SAME PERSON NOT TO CONTINUE AS CFO AND WHOLETIME DIRECTOR

 The ROC Gwalior adjudication order (Order ID: PO/ADJ/06-2026/GL/02450, dated 29/06/2026) issued against EKI Energy Services Limited addresses the following violation, company rationale, and regulatory findings

The Non-Compliance (Contravention)

• Statutory Violation: Contravention of Section 203(1), penalized under Section 203(5) of the Companies Act, 2013.

• Core Issue: The company appointed Mr. Mohit Kumar Agarwal (who was already serving as the Chief Financial Officer) as an Additional Director designated as a Whole-Time Director (WTD), while permitting him to simultaneously continue holding the office of Chief Financial Officer (CFO) without appointing a separate person to the post of CFO.

• Company's Stand & Reason for Non-Compliance

  • Absence of Express Prohibition: The company argued that the Companies Act, 2013 contains no explicit statutory bar prohibiting one individual from holding the dual offices of Whole-Time Director and Chief Financial Officer concurrently.

  • Industry Practice: The noticees pointed out that similar concurrent appointments are commonly followed by other companies in corporate practice.

  ROC's Rebuttal & Regulatory Rationale

  The Adjudicating Officer rejected the company's defense on the following grounds:

  • Segregation of Key Functions: Section 203(1) envisions distinct classes of whole-time Key Managerial Personnel (KMP) entrusted with separate statutory responsibilities. The legislative intent is to mandate structural segregation of duties and accountability within the corporate governance framework.

  • Defeat of Statutory Purpose: Permitting the same individual to simultaneously occupy the positions of WTD and CFO—without appointing another person to perform the CFO’s duties—defeats the statutory mandate requiring whole-time KMP appointments.

  • Prevalence Does Not Create Legality: The ROC held that the existence of similar practices in other companies cannot legitimize an arrangement that is inconsistent with the statutory framework of the Act.

  • Penalties Imposed

    • EKI Energy Services Limited: ₹5,00,000.

    • Manish Kumar Dabkara (Managing Director / Designated Officer in Default): ₹50,000 (to be paid from personal sources).

    • Other Directors / Noticees: ₹0 penalty, as the company had formally designated the Managing Director as the Officer in Default under Section 2(60) via Form GNL-3.