Section 12: Company Registered Office Capable of Receiving and Acknowledging all Communications and Notices

Section 12: Company Registered Office Capable of Receiving and Acknowledging all Communications and Notices. Contravention of Section 12 of the Companies Act, 2013 Non Capable of Receiving and Acknowledging all Communications and Notices
A company's registered office is not merely a statutory address it is the central hub through which vital communications, legal notices, and regulatory correspondence are directed. Maintaining this office and ensuring its accessibility is a cornerstone requirement of corporate compliance under Indian company law. Section 12 of the Companies Act, 2013, enshrines this principle with clear mandates and prescribes penal consequences for defaults. This brief narrates the recent penalty order delivered by the Registrar of Companies (ROC) Chennai, which found Sonu Infraprojects and Builders Private Limited and its directors in violation of their obligations to maintain a registered office, and illustrates both the substance and significance of strict statutory adherence. 
Background and Facts
Sonu Infraprojects and Builders Private Limited, bearing Corporate Identification Number U45200TN2008PTC066363, was incorporated and registered under the Companies Act with its stipulated registered office in Valmiki Nagar, Kanchipuram, Chennai, Tamil Nadu. As of the relevant period in 2023, the company’s directors included Adilakshmi Kancherla (DIN 00907603), Potlapally Lakshmi Sailaja (DIN 01797144), and Narasinga Pakeeraiah (DIN 03146812), all of whom held fiduciary and managerial positions with responsibility for compliance.
The issue originated from an investigation initiated under Section 210 of the Companies Act, 2013, which authorises the Central Government to direct inquiries into the affairs of a company. In this case, the Investigating Officer (I.O.), acting on instructions from the Ministry of Corporate Affairs, sought to determine whether Sonu Infraprojects and Builders Private Limited was properly maintaining its registered office, as mandated by Section 12(1) of the Act. Upon physically visiting the address recorded with the ROC on 6 February 2023, the I.O. found that the registered office did not exist at the stated location; in fact, there was no physical office at all to receive communications or legal notices.
Section 12(1) is unequivocal in its requirement that every company must establish a registered office within thirty days of incorporation and maintain it at all times thereafter. This office must be capable of accepting all statutory communication. The observed breach constituted a clear violation, not only of the procedural aspects of the Act but also its underlying spirit ensuring that companies are reachable and accountable.
Following submission of the Inspection Report, the Ministry directed the ROC to commence penalty proceedings under Section 12(8), which was then triggered by the issue of e-adjudication notice on 20 February 2025. Despite being granted both an opportunity to respond and a separate hearing date on 20 March 2025, the company and all listed directors failed to reply or appear, resulting in ex-parte proceedings as per Rule 3(8) of the Companies (Adjudication of Penalties) Rules, 2014.
Legal Issues Identified
The key legal questions for the adjudicating authority included:

Did the company and its officers breach Section 12(1) and 12(8) by failing to maintain a functioning registered office at the notified address?

What remedial and penal consequences were warranted under the circumstances of continued default, given the absence of cooperation or rectification by the company and its officers?

What obligations followed for all those penalised, both in terms of payment and rectification?

What recourse, if any, did the company and directors retain following the ex-parte order?

Legal Framework and Penalty Principles

Section 12 of the Companies Act, 2013- This Section codifies the statutory requirements for registered offices, emphasising accountability and transparency. It provides that the registered office is to be available for receipt of all communications and legal process, underlining transparency and enabling service of process as well as engagement by regulators, creditors, and stakeholders.

Section 12(8) of the Company Act 2013- This Section explicitly states that any default in maintaining the registered office as required attracts a penalty of Rs.1,000 for every day the default continues, with an upper limit of Rs.1,00,000 per defaulting officer and per company. The law is designed not only for punishment but also deterrence, incentivising ongoing compliance and prompt rectification. Section 454 and the Companies (Adjudication of Penalties) Rules, 2014 provide the procedural tools for the ROC to conduct investigation, offer a hearing, make findings of fact, and enforce penalties.

Adjudication and Findings
The ROC, Chennai, having reviewed the inspection results, the statutory notices, and the failure of the company and its directors to engage in the process, rendered a detailed ex-parte order.
The authority established that:

Sonu Infraprojects and Builders Private Limited was not maintaining its registered office at the address officially filed with the ROC and, as a result, was not meeting statutory mandates under Section 12(1).

Directors Adilakshmi Kancherla, Potlapally Lakshmi Sailaja, and Narasinga Pakeeraiah, each with ongoing managerial and compliance responsibilities, were in default for the same period.

None of the parties offered any defence or evidence of rectification. This combined lack of response and rectification aggravated their liability.

Accordingly, the following penalties were imposed:

Sonu Infraprojects and Builders Private Limited: Rs.1,00,000

Adilakshmi Kancherla: Rs.1,00,000

Potlapally Lakshmi Sailaja: Rs.1,00,000

Narasinga Pakeeraiah: Rs.1,00,000

The penalty was imposed at the upper statutory limit, given the apparent duration of default and the total lack of engagement by the company and directors, which left the ROC no opportunity to consider mitigating circumstances. The ROC also issued a remedial directive: the company must rectify the default within thirty days, re-establish the registered office in line with the Act, and submit proof (including photographs, rental/ownership documents, and supporting paperwork) to the ROC.
The directors and company are to pay their respective fines from personal sources, not using company funds for individual penalties. Payment must be made through the Ministry of Corporate Affairs e-Adjudication portal within ninety days from receipt of the order, with proof of compliance to be uploaded accordingly.
Appeal
The adjudicating order clearly outlines recourse for the affected parties. An appeal may be filed before the Regional Director, Chennai, within sixty days of the order’s receipt. The process requires submission of Form ADJ with grounds for appeal and a certified copy of the ROC’s order, in compliance with both Section 454(5)-(6) of the Companies Act and the related penalty rules. This preserves procedural fairness and provides a legal outlet for those wishing to contest the decision or quantum of penalty.
Final Note of the Article
The case of Sonu Infraprojects and Builders Private Limited serves as a salient reminder of the non-negotiable nature of core corporate compliance obligations in India. Failure to maintain a registered office is more than a technical lapse; it is an actionable default that strikes at the heart of transparency and accountability. The ROC, through its clear and decisive order, calls upon companies and their boards to respect foundational statutes and to address lapses not only through payment of penalty but by comprehensive rectification and timely engagement with regulators.
Directors and compliance officers should internalise the message from this case: statutory obligations are not mere paperwork they are the system’s safeguards. Laxity results in financial consequences, reputational harm, and greater scrutiny, whereas proactive compliance ensures sustained credibility and smoother business operations. The right to appeal remains, but the best protection is prevention and ongoing vigilance.
Download MCA Adjudication Order

Contravention of Section 12 of the Companies Act, 2013 Non Capable of Receiving and Acknowledging all Communications and Notices

A company's registered office is not merely a statutory address it is the central hub through which vital communications, legal notices, and regulatory correspondence are directed. Maintaining this office and ensuring its accessibility is a cornerstone requirement of corporate compliance under Indian company law. Section 12 of the Companies Act, 2013, enshrines this principle with clear mandates and prescribes penal consequences for defaults. This brief narrates the recent penalty order delivered by the Registrar of Companies (ROC) Chennai, which found Sonu Infraprojects and Builders Private Limited and its directors in violation of their obligations to maintain a registered office, and illustrates both the substance and significance of strict statutory adherence.

Background and Facts

Sonu Infraprojects and Builders Private Limited, bearing Corporate Identification Number U45200TN2008PTC066363, was incorporated and registered under the Companies Act with its stipulated registered office in Valmiki Nagar, Kanchipuram, Chennai, Tamil Nadu. As of the relevant period in 2023, the company’s directors included Adilakshmi Kancherla (DIN 00907603), Potlapally Lakshmi Sailaja (DIN 01797144), and Narasinga Pakeeraiah (DIN 03146812), all of whom held fiduciary and managerial positions with responsibility for compliance.

The issue originated from an investigation initiated under Section 210 of the Companies Act, 2013, which authorises the Central Government to direct inquiries into the affairs of a company. In this case, the Investigating Officer (I.O.), acting on instructions from the Ministry of Corporate Affairs, sought to determine whether Sonu Infraprojects and Builders Private Limited was properly maintaining its registered office, as mandated by Section 12(1) of the Act. Upon physically visiting the address recorded with the ROC on 6 February 2023, the I.O. found that the registered office did not exist at the stated location; in fact, there was no physical office at all to receive communications or legal notices.

Section 12(1) is unequivocal in its requirement that every company must establish a registered office within thirty days of incorporation and maintain it at all times thereafter. This office must be capable of accepting all statutory communication. The observed breach constituted a clear violation, not only of the procedural aspects of the Act but also its underlying spirit ensuring that companies are reachable and accountable.

Following submission of the Inspection Report, the Ministry directed the ROC to commence penalty proceedings under Section 12(8), which was then triggered by the issue of e-adjudication notice on 20 February 2025. Despite being granted both an opportunity to respond and a separate hearing date on 20 March 2025, the company and all listed directors failed to reply or appear, resulting in ex-parte proceedings as per Rule 3(8) of the Companies (Adjudication of Penalties) Rules, 2014.

Legal Issues Identified

The key legal questions for the adjudicating authority included:

Did the company and its officers breach Section 12(1) and 12(8) by failing to maintain a functioning registered office at the notified address?
What remedial and penal consequences were warranted under the circumstances of continued default, given the absence of cooperation or rectification by the company and its officers?
What obligations followed for all those penalised, both in terms of payment and rectification?
What recourse, if any, did the company and directors retain following the ex-parte order?

Legal Framework and Penalty Principles

Section 12 of the Companies Act, 2013- This Section codifies the statutory requirements for registered offices, emphasising accountability and transparency. It provides that the registered office is to be available for receipt of all communications and legal process, underlining transparency and enabling service of process as well as engagement by regulators, creditors, and stakeholders.
Section 12(8) of the Company Act 2013- This Section explicitly states that any default in maintaining the registered office as required attracts a penalty of Rs.1,000 for every day the default continues, with an upper limit of Rs.1,00,000 per defaulting officer and per company. The law is designed not only for punishment but also deterrence, incentivising ongoing compliance and prompt rectification. Section 454 and the Companies (Adjudication of Penalties) Rules, 2014 provide the procedural tools for the ROC to conduct investigation, offer a hearing, make findings of fact, and enforce penalties.

Adjudication and Findings

The ROC, Chennai, having reviewed the inspection results, the statutory notices, and the failure of the company and its directors to engage in the process, rendered a detailed ex-parte order.

The authority established that:

Sonu Infraprojects and Builders Private Limited was not maintaining its registered office at the address officially filed with the ROC and, as a result, was not meeting statutory mandates under Section 12(1).
Directors Adilakshmi Kancherla, Potlapally Lakshmi Sailaja, and Narasinga Pakeeraiah, each with ongoing managerial and compliance responsibilities, were in default for the same period.
None of the parties offered any defence or evidence of rectification. This combined lack of response and rectification aggravated their liability.

Accordingly, the following penalties were imposed:

Sonu Infraprojects and Builders Private Limited: Rs.1,00,000
Adilakshmi Kancherla: Rs.1,00,000
Potlapally Lakshmi Sailaja: Rs.1,00,000
Narasinga Pakeeraiah: Rs.1,00,000

The directors and company are to pay their respective fines from personal sources, not using company funds for individual penalties. Payment must be made through the Ministry of Corporate Affairs e-Adjudication portal within ninety days from receipt of the order, with proof of compliance to be uploaded accordingly.

Appeal

The adjudicating order clearly outlines recourse for the affected parties. An appeal may be filed before the Regional Director, Chennai, within sixty days of the order’s receipt. The process requires submission of Form ADJ with grounds for appeal and a certified copy of the ROC’s order, in compliance with both Section 454(5)-(6) of the Companies Act and the related penalty rules. This preserves procedural fairness and provides a legal outlet for those wishing to contest the decision or quantum of penalty.

Final Note of the Article

The case of Sonu Infraprojects and Builders Private Limited serves as a salient reminder of the non-negotiable nature of core corporate compliance obligations in India. Failure to maintain a registered office is more than a technical lapse; it is an actionable default that strikes at the heart of transparency and accountability. The ROC, through its clear and decisive order, calls upon companies and their boards to respect foundational statutes and to address lapses not only through payment of penalty but by comprehensive rectification and timely engagement with regulators.

Directors and compliance officers should internalise the message from this case: statutory obligations are not mere paperwork they are the system’s safeguards. Laxity results in financial consequences, reputational harm, and greater scrutiny, whereas proactive compliance ensures sustained credibility and smoother business operations. The right to appeal remains, but the best protection is prevention and ongoing vigilance.