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TMI Blog2022 (4) TMI 1576X X X X Extracts X X X X X X X X Extracts X X X X ..... he Companies Act, 2013 is that even a defunct company, like every other Company is under an obligation to file the Statutory Annual Returns till it is wound up or till such time, the Company is struck off by the Registrar u/s 248 of the Companies Act, 2013. As far as the present case is concerned, even though, the 1st Respondent/ Registrar of Companies has come out with the plea that the Company was incorporated on 25.08.1985 and the last Annual Return and Balance Sheet was submitted by the Company to its office, before it was considered to be struck off , relate to the Financial Year that ended on 31.03.2006 and later, no documents were filed by the Company to claim the status of a Dormant Company under Section 455 of the Companies Act, 2013, this Tribunal taking note of the fact that the Company has Assets and Liabilities and more so, keeping in mind that the right to seek restoration of the name of the Company (to be entered in the Register of Companies ) is not extinguished/lost as long as 20 years have not expired, and besides these, the 1st Respondent in its Reply before the Tribunal had mentioned that the Tribunal may kindly issue directions to the Appellant / Petitioner to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y Law Tribunal, New Delhi, Special Bench (CourtII) while passing the 'Impugned Order' dated 31.12.2020 in 'Appeal No. 350/252(ND)/2020 (filed under Section 252 of the Companies Act, 2013) among other things at paragraph 5 to 14 had observed the following: 5. "It is submitted by the Appellant Company that it was in operation since its incorporation. To corroborate its submission, the Appellant Company has placed the following documents on record • a) Copy of Financial Statements for the Financial Years from 2016-17 to 2018-19. b) Copy of the lease agreement executed on 22.03.2002, between Rajasthan State Industrial Development and Investment Corporation (RIICO) Limited depicting a piece of land known as Plot No. Hp". c) Copy of the Income Tax Return for the year 2006-07. d) Copy of the Bank Statement issued by Allahabad Bank for the period from 13.08.2010 to 31.12.2019 6. That the Income Tax Department has filed its reply and submitted that as per there e-filling database of the Assessee, no ITR was e-filled by the Assessee against the aforesaid allotted PAN, 7. The ROC, who filed its report, has made the following observation: "6) That the Resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hing placed on record pertaining to the period prior to 01.09.2017, which could prove beyond doubt that the company was in operation or was carrying out its business. The ROC in its report has also observed that the company was not carrying on any operations for a period of two immediately preceding financial years as indicated by non-filing of the financial statements of the Company for two or more years. 13. In the circumstances, it would be appropriate to refer to the Judgement of Hon'ble NCLAT in the matter of Alliance Commodities Private Limited Vs. Office of Registrar of Companies, West Bengal, Company Appeal (AT) No. 20 of 2019: "9. Section 252 (3) of the Companies Act, 2013 empowers the Tribunal to order restoration of a Company whose name has been struck off from the Register of Companies, if such company, any member or creditor or workman thereof feeling aggrieved by such striking off applies before the Tribunal seeking restoration of the struck off company to the Register of Companies before the expiry of twenty years from the publication in Official Gazette of notice under Section 248(5). The exercise of such power is properly regulated and depends upon s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the Register. 4. It is represented on behalf of the 'Appellant' that the 1st Respondent/Registrar of Companies had not objected to the restoration of the 'Appellant'/Company but prayed for a direction being issued to the 'Appellant'/Company to file all pending written as mentioned by the 1st Respondent, in its Report-cum-Affidavit. 5. The 2nd Respondent/Income Tax Officer, Circle 1(1) Delhi, through its 'Status Report' dated 10.11.2020 had not opposed the Restoration of the Appellant Company and that the 'Tribunal', through the 'Impugned Order' dated 31.12.2020 had dismissed the 'Appeal' filed by the 'Appellant'. 6. The Learned Counsel for the 'Appellant'/'Company' contends that the 'Company' has substantial 'Assets and Liabilities' which can be seen from its 'Financial Statements' (Annual Statements filed for the year ending 31.03.2017, 31.03.2018 and 31.03.2019) and the substratum of the 'Appellant'/Company also continues to remain intact. In this connection, the stand of the 'Appellant' is that, the 'Appellant'/'Company' had filed an Affidavit in respect of the 'Auditor's Report' for the 'Financial Year 2006-07, 2007-08, 2008-09, 2009-10, 2010-11, 2011-12, 2012-13, 2013-14, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had mentioned that there was no objection on its side, for the 'Restoration' of the 'Appellant'/'Company' and the relevant portion is as follows: "Further, form e-filing database of the assessee, it is observed that no ITR was e-filed by assessee against the aforesaid allotted PAN. However, this Office has no objection to the revival of the company in RoC." 13. It is vehemently contended on behalf of the 'Appellant'/'Company' that it has 'Assets and Liabilities' and is continuously carrying on its business operations and is following its objects. The 'Appellant' while filing the 'Appeal' before the 'National Company Law Tribunal' filed the 'Annual Statements' of the 'Appellant'/'Company' for the year ending 31.03.2017, 31.03.2018 and 31.03.2019. 14. Apart from that, it is the submission of the Learned Counsel for the 'Appellant'/'Company' that none of the 'Shareholders' or 'Creditors' of the 'Appellant'/'Company' shall be prejudiced by the 'Order of Restoration'. 1ST RESPONDENT/REGISTRAR OF COMPANIES REPLY: 15. The 'Impugned Order' passed by the 'National Company Law Tribunal' New Delhi, Special Bench (Court-II) in Appeal No.350/252(ND)/2020 dated 31.12.2020 is a correct on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany judge is satisfied that such restoration is necessary in the interest of justice." 18. In the matter of M.A. Panjwani v Registrar of Companies and Ors. (2015) 124 CLA 109 (Delhi) the Hon'ble High Court of Delhi at paragraph 16 had observed the following: "16. It was submitted on behalf of the Registrar of Companies that in striking off the name of the Company, the procedure prescribed in Section 560 of the Aft was followed. That may be so, Sub-section 6 of Section 560 gives power to the company court to order restoration of the name of the company if it finds that such of course was 'just'. The fact that the RoC did follow the due procedure prescribed by law while striking off the name cannot, therefore, be an answer to a petition filed on the ground that it would be 'just' to restore the name of the company." 19. In the decision in Kesinga Paper Mills PVt. Ltd. v Ministry of Corporate Affairs, 2010 (101) SCL 321(Del.) the Hon'ble High Court of Delhi at paragraph 10 had observed as under: "10. Further, when a litigation is pending by or against a company, it is only proper that its name be restored to the Register to enable the matter to be carried to its conclusion, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... name of the company in the Registrar of Companies, treating as if its name had never been struck off from the rolls of the register. The petitioner is directed to deliver the respondent Registrar of Companies a certified copy of this order within the time fixed under Rule 93 of the Rules. The Registrar thereafter shall proceed in the matter in accordance with the Act and the Rules. No order as to costs." 23. In the decision in Intec Corporation Private v the Registrar of Companies (2017) 201 Com Cas 18 (Delhi), the Hon'ble High Court of Delhi had observed the following: "As a matter of law, it cannot be said that where the company's name had been struck off on an application filed under Simplified Exit Scheme the company cannot be restored. In fact, the Madhya Pradesh High Court in VI Brij Fiscal Services P. Ltd. v Registrar of Companies, (2010) 155 Comp. Cas. 157 (MP) has restored a company which had been struck off under the Simplified Exit Scheme." "In view of the foregoing, and upon considering the facts and circumstances of the present case, I am of the view that it would be just and proper to order restoration of the name of the Petitioner Company in the Registrar of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charge of Punjab & Sind Bank on the property for the Company which is still alive in the records. Learned Counsel submitted that the Company paid property tax in 2011 which was after the date of striking off in 2007. According to the Appellant, it never knew that the name of the Company was struck off. It has been submitted that although the business got affected in 2002 because of multiplex, the company continued to remain in operation. It is claimed that this can be seen from the various documents which have now been filed in this appeal. 21. In course of argument, it has been noticed that the Company Petition filed in NCLT did not contain pleadings to spell out that the company was in operation. Pleadings to make out a case to the effect that "it is just that the company be restored" were also not there. The Appellants have now filed additional affidavit. It is mentioned in Paragraphs 12 & 13 as under: "12. One of the submissions of the Appellants in the course of the arguments was to seek remand of the matter to Hon'ble NCLT for fresh consideration based on all the additional documents placed in record before this Appellate Tribunal till date. 13. The Appellants is de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king off the name of the Company would create difficulties for the Appellant to pursue its remedies before the High Court and in the facts of the matter, when litigation was pending the name of the Company should not have been struck off. Para 12. The particulars show that in spite of Notices the Company did not respond and we do not find fault with RoC when the name was struck off because the Appellant admittedly had not responded to the Notices. However, in the facts of the matter, we find it just under Section 252 (3) of the Companies Act, that the name of Company should be restored, but Appellant should bear costs payable to RoC." and in fact, a direction was given to restore the name of the 'Appellant company' in the Registrar of Companies' to its original status subject to the 'Appellant'/Company depositing costs and expenses of Rs.1 lakh with the Registrar of Companies along with the certified copy of the order within one month of passing the order. Further, a direction was issued to the appellant/Company that within three months of date of passing of the order, it shall file its 'returns' due and pending financial Statements, Annual Returns and Documents with the Regi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation, or (b) otherwise that it is just that the company be restored. The first of these amounts to the court being satisfied that the registrars reasonable beliefs which were the basis for the original order striking the company off, were not in fact correct. The second means that, prima facie, the court has been persuaded that it is just to restore. In either case it seems to me that, absent special circumstances, restoration should follow. Exercising the discretion against restoration should be the exception, not the rule," (Page 476) Once the court has acquired jurisdiction on the basis that the new applicants interests make restoration just it would be harsh indeed to refuse the relief sought because some other third party may be inconvenienced by it. These considerations lead me to the view that the court should be very wary of refusing restoration so as to penalize a particular applicant or in a possibly futile attempt to safeguard the special interests of a single or limited class of affected persons. It would need a strong case to justify a refusal on these grounds…………….(Page 477) (emphasis supplied). 33. In the matter of Conti v Ueb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... intend to run the Business and pay off the 'liabilities' as per 'Balance Sheet of the Company'. In fact, the 'struck off company' at present, is having 'paid-up capital' of Rs.4,99,000/- consisting of 49,900 Equity Shares' of Rs.10/-each and all the 'Shareholders' hold the total paid-up 'Share Capital of the Company' and 'struck off company' would suffer losses. The 'Appellants'/100% shareholders of the Company had filed the Company Appeal No.350/252(ND)/2020 before the 'Tribunal' seeking name of the Company be 'Restored', and such 'Restoration' would shall be in the Company's interest, Shareholders interest and the 'Public Interest'. If the name of the 'Company' is 'Restored to the Register of Companies' maintained by the 1st Respondent/Register of Company, it is the plea of the Appellants that no one shall suffer any prejudice. In case, the 'Restoration' is not ordered, then the 'Appellants' and persons related to the Company would suffer an irreparable loss. Hence, the 'Appellants' pray for allowing the Company Appeal No.350/252(ND)/2020 filed before the 'Tribunal' and for issuance of directions to the 1st Respondent/Registrar of Companies (i) to restore the name of the Company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lief of 'awarding of costs' in favour of it was sought before the 'Tribunal', as the Company had failed to file its 'Statutory Returns' before it. 'Preferring of an Appeal': 41. It is pointed out that Section 252(1) of the Companies Act, 2013 indicates that 'any person aggrieved by the Order of the Registrar, notifying a 'Company' as dissolved undersection 248 is entitled to prefer an 'Appeal' to the National Company Law Tribunal'. Furthermore, if a Company or any 'Member' or 'Creditor' feels aggrieved, they would also be competent to file an 'Appeal' against the 'Order' of the 'Registrar of Companies' before the expiry of 20 years from the date of 'Publication' of Order in the Official Gazette, in terms of the ingredients of Section 252(3) of the Companies Act, 2013. Fulfilment of Conditions: 42. Indeed, Section 252(3) of the Companies Act, 2013 points out that one of the three conditions need to be satisfied before exercising the 'jurisdiction' to restore a company to the 'Registrar of Companies' on the file of 'Registrar of Companies'. In fact, the 'Company' at the time of its name was struck off was to carry on business, or it was in operation, or it is otherwise just that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at from that perspective, the 'Appeal' succeeds. Conclusion: 46. In fine, the Instant Company Appeal (AT) No.47 of 2021 is allowed. No costs. The Impugned Order dated 31.12.2020 in Company Appeal No.350/252(ND)/2020 passed by the National Company Law Tribunal, New Delhi Special Bench, Court II is set aside by this 'Appellate Tribunal' for the reasons ascribed in this 'Appeal'. The 'Notice' of 'striking off' and 'dissolution' in the required Form No.STK-7 dated 21.08.2017 is set aside. It is abundantly made quite clear that the 'Restoration of the Name of the Appellant's Company' is subject to its filing of all outstanding documents required by Law and completion of all Statutory formalities, including payment of any late fee or any other charges which are leviable by the 1st Respondent for late filing of 'Statutory Returns' and also on payment of cost of Rs.40,000/- (Rupees Forty Thousand only) to be paid to the 'Prime Minister Relief Fund'. The name of the Appellant Company' shall then, as a resultant effect, shall stand restored to the 'Register of the Registrar of Companies' as if the name of the Company was not 'struck off', in accordance with Section 248(5) of the Companies ..... X X X X Extracts X X X X X X X X Extracts X X X X
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