P is a part time director of ABC Limited. J is a whole-time Director (Finance) and the Chief Financial Officer (CFO) of the company. The compliance officer had not been performing his duties in time and that has resulted

As per the provisions of Section 92 of the Companies Act 2013, if the company has not filed its annual return from the date by which it should have been filed with the fee and the additional fee if any, then every officer of the company who is in default shall be liable to a penalty of ₹ 10,000 and in case of continuous default the further penalty of ₹ 100 for each day during which the default continuous subject to a maximum of ₹ 2 lakh on the company and a maximum of ₹ 50,000 on the officer in default. As per the provisions of section 164(2) of the Companies Act, 2013, if the company has not filed its financial statements or the annual returns for a continuous period of 3 financial years, then every person who is, or has been a Director of that company shall not be eligible for the appointment as Director of that company or appointed in any other company for a period of 5 years from the date on which the said company fails to do so. As per the present problem, the compliance officer of ABC Limited had done the dereliction of the duty but the fact remains that the financial statements and annual returns were not filed with the ROC within the stipulated time which attract penalty under the aforementioned provisions of the Companies Act, 2013. Due to this violation, the Section 164 will come into operation. P and J, directors are deemed to have vacated the office of every other company in which they were director and their Director Identification number shall deem to have been cancelled immediately. Therefore, the appointment of P and J in the other company shall be void.