Ina Malhotra, Member - (1.) The petitioners have filed this application u/s. 621A of the Companies Act, 1956 praying for compounding of the offence u/s. 297 (1) of the Companies Act. The said petition has been routed through the office of the RoC along with their comments. The company did not obtain approval of the Board of Directors for entering into related party transactions. The company had entered into agreement with the Vaishnavi Advisory Services Pvt. Ltd. on 01.09.2010 (Related Party No. 1) for rendering the Business Support Services in form of infrastructure to the company at their premises situated in the Noida for the period 01.09.2010 to 31.08.2013. At that time, three of the Directors, viz. Ms. Niira Radia, Ms. Karuna Menon and Shri Vishal Bhushan Mehta were also Directors of Related Party No. 1. Further, the company also entered into an agreement with M/s. Leisure Club India Pvt. Ltd. (Related Party No. 2) for rendering services for infrastructure for the period 01.07.2010 to 30.06.2011. At the time of execution of this agreement dated 01.04.2010, Ms. Karuna Menon was a common Director of both the companies.
(2.) As the consent of the Board of Directors was not obtained, the SFIO has instituted prosecution for violating the provisions of Section 297(1) of the Companies Act.
(3.) The period of default is stated to be from 01.09.2010 to 31.03.2012 with Related Party No. 1 and 01.04.2010 to 30.06.2011 with Related Party No. 2.;