2017 (1) TMI 60 - HC - Companies Law

Restoration of company name - provisions of sub-section (1) & (2) of Section 560 of the Companies Act have not been complied with by the respondent authority before striking off the name of petitioner company from its register - Held that - In view of submission of learned counsel for the parties and, in view of the admitted fact, that the provisions of sub-section (1) & (2) of Section 560 of the Companies Act have not been complied, it is just and proper to restore the name of the company in the register of the Registrar of Companies. It is hereby directed that the name of the petitioner company be restored in the register of the Registrar of the Companies and the notification published in respect of petitioner-company would stand set aside. Since the name of the petitioner company was notified in the gazette way back in the year 2010 and six years have elapsed since then, therefore, a cost of ₹ 75,000/- (Rupees Seventy Five Thousand only) is imposed on the petitioner, which shall be deposited in the account of the Registrar of Companies, Uttarakhand (respondent no.2) within a period of six weeks from today.

Summary

Issues:
1. Compliance with Section 560 of the Companies Act before striking off a company's name from the register.
2. Restoration of the petitioner company's name in the register.
3. Imposition of costs on the petitioner for the delay in restoration.

Compliance with Section 560 of the Companies Act:
The petitioner approached the court seeking to quash a Gazette Notification related to the striking off of their company's name from the register. The court noted that Section 560 of the Companies Act outlines the procedure for striking off a defunct company's name. It requires the Registrar to send letters inquiring about the company's status, followed by a notice in the official gazette if no response is received. The petitioner argued that the Registrar did not comply with these provisions before striking off their company's name. The respondents admitted to the non-compliance, leading to a concession by the court.

Restoration of the petitioner company's name:
In light of the admitted non-compliance with Section 560 of the Companies Act, the court decided to restore the petitioner company's name in the register. The court referenced a similar case where restoration was ordered and decided to grant the same relief to the present petitioner. The court directed the Registrar of Companies to restore the name of the petitioner company and set aside the previous notification regarding the company's status.

Imposition of costs on the petitioner:
Considering that the Gazette Notification striking off the company's name was issued in 2010 and six years had passed, the court imposed a cost of ?75,000 on the petitioner. The petitioner was instructed to deposit this amount with the Registrar of Companies in Uttarakhand within six weeks. The court disposed of the writ petition accordingly, concluding the legal proceedings.