How to Maintenance the Minutes of the Company u/s 118 ?

How to Maintenance the Minutes of the Company u/s 118 ?. Maintenance of Minutes of the Meetings under Companies-Act-2013
This adjudication order was delivered by the Registrar of Companies (ROC), Ahmedabad, under the authority vested by Section 454 of the Companies Act, 2013. The matter pertains to a violation of Section 118(11) of the Act by Harsh Gathani Enterprise Private Limited and some of its officers. The order, dated 24 June 2025 and identified by Order ID: PO/ADJ/06-2025/AD/00440, specifies the individuals responsible for the default and imposes monetary penalties on them. At its core, the dispute relates to the company’s failure to adhere to the statutory requirements under Section 118, which govern the manner in which minutes of meetings are to be recorded. Upon inspection, the adjudicating officer observed that the minutes books of the company were incomplete, most notably because they lacked the date of entry as required under Secretarial Standard–1 (SS-1). This omission was treated as a contravention of law and resulted in penalties being imposed both on the company and on the officers held accountable. 
Facts and Background of the Case
The proceedings were initiated against Harsh Gathani Enterprise Private Limited, a company incorporated under the Companies Act, 2013, along with its directors. During an inspection of the company’s records, the Inspecting Officer examined the minutes books and detected certain irregularities. It was discovered that the minutes of board meetings were not properly documented, as the essential requirement of recording the date of entry had been ignored. Under Secretarial Standard–1, this date is a mandatory element, and its absence amounted to a clear violation.
In corporate practice, the maintenance of minutes is not simply a procedural formality but a statutory safeguard that ensures transparency, accountability, and authenticity of decisions taken by the board or shareholders. The omission of such an important detail was therefore considered a breach of Section 118 of the Companies Act, 2013. Acting upon the inspection report, the Regional Director (North Western Region) on 16 September 2023 instructed the Registrar of Companies to initiate action against the company. The ROC thereafter began adjudication proceedings and issued notices to the company as well as its directors, providing them with an opportunity to respond both in writing and during an oral hearing.
In its submissions, the company argued that two of the individuals named in the notice, namely Mr. Dhiren Vinodchandra Shah and Mr. Dilipbhai Chinubhai Shah, were not serving as directors during the financial year 2014–15, which was the period of default under consideration. This contention was partially accepted by the ROC. Upon a review of the records, the ROC concluded that Mr. Parag Rameshbhai Gathani and Mr. Shrirang Shaunakkumar Bhatt were indeed directors during the relevant time and therefore responsible for the lapse. As a result, the company was penalised with a fine of Rs.25,000, while the two directors in default were fined Rs.5,000 each. 
Issues
The case essentially revolved around three legal issues. The first was whether Harsh Gathani Enterprise Private Limited had in fact violated Section 118 of the Companies Act, 2013, by failing to maintain its minutes in accordance with the prescribed standards. The second issue was whether liability extended to all the directors named in the inspection report, or only to those who were in office during the financial year in which the default occurred. The third issue was the quantum of penalty that should be imposed under Section 118(11), read with Section 454 of the Companies Act, 2013. 
Rules and Legal Provisions
Several provisions of company law were central to the adjudication. Section 118 of the Companies Act, 2013 prescribes the procedure for preparing, signing, and maintaining minutes of meetings of both the board and the shareholders. Sub-section (11) of this provision lays down penalties for default, fixing the liability of the company at Rs.25,000 and of each officer in default at Rs.5,000. Alongside this, Secretarial Standard–1, framed by the Institute of Company Secretaries of India and approved by the Central Government, sets out detailed requirements for the conduct of board meetings, including the mandatory requirement that the date of entry of minutes be recorded in the minutes book. Section 454 of the Companies Act, 2013 confers on adjudicating officers the authority to impose penalties where non-compliance has been established, while also giving aggrieved parties the right to appeal to the Regional Director. Finally, the Companies (Adjudication of Penalties) Rules, 2014 prescribe the procedure to be followed during adjudication, covering the issuance of notices, conduct of hearings, and passing of orders. 
Analysis
In analysing the matter, the ROC considered the inspection report, the submissions of the company’s authorised representative, and the applicable legal provisions. The first issue was whether a violation of Section 118(11) had occurred. The inspection clearly showed that the minutes books lacked the date of entry, an omission that directly contravened SS-1. Since Section 118 requires mandatory compliance with secretarial standards, the company’s conduct amounted to a clear breach of law.
The second issue related to the responsibility of the officers. The company contended that not all of the individuals named in the notice were directors during the relevant period. This argument was accepted in part. The ROC reasoned that liability could not be imposed on persons who were not holding office at the time of the default. Consequently, Mr. Dhiren Vinodchandra Shah and Mr. Dilipbhai Chinubhai Shah were not held liable. By contrast, Mr. Parag Rameshbhai Gathani and Mr. Shrirang Shaunakkumar Bhatt were serving directors during the relevant financial year and were therefore found to be officers in default.
The third issue concerned the penalties. Section 118(11) prescribes fixed penalties, namely Rs.25,000 for the company and Rs.5,000 for each officer in default. The ROC applied the law strictly and imposed exactly these amounts, neither enhancing nor reducing them. This shows that the adjudicating authority exercised no discretion but rather adhered to the legislative mandate.
Finally, the proceedings reflected compliance with the principles of natural justice. The company and its officers were given adequate opportunities to present their written and oral submissions. Their defence was considered, and relief was granted to those who were not in office during the relevant period. This demonstrates that the adjudication process was conducted fairly and was not mechanical. 
Judgment
On the basis of the above findings, the ROC passed an order penalising Harsh Gathani Enterprise Private Limited with a fine of Rs.25,000 for violation of Section 118(11). In addition, Mr. Parag Rameshbhai Gathani and Mr. Shrirang Shaunakkumar Bhatt were identified as the officers in default and fined Rs.5,000 each. The other two individuals, namely Mr. Dhiren Vinodchandra Shah and Mr. Dilipbhai Chinubhai Shah, were exempted from liability as they were not directors during the relevant period. The penalties were to be paid personally by the officers concerned and could not be charged to the company’s funds. The company and its officers were directed to rectify the default within ninety days of receipt of the order. Furthermore, the order clarified that an appeal could be filed before the Regional Director, Ahmedabad, within sixty days of receipt. 
Legal Impact of the Order 
The adjudication order has significant implications for corporate governance and compliance. It reinforces the principle that adherence to Secretarial Standards is not optional but mandatory, and even seemingly minor requirements, such as recording the date of entry in minutes books, must be strictly observed. The order also highlights the principle of personal liability of directors, making it clear that responsibility rests with those in office during the period of default and cannot be shifted to others. In addition, by imposing penalties even for what may appear to be technical lapses, the order serves as a deterrent to companies that might otherwise neglect compliance. At the same time, the ROC demonstrated fairness by relieving individuals of liability if they were not in office at the time of the contravention, showing that responsibility is fixed with precision rather than indiscriminately. Lastly, the availability of appellate remedies ensures that the adjudication process remains balanced and subject to oversight. 
Final Note of the Article
The case of Harsh Gathani Enterprise Private Limited underscores the strict enforcement approach adopted by the Ministry of Corporate Affairs in matters of corporate governance. Section 118(11) of the Companies Act, 2013 requires companies to maintain accurate and complete minutes in accordance with Secretarial Standards, and deviations from these requirements, even if minor or technical, are penalised. In this matter, the failure to record the date of entry in the minutes book resulted in the imposition of fines amounting to Rs.25,000 on the company and Rs.5,000 each on two directors. The ROC balanced the need for enforcement with fairness by exempting those who were not serving as directors during the relevant period.
This case therefore stands as an important reminder to companies and directors that compliance with statutory obligations is not a mere formality but an essential element of responsible corporate conduct. Accurate record-keeping and strict adherence to secretarial standards reflect not only compliance with the law but also commitment to transparency, accountability, and good governance.  
Download MCA Adjudication Order

Maintenance of Minutes of the Meetings under Companies-Act-2013

This adjudication order was delivered by the Registrar of Companies (ROC), Ahmedabad, under the authority vested by Section 454 of the Companies Act, 2013. The matter pertains to a violation of Section 118(11) of the Act by Harsh Gathani Enterprise Private Limited and some of its officers. The order, dated 24 June 2025 and identified by Order ID: PO/ADJ/06-2025/AD/00440, specifies the individuals responsible for the default and imposes monetary penalties on them. At its core, the dispute relates to the company’s failure to adhere to the statutory requirements under Section 118, which govern the manner in which minutes of meetings are to be recorded. Upon inspection, the adjudicating officer observed that the minutes books of the company were incomplete, most notably because they lacked the date of entry as required under Secretarial Standard–1 (SS-1). This omission was treated as a contravention of law and resulted in penalties being imposed both on the company and on the officers held accountable.

Facts and Background of the Case

The proceedings were initiated against Harsh Gathani Enterprise Private Limited, a company incorporated under the Companies Act, 2013, along with its directors. During an inspection of the company’s records, the Inspecting Officer examined the minutes books and detected certain irregularities. It was discovered that the minutes of board meetings were not properly documented, as the essential requirement of recording the date of entry had been ignored. Under Secretarial Standard–1, this date is a mandatory element, and its absence amounted to a clear violation.

In corporate practice, the maintenance of minutes is not simply a procedural formality but a statutory safeguard that ensures transparency, accountability, and authenticity of decisions taken by the board or shareholders. The omission of such an important detail was therefore considered a breach of Section 118 of the Companies Act, 2013. Acting upon the inspection report, the Regional Director (North Western Region) on 16 September 2023 instructed the Registrar of Companies to initiate action against the company. The ROC thereafter began adjudication proceedings and issued notices to the company as well as its directors, providing them with an opportunity to respond both in writing and during an oral hearing.

In its submissions, the company argued that two of the individuals named in the notice, namely Mr. Dhiren Vinodchandra Shah and Mr. Dilipbhai Chinubhai Shah, were not serving as directors during the financial year 2014–15, which was the period of default under consideration. This contention was partially accepted by the ROC. Upon a review of the records, the ROC concluded that Mr. Parag Rameshbhai Gathani and Mr. Shrirang Shaunakkumar Bhatt were indeed directors during the relevant time and therefore responsible for the lapse. As a result, the company was penalised with a fine of Rs.25,000, while the two directors in default were fined Rs.5,000 each.

Issues

The case essentially revolved around three legal issues. The first was whether Harsh Gathani Enterprise Private Limited had in fact violated Section 118 of the Companies Act, 2013, by failing to maintain its minutes in accordance with the prescribed standards. The second issue was whether liability extended to all the directors named in the inspection report, or only to those who were in office during the financial year in which the default occurred. The third issue was the quantum of penalty that should be imposed under Section 118(11), read with Section 454 of the Companies Act, 2013.

Rules and Legal Provisions

Several provisions of company law were central to the adjudication. Section 118 of the Companies Act, 2013 prescribes the procedure for preparing, signing, and maintaining minutes of meetings of both the board and the shareholders. Sub-section (11) of this provision lays down penalties for default, fixing the liability of the company at Rs.25,000 and of each officer in default at Rs.5,000. Alongside this, Secretarial Standard–1, framed by the Institute of Company Secretaries of India and approved by the Central Government, sets out detailed requirements for the conduct of board meetings, including the mandatory requirement that the date of entry of minutes be recorded in the minutes book. Section 454 of the Companies Act, 2013 confers on adjudicating officers the authority to impose penalties where non-compliance has been established, while also giving aggrieved parties the right to appeal to the Regional Director. Finally, the Companies (Adjudication of Penalties) Rules, 2014 prescribe the procedure to be followed during adjudication, covering the issuance of notices, conduct of hearings, and passing of orders.

Analysis

In analysing the matter, the ROC considered the inspection report, the submissions of the company’s authorised representative, and the applicable legal provisions. The first issue was whether a violation of Section 118(11) had occurred. The inspection clearly showed that the minutes books lacked the date of entry, an omission that directly contravened SS-1. Since Section 118 requires mandatory compliance with secretarial standards, the company’s conduct amounted to a clear breach of law.

The second issue related to the responsibility of the officers. The company contended that not all of the individuals named in the notice were directors during the relevant period. This argument was accepted in part. The ROC reasoned that liability could not be imposed on persons who were not holding office at the time of the default. Consequently, Mr. Dhiren Vinodchandra Shah and Mr. Dilipbhai Chinubhai Shah were not held liable. By contrast, Mr. Parag Rameshbhai Gathani and Mr. Shrirang Shaunakkumar Bhatt were serving directors during the relevant financial year and were therefore found to be officers in default.

The third issue concerned the penalties. Section 118(11) prescribes fixed penalties, namely Rs.25,000 for the company and Rs.5,000 for each officer in default. The ROC applied the law strictly and imposed exactly these amounts, neither enhancing nor reducing them. This shows that the adjudicating authority exercised no discretion but rather adhered to the legislative mandate.

Finally, the proceedings reflected compliance with the principles of natural justice. The company and its officers were given adequate opportunities to present their written and oral submissions. Their defence was considered, and relief was granted to those who were not in office during the relevant period. This demonstrates that the adjudication process was conducted fairly and was not mechanical.

Judgment

On the basis of the above findings, the ROC passed an order penalising Harsh Gathani Enterprise Private Limited with a fine of Rs.25,000 for violation of Section 118(11). In addition, Mr. Parag Rameshbhai Gathani and Mr. Shrirang Shaunakkumar Bhatt were identified as the officers in default and fined Rs.5,000 each. The other two individuals, namely Mr. Dhiren Vinodchandra Shah and Mr. Dilipbhai Chinubhai Shah, were exempted from liability as they were not directors during the relevant period. The penalties were to be paid personally by the officers concerned and could not be charged to the company’s funds. The company and its officers were directed to rectify the default within ninety days of receipt of the order. Furthermore, the order clarified that an appeal could be filed before the Regional Director, Ahmedabad, within sixty days of receipt.

Legal Impact of the Order

The adjudication order has significant implications for corporate governance and compliance. It reinforces the principle that adherence to Secretarial Standards is not optional but mandatory, and even seemingly minor requirements, such as recording the date of entry in minutes books, must be strictly observed. The order also highlights the principle of personal liability of directors, making it clear that responsibility rests with those in office during the period of default and cannot be shifted to others. In addition, by imposing penalties even for what may appear to be technical lapses, the order serves as a deterrent to companies that might otherwise neglect compliance. At the same time, the ROC demonstrated fairness by relieving individuals of liability if they were not in office at the time of the contravention, showing that responsibility is fixed with precision rather than indiscriminately. Lastly, the availability of appellate remedies ensures that the adjudication process remains balanced and subject to oversight.

Final Note of the Article

The case of Harsh Gathani Enterprise Private Limited underscores the strict enforcement approach adopted by the Ministry of Corporate Affairs in matters of corporate governance. Section 118(11) of the Companies Act, 2013 requires companies to maintain accurate and complete minutes in accordance with Secretarial Standards, and deviations from these requirements, even if minor or technical, are penalised. In this matter, the failure to record the date of entry in the minutes book resulted in the imposition of fines amounting to Rs.25,000 on the company and Rs.5,000 each on two directors. The ROC balanced the need for enforcement with fairness by exempting those who were not serving as directors during the relevant period.

This case therefore stands as an important reminder to companies and directors that compliance with statutory obligations is not a mere formality but an essential element of responsible corporate conduct. Accurate record-keeping and strict adherence to secretarial standards reflect not only compliance with the law but also commitment to transparency, accountability, and good governance.