2022 (12) TMI 919 - AT - Companies Law

Restoration of the name of the Appellant Company in the Register maintained by the Registrar of Companies (RoC) - Section 252 of Companies Act - HELD THAT - In view of the fact that the sale deeds executed in favour of the Appellant Company and Audited Balance sheet from Financial Year 2011-12 to 2018-19 of the Appellant Company shows that the Appellant Company is having substantial movable as well as immovable assets. Therefore, it cannot be said that the Appellant Company is not carrying on any business or operations. Hence, the order passed by the National Company Law Tribunal (Cuttack Bench, Cuttack) as well as Registrar of Companies, Chhattisgarh is not sustainable in law. The name of the Appellant Company be restored to the Register of Companies subject to the compliances imposed - appeal allowed.

Summary

Issues:
- Appeal under Section 421 of the Companies Act, 2013 against the order of National Company Law Tribunal (NCLT) dismissing the appeal for restoration of the company's name in the Register maintained by the Registrar of Companies (RoC).

Detailed Analysis:

Issue 1: Non-compliance leading to striking off the company's name
- The Appellant, a Shareholder/Director of a Private Limited Company, failed to file Financial Statements & Annual Returns for the years 2011-12 to 2015-16, resulting in the RoC striking off the company's name.
- The Appellant Company, located in a remote area, cited lack of professional guidance initially for non-compliance.
- The Appellant Company had operations in 2013-14 but failed to file Income Tax Returns until 2018-19.

Issue 2: Tribunal's decision and grounds of appeal
- The Tribunal dismissed the petition for restoration, prompting the appeal.
- The Appellant argued that the non-filing of annual returns was inadvertent and not intentional, emphasizing the adverse impact on stakeholders.
- The Appellant submitted sale deeds and expressed readiness to comply with all conditions and pay penalties.

Issue 3: Respondent's stance and legal proceedings
- The RoC stated the Appellant failed to file Annual Returns and Balance Sheets for several years.
- Notices were issued to the company and directors, but no response was received, leading to the company's name being struck off.
- The RoC highlighted Ministry directions and legal requirements for restoration.

Issue 4: Appellate Tribunal's decision
- After reviewing documents and submissions, the Appellate Tribunal found the Appellant Company possessed substantial assets, indicating ongoing business operations.
- The Tribunal set aside the NCLT's order, restoring the company's name with specified conditions and compliance requirements.
- The Appellant was directed to pay costs, file pending returns, and adhere to statutory obligations within specified timelines.

Conclusion:
- The Appellate Tribunal allowed the appeal, restoring the company's name in the Register subject to compliance with specified conditions and obligations.
- The decision emphasized the Appellant Company's assets and ongoing business activities as grounds for restoration, overturning the NCLT's dismissal of the restoration petition.