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2022 (11) TMI 702 - AT - Companies LawSeeking restoration of name of the Company in the Register of the Companies - shell Company - Section 252(1) of the Companies Act, 2013 - HELD THAT - After hearing the parties and going through the pleadings made on behalf of the parties, the Appellants have neither fact in issue nor question of Law and any ground raised with the legal provisions does not assail the finding of the Tribunal wherein the Tribunal held that the Appellant Company appears to be a shell Company. Therefore, the Impugned Order dated 11.12.2020 passed by the National Company Law Tribunal (New Delhi Court-III) is hereby affirmed. Appeal dismissed.
Issues:
1. Restoration of name of the Company in the Register of Companies under Section 421 of the Companies Act, 2013. Analysis: The appeal was filed against the final order passed by the National Company Law Tribunal (NCLT) rejecting the application seeking restoration of the company's name in the Register of Companies. The Appellants, ex-directors of the company, argued that the company had been actively conducting business operations, maintaining financial records, and fulfilling corporate obligations despite not filing financial statements and annual returns since 2012 due to staff shortage and financial crisis. They contended that the company's activities demonstrated its operational status and compliance with legal requirements. The Appellants emphasized that the company owned immovable property, conducted annual general meetings, prepared audited financial statements, and filed income tax returns up to the present date. They argued that the Respondents had overlooked crucial information, such as the company's land ownership and financial records, leading to an incorrect assessment of the company's status. The Appellants cited various legal precedents to support their case for setting aside the impugned order and allowing the appeal. On the contrary, the Respondents, including the Registrar of Companies (RoC) and the Income Tax Department, presented evidence showing that the company had not filed income tax returns after 2012-13 and had been non-operational for two preceding financial years. The RoC issued notices and published orders for striking off the company's name from the register based on non-filing of financial statements and reasonable belief of non-operation. The Respondents argued that the company failed to demonstrate just and equitable grounds for revival, as it neither conducted business activities nor held immovable property in its name for the specified period. After considering the submissions and evidence from both parties, the Tribunal affirmed the NCLT's decision to reject the application for restoration. The Tribunal concurred with the finding that the company appeared to be a shell company, lacking substantial business operations and failing to file income tax returns post-2012-13. The Tribunal dismissed the appeal, stating that the arguments presented did not challenge the NCLT's conclusion regarding the company's status. The judgment upheld the NCLT's order and directed the registry to upload the decision on the Appellate Tribunal's website and share it with the NCLT, New Delhi Court-III promptly.
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