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2019 (10) TMI 1398 - HC - Companies LawDisqualification of Directors under Section 164(2)(a) of the Companies Act - Restoration of the name of the Company in the Register of Companies - non-filing of the financial statements and the annual returns - section 248(5) of the Companies Act - whether the petition under section 463(2) of the Companies Act, 2013, is maintainable in respect of the order of disqualification? - HELD THAT - The petition has not been filed on reasonable apprehension of prosecution but filed in respect of disqualification that had already came in to force. In addition, it may be noticed that no show cause notice has been issued in respect of non-filing of the financial statements or non- filing of the annual returns. As such, there is no reason to exercise discretionary jurisdiction under section 463(2) of the Companies Act - the company has been directed to file all pending financial statements and annual returns with the Registrar of Companies. Therefore, it is always open to the Company and its ex-directors to approach the NCLT if any difficulty is experienced in ensuring that the financial statements and the returns are taken on file. Petition dismissed.
Issues:
Petitions under section 463(2) of the Companies Act to relieve petitioners from disqualification under Section 164(2)(a) of the Companies Act. Analysis: The petitioners filed petitions under section 463(2) of the Companies Act seeking relief from disqualification under Section 164(2)(a) of the Companies Act. The Company had been struck off from the Registrar of Companies due to non-filing of financial statements and annual returns. Subsequently, the NCLT directed the restoration of the Company's name and filing of pending documents. The petitioners attempted to comply by remitting the requisite fees but were denied due to being disqualified directors. They feared prosecution under relevant sections of the Companies Act and sought relief from disqualification. The Standing Counsel for the Registrar of Companies argued that the petitioners, not being officers of the Company, were not entitled to maintain the petition under section 463(2) of the Companies Act, citing a previous court order. The High Court examined the records and oral submissions to determine the maintainability of the petition. The central issue for consideration was whether a petition under section 463(2) of the Companies Act is maintainable concerning the disqualification order. Referring to a previous court order, the High Court concluded that such a petition is not maintainable once disqualification has taken effect under the statutory provision. The court found that the petition was not based on a reasonable apprehension of prosecution but rather on disqualification that had already come into force. Additionally, no show cause notice had been issued regarding non-filing of financial statements or annual returns, leading the court to decline the exercise of discretionary jurisdiction under section 463(2) of the Companies Act. The High Court highlighted that the NCLT had directed the Company to file all pending financial statements and annual returns with the Registrar of Companies, allowing the Company and its former directors to approach the NCLT if faced with difficulties in filing the required documents. Consequently, the court dismissed the petitions, subject to the observation that there was no current need to exercise discretionary jurisdiction under section 463(2) of the Companies Act.
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