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Judgment
Suchitra Kanuparthi, Member (J)
The appellant company filed the present petition under section 252 of the Companies Act, 2013 seeking restoration of the name of the company on the registrar of companies maintained by the ROC Mumbai.
The company was registered on 19.09.2013 with registration No. AAB-7746, as a Limited Liability Partnership with the Registrar of Companies, Mumbai, Maharashtra with LLP Agreement dated 14.10.2013 having its Registered office situated at: B-38, Shanti Campus CHS, Pandit Madan Mohan Malviya Road, Mulund, Mumbai 400080.
ROC Mumbai struck off the appellant company's name due to defaults in compliances namely failure to file statutory financial statements and annual returns for the period from 2014- to 2018. The ROC initiated proceedings under section 75 of the LLP Act, and issued notice dated 11.05.2018 informing the appellant company that the LLP has not been functioning since the year 2014 and the ROC being satisfied under section 75 of the LLP Act, 2008 and the said LLP is liable to be struck off. The ROC eventually struck off the LLP vide public notice on 10.07.2018.
The appellant company submits that they have been active since incorporation and have been maintaining all documentation, but did not receive any show cause notice from the ROC and therefore it was not afforded any opportunity of being heard before the LLP was struck off. The appellant further submits that they have engaged the service of Company Secretary to perform the task of filing returns with the ROC, but however, the fact was not revealed to the directors of the company. After receipt of the notice dated 11.05.2018 the appellant immediately started online filling of compliance as per LLP rules, but the same could not be filed as the appellant company's name would struck off.
The learned counsel submitted a detailed note relying on notifications of central governments which expressly declared the applicability of Sec 560 of Companies act 1956 in pursuance of Sec 67 of LLP Act 2008. Further, he sought to connect the old Companies Act 1956 with new Companies Act 2013 and established that certain provisions of Companies act 1956 still prevail and have not been repealed by the advent of Companies Act 2013 and hence prayed that the LLP which was struck of by the Respondent under Sec. 75 of LLP Act, could also be restored under the Sec. 252 of the Companies Act 2013.
Report filed by ROC;
The Roc submitted that the present petition filed for the restoration of LLP governed by LLP Act, 2008 and r/w section 252 of the Companies Act, 2013 hence the petition is filed under incorrect provisions of LLP and is not governed by the Companies Act, 2013. On this ground along the instant petition may be dismissed.
The ROC further submitted that the appellant company was incorporated with the ROC, Mumbai on 19.09.2013 under the provisions of the LLP act, 2008 and failed to comply with the statutory compliances under the LLP Act, 2008 for more than 2 years as such the LLP was struck of under section 75 of the LLP Act r/w rule 37 of the LLP rules.
The ROC further submits that the LLP was given notice on 11.05.2018 and the LLP was struck vide public notice on 10.07.2018. They further mentioned that the provision of the Companies Act, 2013 more particularly section 252(1)(3) of the Companies Act, 2013 are not applicable to LLP.
The ROC further reiterated that as per section 67 of the LLP Act, 2008 the central government may by notification direct that any of the provisions of the Companies Act, 1956 specified in this notification shall apply to LLP. Further the provision of the section 458 and 460 of the Companies Act, 2013 vide notification dated 20.09.2014 and 30.01.2020, but the provisions of section 252 were not made applicable to LLP hence, the ROC sought dismissal of the petition.
Findings;
In view of Section 67 of LLP act, 2008, it can be said that central government has express power to notify in the Official Gazette, direct that any of the provisions of companies act, 1956 shall be applicable to any LLP. Section 67 of the LLP Act, 2008 reproduced below;
"67 Application of the provisions of the Companies Act. -
(1) The Central Government may, by notification in the Official Gazette, direct that any of the provisions of the Companies Act, 1956 (1 of 1956) specified in the notification-
(a) shall apply to any limited liability partnership; or
(b) shall apply to any limited liability partnership with such exception, modification and adaptation, as may be specified, in the notification.
(2) A copy of every notification proposed to be issued under sub-section (1) shall be laid in draft before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in disapproving the issue of the notification or both Houses agree in making any modification in the notification, the notification shall not be issued or, as the case may be, shall be issued only in such modified form as may be agreed upon by both the Houses."
Further, by notification No. Notification No. G.S.R. 6(E) : MANU/DCAF/0008/2010 dated 6th January, 2010, the Central Government declared an exercise of powers under section 67 that the provisions of section 560 of Companies Act are applicable to the Limited Liability Partnership Act, 2008.
"Notification u/s. 67 of Limited Liability Partnership Act, 2008: Through the Notification No. G.S.R. 6(E) : MANU/DCAF/0008/2010 dated 6th January, 2010, the Central Government in exercise of powers conferred by sub-section (1) of section 67 of Limited Liability Partnership Act 2008 (6 of 2009), made applicable the provisions of sections 441, 443, 445, 446, 448, 450, 451, 453, 454, 455, 456, 457, 458, 458A, 460,463, 464, 465, 466, 467, 468, 471, 474, 476, 477, 478, 479, 481, 482, 483, 484, 486, 487, 488, 494, 497, 511, 511A, 512, 514, 515, 517, 518, 519, 528, 529, 529A, 530, 531, 531A, 532, 533, 534, 535, 536, 537, 538, 539,540, 541, 542, 543, 544, 545, 546, 547, 548, 549, 550, 551, 552, 553, 554, 555, 556, 558, 559, 560 and 584 of the Companies Act, 1956 to a limited liability partnership, except where the context otherwise requires, with certain modifications."
Section 560(5) (6) of the Companies Act, further provides that the company or member or creditor may seek the restoration of the company on the role of ROC in case it is struck off by ROC. Therefore by culling out principles of law from two different Acts which are applicable to the LLP, it can be said that, the LLP which was struck off could also be restored under section 560 of the Companies Act, 1956.
It is pertinent to note that the definition of company under Section 2(20) of the Companies Act, 2013, means a company incorporated under this act or under any previous company law. If we look at the definition of Previous Company law under sec 2(60), Previous Company law means and include Companies act 1956. Further it is seen that the LLP Act was enacted in the year 2008, before the introduction of Companies Act 2013. However, in the year 2010 the notification dated 06.01.2010 expressly declared that the provision of Companies Act 1956 more particularly section 560 of the Companies Act would be applicable to any LLP under LLP Act, 2008.
There is no provision of restoration of stuck off company under the LLP Act, 2008 and therefore we need to seek restoration of the company under the erstwhile section 560 of the companies act, 1956 and more particularly in view of the definition of the company of section 2(20) which includes the previous company law as well.
It was made clear under Sec 465 of Companies Act 2013, that certain provisions of the Companies Act, 1956 has not been repealed and shall continue to apply and therefore the relevant notification dated 6.01.2010 of central government holds good.
By virtue of third proviso Sec. 465 of Companies Act, 2013, the provisions of Companies Act, 1956 referred in the notification under sec. 67 of LLP Act, 2008, shall until the relevant notification under such section applying relevant corresponding provisions of Companies Act, 2013 to Limited liability partnerships is issued, continue to apply as if the Companies Act 1956 has not been repealed. There is no further notification issued under Sec. 67 of the LLP Act, 2008 making application of Sec 248 to 252 of Companies, 2013 to the LLP's registered under LLP Act, 2008.
This Bench is of the opinion that in the absence of any relevant provision of restoration of struck off LLP under the LLP Act 2008, the law maker has made provisions to bridge the gap and as such a declaration under section 67 of the Companies Act which expressly provided that section 560 of the Companies Act, was made applicable to LLP Act and in view of the declaration of Central Government on 6.01.2010, LLP could be restored under the erstwhile Companies Act, 1956. Therefore applying the same analogy that under the Companies Act 2013, the legislature intended to include previous company law in the definition of Company under Sec 2(20), which categorically includes Companies Act 1956. We conclude that provisions of Sec 560 of Companies Act 1956 are akin to the provisions of section 252 of the Companies Act 2013, therefore LLPs which was struck off under section 75 of the LLP Act, 2008 shall be restored under Sec. 252 of Companies Act 2013. No person shall be left without the remedy in the absence of any express provision of restoration of LLP under the LLP Act. We necessarily have to rely on the relevant provisions of Sec. 2(20) r/w Sec. 2(60) of Companies Act 2013, r/w Sec. 465 of Companies Act, 2013, r/w the GSR Notification of Central Government dated 06.01.2010 which held that Sec. 560 of Companies Act 1956 was applicable to the LLPs which were incorporated under the LLP Act 2008 and hold that the provisions of Sec 252 of Companies Act 2013 shall be made applicable to the LLP and restoration of the LLP can be ordered forthwith.
ROC has struck off the LLP under Sec. 75 of the LLP Act 2008, which empowers the ROC to strike out defunct Companies and in the instant case, the LLP was active and could not file the statutory compliances.
In view of the above discussion, the appeal filed by the appellant under section 252(3) of the Companies Act, 2013 is allowed r/w 11 of the NCLT rules, 2016.