The Ministry of Corporate Affairs (MCA) has taken a decisive step in enforcing gender diversity regulations by penalising S.S. Forgings and Engineering Limited for failing to appoint a woman director on its board. This requirement is mandated under Section 149 of the Companies Act, 2013. This act of a company penalised for no women director is something that sends a clear message: corporate governance cannot remain an old boys’ club.
The case of this Maharashtra-based public company is not an isolated one. It highlights a deeper systemic issue in Indian corporate culture, where compliance with diversity norms is often treated as an afterthought rather than a foundation of good governance. This fine is more than a slap on the wrist; it is a signal that inclusion must now be a corporate imperative.
The violation that triggered the fine
S.S. Forgings was in breach of the law from July 1, 2022, to March 28, 2023, which is a total of 270 days. This is despite meeting both qualifying thresholds under Section 149: a paid-up capital of ₹7.8 crore and a turnover nearing ₹6 crore. This placed the company squarely within the bracket required to appoint at least one woman director.
The Registrar of Companies, B. Mishra, rejected the company’s justification and labelled the lapse a “serious breach,” citing not just non-compliance but disregard for corporate responsibility. The fine imposed under Section 454 of the Act amounted to ₹2.85 lakh. It is a significant move to hold companies accountable to the letter of the law.
Section 149: What the law really says
Section 149(1) of the Companies Act is more than just legal jargon. It is a landmark provision introduced in 2013 to promote better representation of women in corporate leadership. It mandates that every listed company and certain classes of public companies must have at least one woman director on the board.
This move was part of a broader set of corporate governance reforms aimed at bringing diversity, transparency, and inclusion into decision-making processes at the highest levels. Yet, more than a decade later, compliance remains alarmingly inconsistent, particularly in industries dominated by legacy mindsets.
Company penalised for no women director: A case of systemic oversight, not ignorance
What makes this case even more concerning is that S.S. Forgings cannot plead ignorance. The company’s financial records and long-standing incorporation status show clear eligibility for the provision. It was not a grey area; it was deliberate inaction.
The adjudicating officer rightly noted that the firm’s failure to appoint a woman director “reflected systemic governance oversight.” It is a reminder to corporate India that inclusive policies are not window dressing; they are legal and ethical obligations.
Company penalised for no women director: Why this matters
The fine is symbolic, but it is also precedent-setting. While many companies have complied with the women director mandate on paper, very few have gone beyond tokenism. Women are often added to boards for optics, without being empowered with real decision-making authority.
This move by the MCA should spark introspection: Is your company promoting women to leadership because the law mandates it, or because they deserve a seat at the table?
Boardrooms need diverse voices not only because of regulation but also because companies perform better when leadership reflects varied perspectives. From crisis management to ESG alignment, gender-diverse boards are no longer a “good to have”; they are a business imperative.
Will more companies be held accountable?
This action could open the door for further regulatory enforcement. If other firms are found flouting the rule, especially after the long grace periods already granted, they may soon face similar penalties.
The Companies Act does not just impose obligations; it also provides clarity. And now, with a real-world fine in the books, it sets an expectation: excuses will no longer cut it. The days of all-male boards in qualifying companies should be behind us.
Company penalised for no women director: The final verdict
This case is a turning point. It is a reminder that compliance is not enough. Instead, companies must be proactive. Regulatory bodies are watching, and inaction will have consequences.
If your board still lacks gender diversity, the clock is ticking. The future of leadership—like the future of India Inc—must be inclusive.
Changeincontent perspective
At Changeincontent, we have long argued that authentic leadership means going beyond symbolic representation. During our #NoWomensDay campaign, we challenged performative acts of gender equality and called for structural change. This penalty issued by MCA aligns with that vision.
We have previously highlighted how companies in mining and manufacturing are breaking norms by onboarding women not just as employees but as leaders. This story flips the spotlight, showing what happens when companies refuse to evolve.
If the law demands inclusion and the data supports it, what exactly are we still waiting for?
Disclaimer: The views expressed in this article are based on the writer’s insights, supported by data and resources available both online and offline, as applicable. Changeincontent.com is committed to promoting inclusivity across all forms of content. We broadly define inclusivity as media, policies, law, and history, encompassing all elements that influence the lives of women and marginalised individuals. Our goal is to promote understanding and advocate for comprehensive inclusivity.
