PROSECUTION AND PENALITY FOR NON-COMPLIANCE
Where the company has defaulted under section 156 and/or 210 of the Companies Act, 1956 that is, where they have not held the annual general meeting and/or have not placed the balance sheet and the profit and loss account before the AGM, prosecutions are rarely launched. The fact that the complaint has to be filed in the Court .
Section 168 contains penal provision for not complying with the provisions of section 166 or 167. It provide that if default is committed in holding the AGM of the Company, the company and every officer of the company who is in default shall be punishable with fine which may extended to Rs. 50,000 and if sefault is continuing one then with further fine extending upto Rs. 2500/- for every day after the first day during which the default continues.
However, if books of account have been ceased by the police and produced in criminal curt, the default is beyond control of the company and should not be punishable.
Failure to hold the meeting in each calendar years is a separate offence different from failure to hold it within 15 months of the earlier meeting.
In State of Kerela v. West Coast Planters Agencies (P) Ltd. (1985) it was held that where there was a single member in the company then not holding the AGM would not amount to a default.