2010 (4) TMI 598 - HC - Companies Law

Restoration of the name of the company on the Register of Companies maintained by the Registrar of Companies seeked - Held that - Here, not only have the petitioners been negligent in ensuring regular filing of returns; they have also failed to produce any proof of intimation to the Registrar of Companies about the change in the petitioner company s registered office. The only presumption, therefore, can be that the Registrar of Companies was not properly informed of this fact. Consequently, the petitioner only has itself to blame if it did not receive the notices issued by the Registrar of Companies under section 560 of the Companies Act. The petitioners have, therefore, been remiss in not only in ensuring proper filing of the necessary records but also informing the Registrar of Companies of the change in the registered office. In addition, the publication of the fact that the name of the company has been struck off in the official gazette by the Registrar of Companies, which operates as public notice to all concerned, was also ignored by the petitioners. For these reasons, the petition deserves to be allowed subject to payment of ₹ 22,000 as costs to the Registrar of Companies and further costs of ₹ 11,000 to be deposited in the common pool fund of the Official Liquidator. Costs to be paid within three weeks. Consequently, the restoration of the petitioner s name to the Register maintained by the respondent will be subject to the payment of costs, as aforesaid, and the completion of all formalities, including payment of any late fee or any other charges which are leviable by the respondent for the late deposit of statutory documents.

Summary

Issues:
Restoration of company's name on the Register of Companies under section 560(6) of the Companies Act, 1956 due to defaults in statutory compliances.

Analysis:

Issue 1: Restoration of Company's Name
The petition seeks restoration of the company's name on the Register of Companies as per section 560(6) of the Companies Act, 1956. The company's name was struck off the register by the Registrar of Companies due to defaults in filing balance-sheets and annual returns for specific periods. The Registrar followed the prescribed procedure under section 560, including issuing necessary notices and publishing the company's name in the Official Gazette.

Issue 2: Compliance and Negligence
The petitioner claims the company has been active since incorporation and maintained requisite documentation. However, the company failed to receive show-cause notices or an opportunity to be heard before its name was struck off. The petitioner acknowledges an incorrect registered office address on record but fails to provide proof of address change intimation to the Registrar. The company secretary's negligence in filing returns and informing directors about non-compliance is highlighted.

Issue 3: Limitation Period and Revival
The petition asserts that it falls within the limitation period of 20 years as per section 560(6) of the Companies Act, 1956. The company's accounts were prepared annually, but statutory documents were not filed from 2000 onwards. The company seeks revival with no objection from the respondent, subject to filing outstanding documents and payment of fees.

Issue 4: Court's Decision and Costs
The court acknowledges the need for care in ensuring statutory compliances, emphasizing the management's responsibility. Despite accumulated losses, the court deems restoration necessary in the interest of justice. The petitioners are found negligent in filing returns and informing the Registrar of address change. The court orders payment of costs to the Registrar and the common pool fund due to petitioner's negligence and lack of compliance.

Conclusion:
The court allows the petition for restoration of the company's name on the Register, subject to payment of costs and completion of formalities. The company, directors, and members will be reinstated on the Register as per section 560(6) of the Companies Act, 1956. The respondent is granted liberty to take further action for alleged default in compliance with the Act.