2010 (6) TMI 323 - HC - Companies Law

Restoration of the name of the petitioner company to the Register of Companies maintained by the Registrar of Companies Held that - The restoration of the company s name to the Register maintained by the respondent will be subject to the payment of ₹ 1,00,000 as exemplary costs, payable to the common pool fund of the Official Liquidator. In addition, further costs of ₹ 25,000 be paid to the Registrar of Companies. Costs be paid within three weeks from today. 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. The name of the company, its directors and members shall then, as a consequence, stand restored to the Register of the Registrar of Companies, as if the name of the company had not been struck off, in accordance with section 560(6) of the Companies Act, 1956.

Summary

Issues:
1. Restoration of the petitioner company's name to the Register of Companies under section 560(6) of the Companies Act, 1956.
2. Lack of business operations and defaults in statutory compliances leading to striking off the company's name from the Register.
3. Allegations of not receiving show-cause notice and change of registered office address.
4. Time limitation for filing the petition for restoration.
5. Management changes and engagement of Company Secretaries after the company's name was struck off.
6. Pending legal proceedings related to the company's assets.
7. Conditions for revival set by the Registrar of Companies.
8. Interpretation of section 560(6) based on previous judgments.
9. Imposition of costs and exemplary costs for restoration.

Analysis:
1. The petition was filed seeking restoration of the petitioner company's name to the Register of Companies under section 560(6) of the Companies Act, 1956. The Registrar of Companies had struck off the company's name due to defaults in filing annual returns and balance sheets, initiating proceedings under section 560. The company had substantial properties but was not actively conducting business at the time of strike-off.

2. The petitioner alleged not receiving show-cause notice and highlighted discrepancies in the registered office address. The petitioner failed to provide proof of notifying the change of address to the respondent, potentially leading to non-receipt of notices. The petitioners claimed the petition was filed within the limitation period specified by section 560(6).

3. Changes in management were cited, with the day-to-day affairs previously handled by a deceased director. After realizing the non-filing of documents, the petitioners engaged Company Secretaries to address corporate matters. Legal proceedings concerning the company's land were also mentioned as pending.

4. The Registrar did not object to revival if all outstanding statutory documents were filed, along with requisite fees. The Directors provided affidavits of 'No Objection' for restoration. Previous judgments were cited to explain the objective of section 560(6) and the conditions for restoration based on business activities and pending litigations.

5. The judgment imposed exemplary costs and further costs on the petitioners due to the casual handling of statutory compliances and address changes. The restoration was subject to payment of costs, filing of outstanding documents, and completion of formalities. Non-compliance could lead to penal action under section 162 of the Companies Act, 1956. The petition was disposed of with specific conditions for restoration.