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TMI Blog2024 (2) TMI 1261X X X X Extracts X X X X X X X X Extracts X X X X ..... eptember 2021 as per the petitioner s letter dated 24 August 2021 received by the company. This is the legal consequence as brought about by Section 168(2) of the Companies Act, 2013. Except for certain forms not being filled by the company within the prescribed time, there does not appear to be any other gross default or illegality or any other justifiable reason for the Registrar of the Companies to give effect to the resignation of the petitioner, in the official records, as maintained by him. This is fortified from the contents of the reply affidavit of the official respondents which categorically state that even the explanations / comments and / or compliances as demanded by the Registrar of Companies from respondent No. 4/company were reported to be not answered by the company. This was a default on the part of a non-functional company. Thus, this is clearly a case where the company itself was stillborn. Petition allowed. - G. S. KULKARNI FIRDOSH P. POONIWALLA, JJ. For the Petitioner : Mr. Ashok Singh. For the Respondent Nos. 1 to 3 : Mrs. Shehnaz V. Bharucha and Mr. Mohamedali Chunawala.. ORAL JUDGMENT (PER G. S. KULKARNI, J.) RUL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014, the resignation tendered by Mr. Rajiv Sharma from the office of Directors of the Company with effect from 1st September, 2021 be and is hereby noted. RESOLVED FURTHER THAT intimation of Form DIR-12 signed by one of the Directors be filed with Registrar of Companies, Mumbai. RESOLVED FURTHER THAT Mrs. Vidya Pawar, Mr. N D Satish, Mr. Ashwin Dhawle or Ms. Della Santhosh T the Company Secretaries in Practice, be and are hereby authorised to certify the necessary e-form as may be required to be filed by the Company with the Registrar of Companies, Mumbai. By Order of the Board For LOCAL SEARCH SOLUTIONS PRIVATE LIMITED LOCAL SEARCH SOLUTIONS PRIVATE LIMITED 6. The Petitioner has annexed documents to show that the business of the Company could never commence. As nothing was heard from the Company in regard to the steps being taken to complete the formalities of resignation of the Petitioner as a director, the petitioner addressed a letter to the Registrar of Companies, inter alia, informing that on 24 August 2021, the petitioner had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re particularly under Sections 10A, 12, 92, 137 96 thereof. It is averred that the Directors are in default as per Section 166(3) of the Companies Act. The affidavit referring to such provisions contends that the claim of the petitioner for deletion of his name as director of the said company in the official records of Respondent No. 4, could not to be accepted, for want of such compliances by the company. It is also stated that both the directors of the company, namely, the petitioner as also respondent No. 5, were in default for having not complied with the provisions of Rule 12A of the Companies (Appointment and Qualification of Director) Rules, 2014, by not submitting form DIR-3 within the prescribed time period and hence, the DIN of Respondent No. 5 (the foreign director) was also deactivated. The relevant contents of the affidavit reads thus: 6. With reference to Paras C, D, E, of the grounds provided by the petitioner, the contention of the Petitioner is not valid as the Company has not filed Form INC - 20 as per the provisions of Section 10A, of the Companies Act, 2013 and as a result form DIR 11 and Form DIR 12 cannot be filed. Hence the Petitioner cannot claim reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h was during the pandemic period, which was duly noted by the Board of Directors and a resolution to that effect was also passed which we have extracted hereinabove. It appears that, however, what had remained on the part of the company, was to make necessary compliances with the Registrar of Companies, so that the records of the Registrar of Companies qua the company stand updated inter alia also in regard to the resignation of the petitioner. As the business of the company itself did not commence such compliances had remained to be undertaken. The petitioner being an Indian director, however, was certainly more concerned that his name ought not to continue as the director of the said company as the other director was a Russian National (Respondent No. 5). 12 In the context of the issue in hand, we need to note the relevant provisions of the Companies Act, 2013 in relation to resignation of the Director being Section 168 of the Companies Act which reads thus:- 168. Resignation of Director. (1) A Director may resign from his office by giving a notice in writing to the company and the Board shall on receipt of such notice take note of the same and the company shall inti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d bring about, then certainly it would be an obligation on the Registrar of Companies to give effect to such legal position in its records, and more particularly when an intimation to that effect was received from the petitioner. 15. In our opinion, although certain compliances on the part of the company, as noted by us hereinabove were necessary, however, in the peculiar facts of the present case, it is clear that the company itself did not commence its business, as also the other director being a foreign director did not take any steps in that regard. Added to this was the Covid-19 pandemic period during which such compliances could not be made. All these circumstances ought not to weigh against the petitioner, for deletion of his name as a director from the record of the Registrar of Companies. This also for the reason that severance of the petitioner s relationship as a director of the company took effect from 1 September 2021 as per the petitioner s letter dated 24 August 2021 received by the company. This is the legal consequence as brought about by Section 168(2) of the Companies Act, 2013. Further, except for certain forms not being filled by the company within the presc ..... 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