Auditor Penalised for Failure to Report Investment Disclosure Lapses Under Companies Act 2013 – ROC Kolkata Order

Background and Overview

The Registrar of Companies, Kolkata has issued an adjudication order levying a monetary penalty on the statutory auditor of a private limited company for failing to flag critical non-disclosures in the company's financial statements for the financial year 2016-17. The penalty was imposed under Section 454 of the Companies Act, 2013, for contravention falling within the scope of Section 450 of the same Act.

The matter arose from an inspection that revealed the company — Pingal Sales Private Limited (CIN: U51109WB2007PTC114316), registered at 7, Grant Lane, 2nd Floor, Room No. 218, Kolkata, West Bengal – 700012 — had disclosed investments aggregating approximately ₹37.46 crore in its financial statements as at 31st March 2017, but had omitted several mandatory particulars that are legally required under the applicable framework.

The individual who bore the consequence of this adjudication is the company's auditor, Amit Bhattacharjee (PAN: AAFFM3517P), who neither responded to the show cause notice nor requested an e-hearing, effectively leaving the allegations unchallenged.

Adjudicating Authority and Governing Framework

Appointment of Adjudicating Officer

The Ministry of Corporate Affairs, through Gazette Notification No. S.O. 698(E) dated 10/02/2026, appointed the undersigned as Adjudicating Officer under the powers vested by Section 454 of the Companies Act, 2013, read with the Companies (Adjudication of Penalties) Rules, 2014, for the purpose of adjudging and imposing penalties as provided under the Act.

The adjudication order bears Order ID: PO/ADJ/05-2026/WB/02163, dated 16/05/2026, and was issued from the office of ROC Kolkata I, 4th Floor, Plot No. IIIF/16, in AA-IIIF, Rajarhat, New Town, Akandakeshari, Kolkata – 700135.

Section 450 – General Penalty Clause

Section 450 of the Companies Act, 2013 operates as a residual penalty provision. It provides that where any company, officer of a company, or any other person contravenes any provision of the Act or rules framed thereunder — or breaches any condition, restriction, or limitation attached to an approval, sanction, consent, confirmation, recognition, direction, or exemption — and no specific penalty is prescribed elsewhere in the Act for such contravention, then:

The company and every officer in default, or such other person, shall be liable to a penalty of ₹10,000, and in case of a continuing contravention, a further penalty of ₹1,000 per day after the first day during which the contravention continues — subject to a maximum of ₹2,00,000 in the case of a company and ₹50,000 in the case of an officer in default or any other person.

Section 129 and Schedule III – Financial Statement Disclosures

Section 129 of the Companies Act, 2013 mandates that a company's financial statements must give a true and fair view of the company's state of affairs and must comply with the accounting standards notified under Section 133. Financial statements are to be prepared in the form specified in Schedule III of the Act.

Part I of Schedule III prescribes the format for the Balance Sheet and accompanying notes, and specifically requires that investments be disclosed with complete particulars, including: