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2023 (2) TMI 616 - AT - Companies LawSeeking restoration of the name of the Company in the Register maintained by the Registrar of Companies (RoC), NCT of Delhi and Haryana - HELD THAT - In view of the fact that the Financial Statements for the Financial Years of 2004-05, 2005-06, 2006-07, 2007-08, 2008-09, 2009-10, 2010-11, 2011-12, 2012-13, 2013-14, 2014-15, 2015-16, 2016-17 2017-18 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 (Court-V, New Delhi) as well as Registrar of Companies, NCT of Delhi Haryana is not sustainable in law. The name of the Appellant Company be restored to the Register of Companies subject to the compliances imposed.
Issues:
1. Appeal under Section 421 of the Companies Act, 2013 against the order of the National Company Law Tribunal (NCLT) dismissing the appeal for restoration of a company's name in the Register maintained by the Registrar of Companies. 2. Whether the company's name was rightfully struck off by the Registrar of Companies. 3. Compliance with statutory requirements for restoration of the company's name. 4. Financial implications and consequences of the company's name being struck off. Issue 1: The Appellants filed an appeal under Section 421 of the Companies Act, 2013, challenging the NCLT's order dismissing the appeal for restoration of the company's name in the Register maintained by the Registrar of Companies. The company, incorporated in 1987, had its name struck off in 2007. The Appellants argued that the Tribunal erred in not considering due procedure and the company's efforts to resolve internal disputes before seeking restoration. Issue 2: The Respondent, Registrar of Companies, stated that no records of annual returns or balance sheets were submitted since the launch of the MCA-21 portal in 2006. The company's name was struck off in 2007 due to pending audited financials, indicating non-operation. However, the company later submitted the pending audited financials with the application for restoration. Issue 3: After hearing both parties, the NCLAT found that the company had substantial assets and was carrying on business operations despite the name being struck off. The NCLAT set aside the NCLT's order and directed the restoration of the company's name in the Register subject to certain conditions. The company was required to pay costs, file all pending annual returns and balance sheets, and comply with other statutory requirements. Issue 4: The financial implications of the company's name being struck off were significant, as it affected the company's legal status and ability to conduct day-to-day operations. The Appellants argued that the delay in filing statutory documents was unintentional, and they were unaware of the notification regarding the striking off. The Respondent agreed to restoration if the company complied with specified conditions, acknowledging the need for restoration to prevent irreparable loss to stakeholders. In conclusion, the NCLAT allowed the appeal, setting aside the NCLT's order and directing the restoration of the company's name in the Register. The judgment emphasized the importance of compliance with statutory requirements and recognized the company's efforts to resolve internal disputes and continue its business operations. The restoration was subject to the company fulfilling specified conditions, including payment of costs and filing of pending documents, to ensure legal status and protect stakeholders' interests.
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