2010 (4) TMI 618 - HC - Companies Law

Restoration of the name of the petitioner company to the Register of Companies seeked - Held that - Looking to the facts, it is possible that notice in respect of action under section 560, Companies Act, 1956, was not sent to the registered office of the petitioner-company. Consequently, the condition precedent for the initiation of proceedings to strike the petitioner s name off the Register of Companies, was not satisfied. At the same time, the petitioner company is stated to be a functioning one, its Director has filed this petition within the stipulated limitation period, and looking to the decision of the Bombay High Court, it is only proper that the impugned order of the respondent, which struck the petitioner s name off the Register of Companies, be set aside. Accordingly, the petition is allowed. The restoration of the petitioner company s name to the Register will be subject to the petitioner filing all outstanding documents required by law and completion of all formalities, including payment of any late fee or any other charges which are leviable by the respondent for the late filing of statutory returns.

Summary

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

Analysis:
The petition was filed seeking restoration of the petitioner company's name in the Register of Companies maintained by the Registrar of Companies under section 560(6) of the Companies Act, 1956. The company was incorporated as a private limited company but had its name struck off the Register due to defaults in filing annual returns and balance sheets for specific periods. The Registrar initiated proceedings under section 560, following the prescribed procedure and issuing necessary notices as per the Act.

The petitioner claimed that the company had been active since incorporation, maintaining required documentation, including audited accounts, income tax returns, and director-related filings. However, the company alleged not receiving any show-cause notice or opportunity to be heard before its name was struck off the Register. It was also revealed that the company's registered office address in the records was incorrect, potentially leading to communication lapses.

The petition was filed within the limitation period specified by section 560(6) of the Companies Act, 1956. The petitioner contended that the company's secretarial staff failed to file necessary documents with the Registrar of Companies, leading to the company's unawareness of its non-compliance until September 2008. The respondent did not object to the company's revival, subject to the filing of outstanding statutory documents and payment of additional fees.

Referring to a Bombay High Court decision, the Court highlighted the objective of section 560(6) to provide an opportunity for companies to revive within 20 years if it serves the interests of justice. Considering the circumstances, including potential non-receipt of notices and the functioning status of the company, the Court allowed the petition, setting aside the order striking the company's name off the Register.

The restoration of the company's name was subject to fulfilling all legal requirements, including filing outstanding documents and payment of fees. The Court granted liberty to the respondent to take penal action against the company for alleged non-compliance with section 162 of the Companies Act, 1956. Ultimately, the petition was disposed of, with the company's name, directors, and members restored to the Register as if it had not been struck off, in line with section 560(6) of the Companies Act, 1956.