Team Blitz India
NEW DELHI: The Ministry of Corporate Affairs (MCA) has fined four companies in the past two months for failing to appoint female Directors according to the timelines stated in the Companies (Appointment and Qualification of Directors) Rules.
Three private and one Maharashtra Government company have been served notices so far. The development sheds light on the Government’s emphasis on having more female representatives in company boardrooms. Government entity MSRDC Sea Link, a whollyowned arm of the Maharashtra State Road Development Corporation, has been slapped a penalty of Rs 1,85,000.
As per senior Government sources, the order against a state Government entity, in addition to the private ones, shows that corporate governance rules are to be complied with by everyone, and there is no special treatment for anybody. The officer indicated a hardening of the Government’s stance on the issue in the coming months.
The Registrar of Companies (RoC) under the MCA has imposed penalties amounting to Rs 4,85,000 each on JM Financial Properties and Holdings, Shankar Packagings Krishna Solvechem, and some of their key officials since mid-October.
According to Companies Rules (Appointment and Qualification of Directors), all listed companies and large public limited firms with paidup capital of Rs 100 crore or more or having a minimum turnover of Rs 300 crore must appoint at least one female to their Board of Directors. If a female director quits, the vacancy must be filled by the next board meeting or within three months, whichever is later.
The Government has issued dozens of show-cause notices to companies for non-compliance with appointment and qualification of director rules. Having issued the notices, the RoC started issuing orders based on the responses received from the companies concerned.
According to the rules, both the companies and the officers responsible can be penalised. The rules say each defaulting firm can be subjected to a maximum fine of Rs 300,000, and the officer concerned can be fined up to Rs 100,000 in such cases.
