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TMI Blog2022 (12) TMI 620X X X X Extracts X X X X X X X X Extracts X X X X ..... en sometime in 2016-17 in order to ensure that filing of regular returns and compliances are undertaken strictly as per the provisions of the Act. It was also meant to be a measure to ensure that entities that are not conducting businesses are not misused as 'shell companies' for any improper activities. A substantial part of the disqualification period has already been completed. The introduction of the CFSS is itself a step for 'providing a fresh start'. Under such circumstances, continuation of the disqualification would defeat the Scheme and its purpose. In furtherance of the purpose of this scheme, directors of struck off companies who seek to be appointed as directors of other/new companies, ought to be provided an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AND LEISURE VALLEY PRIVATE LIMITED ● BHAVYEH HOTELS RESORTS PRIVATE LIMITED ● SKY GANGA CONSTRUCTION PRIVATE LIMITED ● SABHYA INFRABUILD PRIVATE LIMITED ● VINCENT BUILDCON PRIVATELIMITED 4. Petitioner No.2 is a director in the following companies: SHRIMAHANAND LEISURE VALLEY PRIVATE LIMITED BHAVYEH HOTELS RESORTS PRIVATE LIMITED VINCENT BUILDCON PRIVATE LIMITED 5. The grievance of the Petitioners is that they have been disqualified without issuing any show cause notice, or giving any giving any opportunity to present their case. It is the case of the Petitioners that Respondent No.1 never published any list disqualifying the Petitioners. The deactivation of the Peti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cant in all companies. The said proviso, has, however, come into effect only on 7th May, 2018. In Mukut Pathak (supra) it was held that this proviso cannot have retrospective effect and would only apply if the disqualification took place after 7th May 2018. Paragraph 98 of Mukut Pathak (supra) reads as under: 98. In view of the above, the petitioners would not demit their office on account of disqualifications incurred under Section 164(2) of the Act by virtue of Section 167(1)(a) of the Act prior to the statutory amendments introduced with effect from 07.05.2018. However, if they suffer any of the disqualifications under Section 164(2) on or after 07.05.2018, the clear implication of the provisos to Section 164 (2) and 167(1)(a) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se, this Court in Sandeep Agarwal (supra) directed reactivation of the DINs and DSCs of directors of two companies-one whose name had been struck off and one, which was still active. Thus, the DINs and DSCs of disqualified directors of struck off companies, who are also directors in active companies, may be reactivated qua the active companies, in line with the spirit of the CFSS-2020. (c) Directors of 'active' companies who have been disqualified: In cases where directors of 'active' companies have been disqualified, CFSS-2020 would squarely apply. Such directors would be entitled to avail of CFSS-2020 and file documents of the defaulting company. In Radhika Byrn (supra), the Court permitted reactivation of the DI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who seek to be appointed as directors of other/new companies, ought to be provided an opportunity to avail of this scheme, provided that they have undergone a substantial period of their disqualification. The scheme clearly seeks to provide a fresh start for directors of defaulting companies who seek appointment in other companies or wish to start new businesses. Therefore, if a substantial period has passed since the disqualification of such directors, they ought to be given an opportunity to avail of the scheme. 8. Following the decision in Mukut Pathak Ors. v. UOI Ors., [W.P.(C) No.9088 of 2018, decided on 04th November, 2019] and Anjali Bhargava Anr. v. UOI Anr. [W.P.(C) 11264/2020, decided on 6th January, 2021], this Co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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