2024 (2) TMI 510 - AT - Companies Law

Revival of the Appellant / Company - Removal the company for non-filing of Annual Return - Going Concern or not - Misinterpretation of meaning and purport of Liberty granted to the Appellant - disregard by Tribunal of clear liberty granted to the Appellant by the Hon ble High Court, by holding that since the Company petition was not pending, there was no question of receiving additional documents in a disposed of petition/proceeding - HELD THAT - The power of a Tribunal to permit Additional evidence to produce / documents is in the jurisdiction of the Appellate Authority. A document not relevant for deciding the question of controversy in a given proceeding / suit is not to be accepted as additional evidence. Also, if there is any gap or lacuna in evidence to be filled up, the discretionary power conferred upon the Appellate Authority does not authorise the Appellate Authority to fill the gap in question. The Tribunal / Court of Law is to see whether the Petitioner/Appellant lacked due diligence to be seen, and he cannot be allowed to fill up the lacuna at the belated stage. Moreover, the production of additional evidence is not to be permitted where a person does not satisfy the Tribunal / Court that such evidence was not within the knowledge or could not be produced with due diligence. Even though in the present case, the Appellant has come out with a reason that the Petitioner/Appellant had engaged a Part Time Employee to file the Annual Return before the Registrar of Companies and that because of the reason unknown to the Appellant, the said employee left and therefore, the Return could not be filed on time for the financial years 2016-2017 and 2017-18 and by the time it came to the knowledge of the Appellant/Petitioner Company, his name was already struck off from the register maintained by the Registrar of Companies , the Tribunal, in CP(Appeal) No.69/CTB/2020 on 21.08.2020, at para No.11 had clearly observed that before striking off the name of the company from its register, ROC, had issued a show cause notice to the Company enquiring whether the said Company was carrying any business or was in operation . This Tribunal , on going through the impugned order dated 08.08.2023 in CA 15/CB/2023 in CP/69/CTB/2020 is of the considered view that the Appellant had not filed CA 15/CB/2023 in CP/69/CTB/2020 within the two years period as envisaged under Section 420 (2) of the Companies Act, 2013 and in fact had filed the CA 15/CB/2023 in CP/69/CTB/2020 before the Tribunal 16.12.2022, after the lapse of two years period on 16.12.2022. Therefore, the Tribunal had rightly opined that the CA 15/CB/2023 was not to be considered in regard to the receiving of additional documents / additional evidence. Appeal dismissed.

Summary

Issues Involved:
1. Misinterpretation of High Court's Liberty
2. Company's Active Status and Documentation
3. Principles of Natural Justice
4. Limitation Period and Exclusion
5. Tribunal's Discretion on Additional Evidence

Summary:

1. Misinterpretation of High Court's Liberty:
The Appellant contended that the National Company Law Tribunal (NCLT), Cuttack Bench misinterpreted the "Liberty" granted by the Hon'ble High Court of Orissa. The Tribunal held that since the Company petition was not pending, there was no question of receiving additional documents in a disposed petition/proceeding. The High Court had granted permission to file an amendment petition, not an application to receive additional documents.

2. Company's Active Status and Documentation:
The Appellant argued that the company was active and maintaining requisite "Books of Accounts" as per the Companies Act, 2013. The Tribunal disregarded the "Sale Deed" produced as additional evidence, which showed the company was a "Going Concern" with considerable "Assets" at the time of "striking off." The company was engaged in "Business Operations" during the period of default, supported by audited Annual Accounts, Bank Account statements, and Income Tax Returns. The Tribunal, however, held that the company was not carrying out its business during the relevant time and was not a "Going Concern."

3. Principles of Natural Justice:
The Appellant submitted that there was a breach of the "Principles of Natural Justice" as no opportunity was given to explain and tender proof that the company was in operation. The objections of the Respondent/Registrar of Companies were not furnished to the Appellant.

4. Limitation Period and Exclusion:
The Appellant highlighted the exclusion period provided by the Hon'ble Supreme Court due to the COVID-19 pandemic, which should be considered while computing the limitation period. The Tribunal did not non-suit the Appellant based on limitation. The Appellant argued that the main Company Petition was filed within the statutory period, and the exclusion period should be considered.

5. Tribunal's Discretion on Additional Evidence:
The Appellant sought to introduce additional documents to support the revival of the company. The Tribunal held that the Appellant had not filed an application for amendment but for receiving additional documents, which was beyond the scope of the High Court's order. The Tribunal emphasized that additional evidence should not be accepted just because it might tilt the decision in the Appellant's favor. The Appellant lacked due diligence, and the production of additional evidence was not permitted as it was not within the knowledge or could not be produced with due diligence.

Conclusion:
The Appellate Tribunal dismissed the Company Appeal (AT) No. 227 of 2023, stating that the impugned order dated 08.08.2023 in CA 15/CB/2023 in CP/69/CTB/2020 passed by the NCLT, Cuttack Bench was free from any legal flaws. The connected pending IA No. 5615/2023 for stay was closed, and other connected pending IAs, if any, were also closed.