2022 (1) TMI 1018 - Tri - Companies Law

Seeking to restore the name of the Company in the Register maintained by the Respondent/RoC - Section 252 of the Companies Act, 2013 - HELD THAT - It is seen from the balance sheet and invoices and more particularly the bank statement posits the fact that the Company has been active for the period two years preceding the date of strike off and carrying on its business for the purpose of which it was incorporated. As observed from the records produced before this Tribunal, that in order to carry the future business operations, the existence of the Company becomes crucial which also fortifies the 'just' ground being a factor to be considered by this Tribunal in the process of deciding an Application/Appeal under Section 252(3) of the Companies Act, 2013. Taking into consideration the provisions of Section 252 of the Companies Act, 2013 and more particularly the 'just' ground as envisaged under sub-section (3) of Section 252 of the Companies Act, the name of the Petitioner Company in the register maintained by the Respondent is restored, subject to the directions imposed. Application allowed.

Issues:
1. Application for restoration of company name under Section 252 of the Companies Act, 2013 after strike off by Registrar of Companies.
2. Non-compliance of filing annual returns leading to strike off.
3. Grounds for restoration based on company's continued business operations.
4. Evidence submitted by the petitioner to support the claim of active business.

Issue 1: Application for Restoration
The judgment deals with an Application filed under Section 252 of the Companies Act, 2013 by a shareholder seeking restoration of the company's name in the Register maintained by the Registrar of Companies (RoC) after it was struck off.

Issue 2: Non-Compliance Leading to Strike Off
The Company failed to file its balance sheet and annual returns for the period from 2011-2012, resulting in the RoC initiating proceedings under Section 248 of the Companies Act, 2013 and subsequently striking off the company's name from the Register.

Issue 3: Grounds for Restoration
The petitioner argued for restoration based on the company's continued business operations, despite non-compliance due to the demise of key staff members responsible for filings. The RoC objected, stating that such reasons cannot excuse statutory duty non-compliance.

Issue 4: Evidence of Active Business
The petitioner submitted various documents, including balance sheets, bank statements, invoices, and correspondence with government departments, to prove the company's active business operations for the two years preceding the strike off.

The Tribunal considered the evidence presented, noting the company's active business operations and the importance of its existence for future operations. In light of Section 252 of the Companies Act, 2013, the Tribunal ordered the restoration of the company's name in the RoC register. The restoration was subject to conditions, including filing pending returns, paying costs, and restrictions on asset disposal. The order clarified that directors disqualified under Section 164 could not automatically be restored. The petitioner was required to file an affidavit of compliance within two months, and shareholders had to submit an Undertaking regarding financial transactions during demonetization. Importantly, the order did not limit the RoC's power to take action for alleged late filings or non-compliance under the Companies Act, 2013. Ultimately, the Application for restoration was allowed based on the specified terms.

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