Disclosure of Prevention of Sexual Harassment (POSH) in Director’s Report


The Ministry of Corporate Affairs has now brought out a new disclosure required to be made in the Director’s report. This new disclosure requirement is in line with the Sexual Harassment (Prevention, Prohibition and Redressal) Act, 2013.

What are the disclosure to be made ?

With its notification dt. 31st July 2018, the Ministry of Corporate Affairs has made it mandatory for the companies to insert the following clause X after Rule 8(5)(viii) –

A statement that the company has complied with the provisions relating to the implementation of an internal complaints committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 .

From when is the above notification effective?

The above notification will be effective from 31st July 2018.

Applicable to whom ?

The above disclosure is not applicable to:

  • OPC – One Person Company

  • Small Company – a company where the capital is less than ₹ 50 lakh and the turnover is less than ₹ 20 crore.

This means the above disclosure is to be complied with all other companies other than OPC and Small company

What is the penalty for Non-Disclosure ?

Sec. 134 of the Companies Act, 2013 governs the disclosures to be made in the Director’s report. The penalty for non-disclosure is

  • Company will be imposed with fine, ranging from ₹50,000 to ₹25,00,000.

  • The directors will be punished with imprisonment for a tenure of 1 year to 3 years and a fine, ranging from ₹50,000 to ₹5,00,000.

Disclaimer:"The information contained herein is only for informational purpose and should not be considered for any particular instance or individual or entity. We have obtained information from publicly available sources, there can be no guarantee that such information is accurate as of the date it is received or it will continue to be accurate in future. No one should act on such information without obtaining professional advice after thorough examination of particular situation."

Prepared By

Sindhu Kini M

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