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2018 (10) TMI 1739 - HC - Companies LawRestoration of name of petitioner/ company in the Register of Registrar of Companies maintained by them - direction to the petitioner company to file the Audited Financial Statements and Annual Return for the financial year 2009-10 on wards with the respondent - Section 248 of the Companies (Removal of names) Rules, 2016 - HELD THAT - Perusal of the files, produced does not disclose any specific order passed under Section 248 of the Companies Act, 2015, whereas we find only the publication under Sub Section 5 of Section 248 of the Companies, Act, 2015 - From the facts and materials, it could be seen that the petitioner has not filed any appeal, against striking off or against publication of the Gazette notification, but the petitioner company has filed an application under Section 252(3) of the Companies Act, 2013. True that there is an alternative remedy under the NCLT Act, 2013, to prefer an appeal to the Tribunal. But when the error is apparent on the face of record, we are of the view that exercise of power under 227 of the Constitution of India is not ousted. Order has been made on the submission of the petitioner that company has been strike off - Tribunal cannot be found fault with, in placing on record the submission. But the fact remains that, an application under Section 252(3) of the Companies Act, 2013, can be entertained only in a case, where there is an order by which the company is strike off. Legislation if any enacted, providing for an alternative remedy, cannot take away the Constitutional Powers of the High Courts, under Article 226 or 227 of the Constitution of India. High court in exercise of jurisdiction under Article 226 or 227 of the Constitution of India, may not entertain a writ petition, on the ground of availability of an alternative remedy, but the rule cannot have universal application. It is well settled that despite existence of an alternative remedy, still, High Court in exercise of its jurisdiction, entertain a writ petition and pass suitable orders, if it is found that the authority had not acted in accordance with law. In the case on hand, on the premise that there is an order, striking off the company from the register of companies, the petitioner has filed an application under Section 252(3) of the Companies Act, 2013, and orders have been passed, which is impugned in this revision petition - But this Court on perusal of files, has found that there is no order under Section 246(6) of the Act, at all. By inadvertence the petitioner company, was of the view that, there was an order under Section 248(6), of the Companies Act, 2013, and proceeded further whether this Court is denuded of the power under Article 227 of the Constitution of India, to ignore the fundamental error committed by the Registrar of Companies, and direct the petitioner to avail the alternate remedy under Section 252(3) of the Companies Act, 2013, which admittedly, not availed by the petitioner, on the premise that there was an order under Section 248(6) of the Companies Act, 2015. Thus, when there is no order under Section 248(6) of the Companies Act, 2015, passed by the Registrar of Companies, the consequential publication effected under Section 248(5), is not valid. Therefore, it is for the petitioner to take appropriate course - petition disposed off.
Issues Involved:
1. Validity of the striking off of the company from the Register of Companies. 2. Compliance with procedural requirements under Section 248 of the Companies Act, 2013. 3. Availability and appropriateness of alternative remedies. 4. Scope and exercise of jurisdiction under Article 227 of the Constitution of India. Detailed Analysis: 1. Validity of the Striking Off: The core issue revolves around whether the striking off of the company from the Register of Companies was valid. The petitioner company was struck off due to non-filing of statutory returns since 2010. The company argued that the failure was due to the negligence of a part-time accountant and not a willful default. The company had been operational, owning substantial agricultural land and having unsecured creditors. The Tribunal initially rejected the application for restoration, stating there was no plausible reason for revival and suggesting the company could explore winding up. 2. Compliance with Procedural Requirements: The procedural compliance under Section 248 of the Companies Act, 2013, was scrutinized. The Registrar of Companies (RoC) issued notices under Section 248(1) and published the striking off notice in the Official Gazette. However, the High Court noted that there was no specific order passed under Section 248(6) before the publication under Section 248(5). The Court emphasized that an order under sub-Section 6 is mandatory before publication under sub-Section 5. The absence of such an order rendered the striking off process incomplete and procedurally flawed. 3. Availability and Appropriateness of Alternative Remedies: The respondent argued that the petitioner should have appealed to the National Company Law Appellate Tribunal (NCLAT) as per Section 421 of the Companies Act, 2013. However, the High Court held that the existence of an alternative remedy does not oust its jurisdiction under Article 227 of the Constitution, especially when there is a clear procedural error apparent on the face of the record. The Court decided to exercise its supervisory jurisdiction due to the fundamental procedural lapse by the RoC. 4. Scope and Exercise of Jurisdiction under Article 227: The High Court extensively discussed its powers under Article 227 of the Constitution, emphasizing that it can be invoked to correct jurisdictional errors, procedural irregularities, and to ensure justice. The Court cited several precedents affirming its supervisory role over tribunals and lower courts. It concluded that the Tribunal's rejection of the application for restoration was based on an incorrect assumption that the company had been validly struck off. Given the procedural lapse, the High Court deemed it appropriate to intervene and correct the error. Conclusion: The High Court found that the striking off of the petitioner company was procedurally flawed due to the absence of a mandatory order under Section 248(6) of the Companies Act, 2013. Consequently, the publication under Section 248(5) was invalid. The Court exercised its jurisdiction under Article 227 of the Constitution to address the procedural irregularity and directed the petitioner to take appropriate steps in light of the findings. The civil revision petition was disposed of, emphasizing the Court's role in ensuring procedural compliance and justice.
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