certifying and verifying facts and documents in relation to e-form INC 22 only for which he was engaged.

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r) The Respondent cannot be held liable for non-filing of the e-Form by the company beyond the normal filing period prescribed in the Act, which was only certified by him.

5. The Board of Disciplineaf its meeting held on 7th July, 2017, after considering the aforesaid observations, material on record, prima-fade opinion of the Director (Discipline) and all the facts and circumstances of the case, agreed to the prima-facie opinion of the Director (Discipline), that the Respondent is "Not Guilty" of Professional or other misconduct under the Company Secretaries Act, 1980 as he has verified the requisite documents of the company and accordingly exercised due diligence in certifying the alleged e-form INC-22 of M/s Sai Tech Medicare Pvt. Ltd

• ;, •

CS Ashish Doshi Presiding Officer

CS Dinesh andra Arora Member

CS C Ramasubramaniam