V-Guard Fined Over ₹2 Lakh By Registrar Of Companies

V-Guard Industries has been fined ₹2.03 lakh by the Registrar of Companies (ROC), Kerala, for violating provisions of the Companies Act, 2013. The penalty, imposed on the company’s Managing Director, Mithun K Chittilappilly, followed a suo-moto application filed by the company itself. The issue stemmed from non-compliance with Section 152(6), which mandates the rotation of directors in public companies.

The problem arose during V-Guard’s 2022 Annual General Meeting (AGM), where the retirement and reappointment of directors did not follow statutory guidelines. Out of the two executive directors, one was from the promoter category and designated as Managing Director, and the other was a professional Director and Chief Operating Officer. While the Managing Director’s position was not subject to rotation, the company was required to retire and reappoint other directors as per the Companies Act. However, the non-executive, non-independent director chose not to seek reappointment at the AGM, leading to a breach in compliance.

V-Guard Fined Over ₹2 Lakh By Registrar Of Companies

To address this issue, V-Guard’s Board of Directors appointed an additional executive director in May 2023, ensuring future compliance with the Act. The ROC found that this corrective action came too late, and imposed the fine. The penalty includes ₹50,000 for the initial non-compliance and an additional ₹1.53 lakh for the continued default.

The company, while acknowledging the adjudication order, has stated that the fine will not have any material impact on its financial operations. V-Guard has 90 days to settle the penalty and can appeal the order within 60 days if it chooses to contest the decision.

V-Guard Industries is an Indian electronics and electricals manufacturer, headquartered in Kochi, Kerala. Founded in 1977 by Kochouseph Chittilappilly, the company initially started as a small-scale enterprise producing voltage stabilizers. Over the years, V-Guard expanded its product portfolio to include a range of electrical and electronic goods such as water heaters, pumps, solar water heaters, inverters, batteries, and fans. It has built a strong market presence across India, particularly in the southern region, known for its reliable and energy-efficient products.

The company is publicly listed on the stock exchanges in India and has consistently demonstrated robust growth. V-Guard places a high emphasis on innovation, quality, and customer satisfaction, maintaining a network of over 500 distributors and 40,000 retailers across the country.