2020 (12) TMI 645 - Tri - Companies Law

Restoration of name of the Company on the Register of Companies maintained by the Registrar of Companies - section 252 of the Companies Act, 2013, R/w Rule 87A of the NCLT (Amendment) Rules, 2017 - HELD THAT - It is not in dispute that the Registrar of Companies is conferred with power U/s. 248(1) to strike off the Company, if the Company has failed to commence its business within one year of its incorporation or a Company is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any Application within such period for obtaining the status of a dormant Company U/s. 455. However, Section 248(6) states that the Registrar of Companies, before finally striking off Company, has to satisfy himself that sufficient provision has been made for the realization of all amounts due to the Company and for the payment or discharge of its liabilities and obligations by the Company within a reasonable time, and, if necessary, obtain necessary undertakings from the Managing Director, Director or other persons in charge of the management of the Company. Though the impugned striking off the Company was in accordance with law, the Tribunal has to take into consideration of bona fide contentions of Petitioners seeking to restore name of Company, by taking a lenient view of the issue in the interest of justice and ease of doing business, instead of rigidly interpreting the law on the issue. It is also not in dispute that the instant Company Petition is filed in accordance with law; there are no investigations pending against the Company; the Respondent has not opposed the Petition; and left the issue to Tribunal to consider the case subject terms and conditions. Therefore, the interest of justice would be met if the name of Company is restored as prayed for, however, subject to conditions mentioned. The name is restored - application allowed.

Summary

Issues Involved:
1. Restoration of the Company's name in the Register of Companies.
2. Compliance with statutory requirements and filing of pending documents.
3. Payment of costs and fines for restoration.
4. Legal consequences and further actions by the Registrar of Companies.

Detailed Analysis:

Restoration of the Company's Name:
The primary issue is the restoration of the name of M/s. Terminus Park India Private Limited to the Register of Companies. The Company was struck off by the Registrar of Companies, Karnataka, under Section 248 of the Companies Act, 2013, due to non-filing of Balance Sheets and Annual Returns from the financial year 2014-2015 onwards and the belief that the Company had not carried on any business or operations for the preceding two financial years. The Petitioner argued that the non-filing was neither intentional nor deliberate but due to financial constraints, litigation, and lack of awareness of compliance requirements. The Tribunal considered these bona fide contentions and, following the principle of ease of doing business, decided to restore the Company's name, subject to compliance with certain conditions.

Compliance with Statutory Requirements:
The Tribunal directed that the Company must file all statutory documents, including Financial Statements and Annual Returns for the financial years 2014-15 to 2018-19, along with the prescribed fees, additional fees, and fines within 30 days from the restoration of its name in the Register of Companies. The Petitioner is also required to ensure compliance with this order personally.

Payment of Costs and Fines:
The Tribunal imposed a cost of ?30,000 to be paid online to the account of the Central Government in favor of the Pay & Accounts Officer, Ministry of Corporate Affairs, Southern Region, Chennai, within three weeks from the date of receipt of the order. Failure to comply with this payment would result in the lapse of the restoration order.

Legal Consequences and Further Actions:
The Tribunal clarified that this order is confined to the violations that led to the striking off the Company and does not preclude the Registrar of Companies from taking appropriate actions for any other violations or offenses committed by the Company before or during the period it was struck off. The Company is also directed to resume its business operations as expeditiously as possible after the restoration.

Conclusion:
The Tribunal, exercising its powers under Section 252(3) of the Companies Act, 2013, ordered the restoration of M/s. Terminus Park India Private Limited to the Register of Companies, subject to the fulfillment of specific conditions, including the filing of pending statutory documents and payment of costs. The decision was made in the interest of justice and ease of doing business, considering the bona fide reasons for non-compliance presented by the Petitioner.