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2020 (11) TMI 291 - Tri - Companies LawRestoration of the name of the Company in the Register of Companies - Section 252(3) of the Companies Act, 1956 - HELD THAT - The Appellant has submitted sufficient evidence that it has been in operation since incorporation and during the period preceding strike off, therefore it could not be termed as a defunct company as per section 252 of the Act. Thus, taking into consideration the provisions of Section 252(1) of the Companies Act, 2013 which vests this Tribunal with a discretion where the Company, whose name has been struck off, and such Company is able to demonstrate that there is a running business as on the date when the name was struck off and also keeping in consideration that it is just to do so, can restore the name of the Company, in the Register and in the interest of all stakeholders, including the Appellant itself, who seeks restoration of the name of the Company in the register maintained by Registrar of Companies, the company deserved to be restored. The Public Notice of Registrar of Companies, striking off the name of the company is hereby declared illegal and set aside - Appeal allowed.
Issues:
Appeal against striking off company's name under Section 252(3) of the Companies Act, 1956. Analysis: The appeal was filed against the order of striking off the company's name by the Respondent under Section 248(1) of the Companies Act, 1956. The Appellant argued that the company was incorporated as a Private Limited Company and had its registered office in New Delhi. The company's share capital, main objects, and details of operations were presented. The Respondent initiated the striking off action due to the company's failure to file Annual Returns and Balance Sheets for multiple financial years. The Appellant contended that the company was active and operational during the period of striking off, but due to inadvertence, the necessary filings were not made. Evidence such as financial statements, agreements, and tax returns were provided to support the claim of ongoing operations. The Respondent's stance was that the company did not carry out any operations for two preceding financial years and did not obtain the status of a Dormant Company as per Section 455 of the Companies Act, 2013. The Income Tax Department's submission highlighted issues related to the company's tax filings and alleged involvement in accommodation entry transactions. The Department requested the directors to attend proceedings and provide asset details, along with filing an undertaking regarding asset sales. The Tribunal considered the grounds under Section 252 of the Companies Act, 2013, and the Appellant's evidence of continued operations to restore the company's name. The Tribunal allowed the appeal, declaring the striking off of the company's name as illegal and ordering its restoration to the Register of Companies. The restoration was subject to fulfilling outstanding document filings, payment of fees, charges, and costs, including a contribution to the Prime Minister's Relief Fund. The Income Tax Department's requests for proceedings attendance and asset details were also addressed in the order. The judgment concluded by disposing of the appeal and directing the service of the order to the involved parties.
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