2020 (12) TMI 840 - Tri - Companies Law

Restoration of name of the Company in register of companies - restoration of original status of the Respondent Company, directors and all other stakeholders as if the name of the Company has not been struck off from the Register of Companies - section 252(3) of the Companies Act, 2013, read with rule 87A of the National Company Law Tribunal Rules, 2016 - HELD THAT - This Tribunal is of the opinion that it would be just and proper to order restoration of name of the 2nd Respondent Company in the Register of Companies. In view of the averments made and evidence placed, refusal to restore will be an excessive penalty for the over-sight on the part of the 2nd Respondent Company. The Applicant shall file all the pending Financial Statements and Annual Returns with RoC as per the Act and Rules made thereunder. It shall also comply with the provisions of the Companies Act, 2013 without any delay in future. Form INC 28 shall also be filed as per procedure - Further the Applicant is directed to pay the cost of ₹ 25,000/- to the RoC while submitting the documents. This is for the expenses to be incurred by RoC for publication in the Official Gazette and for other related expenses. Application allowed.

Summary

Issues:
- Restoration of company name in register of companies under Section 252(3) of the Companies Act, 2013
- Restoration of original status of the company, directors, and stakeholders
- Publication of the tribunal's order in the official Gazette

Analysis:

Restoration of Company Name:
The Company Application sought restoration of the 2nd Respondent Company's name in the Register of Companies under Section 252(3) of the Companies Act, 2013. The Applicant, a shareholder, highlighted that the company was incorporated as a private limited company and had successfully completed residential construction projects. However, due to non-filing of financial statements and annual returns for nine years, the Registrar of Companies initiated action under Section 248, resulting in the company's name being struck off. The Applicant submitted financial statements, income tax returns, and a Demonetization Affidavit to demonstrate compliance and good faith. The Registrar of Companies raised objections regarding non-filing of financial statements, lack of business activities, and non-compliance with tax filings.

Restoration of Original Status:
The tribunal, after considering the pleadings and evidence, found that the company was a going concern and ordered the restoration of the company's name in the Register of Companies. The tribunal emphasized that refusal to restore the name would be excessive given the circumstances and directed the Applicant to file all pending financial statements and annual returns in compliance with the Companies Act, 2013. Additionally, the Applicant was instructed to pay a cost of ?25,000 to cover expenses related to the restoration process. The tribunal's decision aimed to rectify the oversight on the part of the company and enable it to fulfill its statutory obligations in the future.

Publication in Official Gazette:
As part of the relief sought, the tribunal directed the 1st Respondent (Registrar of Companies) to restore the name of the 2nd Respondent Company in the Register of Companies. The Applicant was given 30 days to comply with the order and ensure the implementation of the restoration. The tribunal's decision effectively disposed of the Company Application, providing a comprehensive resolution to the issues raised regarding the company's status and compliance with regulatory requirements.