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2019 (2) TMI 1048 - AT - Companies LawRestoration of the name of the Petitioner Company in the Register of Companies - Section 248 of Companies Act - Held that - The Impugned Order noted the rival claims and although the scheme was also pointed out to the NCLT, the final part of the Impugned Order simply recorded that the Appellant had on 13.12.2016 itself resolved that application in prescribed form to strike off the name of the Company needs to be filed and observed that it was clear from the report of ROC that the Company was not carrying on business or any operations when the name was struck off and thus, NCLT held that there was no just ground to order restoration of the name of the Company. We find that the NCLT did not consider as to what would be the effect, if the Order remains one of the basis of Section 248(1) and what would be the effect, if it were to be on the basis of Section 248(2). When the scheme was still available, the NCLT could have permitted steps. The declarations given by the Appellant take care of the requirements of Sub-Section (2) of Section 248 that Company may after extinguishing all its liabilities, by a special Resolution, file an application in the prescribed manner to the Registrar for removing the name of the Company from the Register of Companies. Material for satisfaction under Sub-Section (6) of Section 248 was also available to ROC. When the Appellant filed the Resolution with the Registrar of Companies on 8th February, 2017, if the Form STK 2 was not available to the public, the Appellant cannot be held responsible and in the circumstances, it would not be appropriate for the Respondent to stand on technicalities and resist efforts of the Appellant to take benefit of the provisions under Section 248(2) and even the Scheme of 2018. There is no reason why the Respondent should not have approached the matter more sympathetically. In the present matter, we already have the compliances in place and the fees are stated to have been paid by demand drafts. The special Resolution is already there. The filings and application are stated to have been filed. In such situation, it would be appropriate to order the striking off, of the Company to be on the basis of Sub-Section 248(2) instead of Section 248(1) - appeal allowed.
Issues Involved:
1. Restoration of the company's name in the Register of Companies. 2. Compliance with Section 248 of the Companies Act, 2013. 3. Application of the Condonation of Delay Scheme, 2018. 4. Validity of the Registrar of Companies' actions under Section 248(1) versus Section 248(2). Issue-wise Detailed Analysis: 1. Restoration of the Company's Name in the Register of Companies: The appellant filed CP 35/BB/2018 under Section 252 of the Companies Act, 2013 before the National Company Law Tribunal (NCLT), Bengaluru Bench, seeking restoration of the company's name in the Register of Companies. The NCLT dismissed the petition on 3rd April 2018, leading to the present appeal. The appellant argued that they had passed a special resolution on 13th December 2016 to strike off the company's name under Section 248 of the Companies Act, 2013, and had attempted to file the necessary Form STK 2, which was not available on the Ministry of Corporate Affairs website until 5th April 2017. Consequently, they uploaded the resolution in Form MGT 14 on 8th February 2017. 2. Compliance with Section 248 of the Companies Act, 2013: Section 248 outlines the power of the Registrar to remove a company's name from the register if the company fails to commence business within one year of incorporation or if it is not carrying on any business or operation for two immediately preceding financial years without applying for dormant status. The appellant contended that they had complied with Section 248(2) by passing a special resolution and filing it with the Registrar. The Registrar issued a notice under Section 248(1) on 27th March 2017, stating the intention to remove the company's name due to inactivity. The appellant responded on 27th April 2017, confirming the company's inactivity and lack of liabilities, assets, or pending inquiries. 3. Application of the Condonation of Delay Scheme, 2018: The Ministry of Corporate Affairs introduced the Condonation of Delay Scheme, 2018, to provide relief to defaulting companies and their directors from disqualification under Section 164 of the Companies Act, 2013. The scheme allowed defaulting companies to file overdue documents and seek revival. The appellant filed the petition under Section 252 on 22nd January 2018, within the scheme's applicability period. The appellant argued that the NCLT should have considered the scheme and provided the benefit to the appellant. 4. Validity of the Registrar of Companies' Actions under Section 248(1) versus Section 248(2): The appellant argued that the Registrar should have considered their application under Section 248(2) instead of Section 248(1). The appellant had passed a special resolution and filed it with the Registrar, and had also responded to the notice under Section 248(1). The appellant contended that the Registrar's action under Section 248(1) led to the directors' disqualification under Section 164. The NCLT did not consider the impact of the order under Section 248(1) versus Section 248(2) and dismissed the petition without addressing the scheme's applicability. Judgment: The tribunal noted that the appellant had complied with the requirements of Section 248(2) by passing a special resolution and filing it with the Registrar. The tribunal also acknowledged that the Condonation of Delay Scheme, 2018, was applicable to the appellant. The tribunal found that the NCLT had not considered the scheme and the appellant's compliance with Section 248(2). The tribunal set aside the NCLT's order and declared that the striking off of the appellant company would be treated under Section 248(2) of the Companies Act, 2013, instead of Section 248(1). The tribunal ordered the Registrar to accept the documents filed by the appellant and provide the benefit of the scheme. Order: The appeal was allowed, and the impugned order was set aside. The tribunal declared that the striking off of the appellant company would be treated under Section 248(2) of the Companies Act, 2013. No orders as to costs.
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