Cameo Fabric Pvt Ltd And Anr. vs Registrar Of Companies, Mumbai

This present Petition has been filed under Section 252 (1) of the Companies Act, 2013 (Act) by CAMEO FABRIC PRIVATE LIMITED through

its one of the Director Mr. Usha Jaykar praying for restoring the name of the company in the Register maintained by the Registrar of Companies,

Mumbai (RoC).

The Company was incorporated on 22nd May, 1969 and is a going concern engaged in the business of job work of machine embroidery. The

Appellant Company has been allotted CIN No. U17100MH1969PTC013588.

Petition for operation and mismanagement came to be filed in or about 2007 before the erstwhile Company Law Board in Company Petition No.

02/2008 read with Company Petition No. 70 of 2006. On 8th January, 2008, an Order came to be passed by the Hon’ble Company Law Board in

Company Petition No. 02 of 2008 which read as under:

“Petition mentioned and heard on interim reliefs. Till the Petition is disposed of no general meeting is to be held without the leave of this

Board. Reply to be filed by 10/02/2008 and rejoinder by 10/03/2008. Date of hearing denotified on 09/01/2008. Petitioner to serve copies

of the Petition on the Respondents along with copies of the order in 3 days.â€​ (See Petition page 12.)

The Applicants herein are parties to the Company Petition No. 70 of 2006, which is pending disposal before this Hon’ble National Company

Law Tribunal. The Appellants herein are also parties to the Company Petition No. 02 of 2008 which is also pending before this Hon’ble National

Company Law Tribunal.

An Order came to be passed by the Hon’ble Company Law Board in Company Application No. 471 of 2012 in Company Petition No. 70 of

2006 in or about September 2013 and the said matter was thereafter carried in Appeal before the Hon’ble High Court of Judicature at Bombay in

Company Appeal No. 12 of 2014. On 12th July, 2017, the Hon’ble High Court of Judicature at Bombay pronounced its Order in Company Appeal

No. 12 of 2014 by virtue of which the Order of the Hon’ble Company Law Board was continued and the matter was transferred to the

Hon’ble National Company Law Tribunal, New Delhi.

The Order of the Hon’ble High Court of Judicature at Bombay was then carried to the Hon’ble Supreme Court of India, however, the

Hon’ble Supreme Court vide its Order dated 8th August, 2017 expressed its opinion that it was not inclined to interfere with the impugned Order.

(See Exhibit “Eâ€​ at page 91 of the Petition.) The Company Petition is therefore pending before the Principal Bench of the Hon’ble NCLT.

During the pendency of the abovementioned proceedings before the various judicial Forums, the Registrar of Companies in April 2017 issued a

Notice bearing reference No. ROC/Section 248/Strike Off/2017/44799 under Section 248 of the Companies Act, 2013. The said Notice was suitably

replied to by the Appellant vide their letter dated 21st April, 2017. The Petition was thus filed.

The said Notice was followed by a Notice for Disqualification of the Directors’ Identification No. U/s. 164(2)(a) dated 7th December, 2017 in

which the Directors’ identification numbers of the Directors of the Appellant Company were mentioned at Serial No. 1675 and 1676 The said

Notice was replied to by the Advocate for the Appellant vide her letter dated 4th October, 2017.

The present Appeal came to be heard before this Hon’ble Tribunal [Coram: Shri M.K. Shrawat, Member (J)] where the Hon’ble Member

passed an Order dated 22nd March, 2018, which recorded as under:

“1. The Learned Representative of the Petitioner is present.

The Learned Representative for one of the Shareholder/Intervener is present.

After having discussion with the Learned Counsel, it appears that as per the last accounts with the ROC Office two DIN Numbers

connected with this are proved. However, name of one of the Director is in the pleadings. If deem fit the Petitioner can be amended

accordingly.

An evidence is placed on record that the Company is active as per the records of the ROC. Hence no order is required under section 252

in the case of this Company.

Since the Company is already active no apparent reason is mentioned by the ROC for striking of the names of the Directors.

Hence the Registry is directed to issue a Notice to the ROC to submit the Report on or before the next date of hearing as to why the

Directors have been removed from the Registrar of Companies.

The matter is adjourned to 20-04-2018.â€​

The matter once again came to be heard on 20th April, 2018 where the Hon’ble Tribunal observed that its Order passed on 22nd March, 2018

was yet to be complied with and the representatives for the Respondents undertook to file a Status Report by the next date of hearing.

The Registrar of Companies in spite of being made aware of the Order of the Hon’ble Company Law Board, issued a strike off Notice on 4th

September, 2018 bearing reference No. ROC/Section 248/22774/2018/M3193 in Form STK1. The said Notice was replied to by the Advocate for the

Appellant by their letter dated 5th October, 2018 informing them about the pendency of this Petition and also drawing their attention to the Order of

the Hon’ble Company Law Board.

It is pertinent to note that, due to the Order of the Hon’ble Company Law Board, the Appellant is not able to hold any meetings and as a

consequence, the Appellant could unable to file its annual returns or complete any statutory compliances. It is therefore submitted that the Appellant

cannot be held at fault for the same and noncompliance due to being restricted by an order of the Hon’ble Company Law board. In the said

circumstances, the Respondent has wrongly issued the said notices striking off the names of the Appellant and its directors. Therefore, in the said

circumstances, the Appellant cannot be non- suited from pursuing legal remedies available to it before any legal forum or tribunal, due to the said

actions of the Respondent wrongfully striking off the name of the Appellant.

The representatives of the Appellant Company on various occasions followed up with the relevant Authorities in the office of the Registrar of

Companies and brought the Order of the Hon’ble Company Law Board’s attention, however, their efforts were of no avail and the Registrar

of Companies once again issued during the pendency of this Appeal a Notice dated 17th July 2019 bearing reference No.

ROCMUMBAI/248(1)/3400472019 under Section 248 of the Companies Act, 2013.

The matter was heard on numerous occasions and an Order dated 3rd August, 2020 (Coram: Shri H.P. Chaturvedi and Shri Ravikumar

Duraisamy) once again directed the Registrar of Companies to submit its report and directed the Appellant to communicate a copy of the Order

passed in March 2018 to the Registrar of Companies.

The Hon’ble Tribunal on 28th September, 2020 once again requested the Regional Director, Western Region, Mumbai to issue appropriate

instructions to the office of the Registrar of Companies, Mumbai to expedite filing of the report as previously sought by the Hon’ble Tribunal and

the Registry of the Hon’ble NCLT was directed to issue a formal notice to the Registrar of Companies, Mumbai.

The matter was once again heard on 16th October, 2020 on which occasion, once again none appeared for the Registrar of Companies and the

Appellant was once again requested to serve a copy on the Registrar of Companies as well as the Income Tax Department. The Advocate for the

Appellant once again served a copy of the Order to the Registrar of Companies and the Income Tax Department.

The matter was once again heard on 6th November, 2020 on which occasion, last opportunity was given to the Registrar of Companies to submit

its report within 10 days from the date of the said Order.

The matter was thereafter heard on 23rd November, 2020 on which occasion, Ms. Yogini Chauhan appeared for the Registrar of Companies and

sought two weeks’ time to file a comprehensive reply and comply with the Orders dated 22nd March, 2018 and 20th April, 2018.

The matter was thereafter finally heard on 18th December, 2020 on which occasion, once again none appeared for the Registrar of Companies

and the matter was reserved for orders. It was submitted that the Registrar of Companies has given an undertaking to this Hon’ble Tribunal to

provide such details as was sought from them by the Hon’ble Tribunal vide their Order dated 22nd March, 2018. The undertaking is recorded in

the Order dated 20th April, 2018. Multiple opportunities were given to the Registrar of Companies, however, they did not complied with above said

direction of this Court and did not disclose on oath the reason for disqualifying to the Director of the Company despite the Hon’ble Company Law

Board’s Order. They did not explain the reason for issuance of the strike off Notice issued in 2017, 2018 and 2019 even during pendency of this

particular Petition in the Supreme Court, High Court and the NCLT notices have been issued by the Respondents to strike off the Appellant Company,

even after the Order dated 22nd March 2018 was passed by this Hon’ble Tribunal.

It is therefore submitted that this Hon’ble Tribunal issue a direction to the RoC not to strike off the name of the Appellant Company from the

Registrar of Companies and to restrain the Respondent/RoC from taking any coercive action against the Appellant Company or its Directors during

the pendency of the litigation the operation and mismanagement Petition which is pending before the Principal Bench of the Hon’ble NCLT.

The Appellant Company has duly informed on 08th January, 2008 in Company Petition 02/ 2008 by the Hon’ble Company Law Board was

pleased to pass on order directing as such “Petition mentioned and heard on interim reliefs. Till the petition is disposed of No General Meeting is to

be held without the leave of this Board"" This matter is still pending before Hon’ble NCLT (New Delhi) with Company Petition No. 70/2006 and

the Company is still injuncted from conducting any general meeting and under provisions of the both Companies Act 1956/2013 the Company are

required to file with the Registrar of Companies the audited copy of financial statement with in a period of 30 days of holding the Annual General

meeting and the Annual return within a period of 60 days of the Annual General meeting. Since no Annual General meeting can be conducted, the

Company has defaulted.

The Requirement under Companies Act, 2013 is that an Auditor has to be appointed at an Annual General Meeting till the conclusion of next

Annual General Meeting. Since the Company is still injuncted from conducting any general meeting, an auditor cannot be appointed so no statutory

filing can be audited and filed with RoC, Mumbai.

The Applicant by way of additional Affidavit submitted the proof that the Company has assets in its name which are as follows:

Fixed Assets:-

Office at 46, The Arcade Shopping Centre, Mvirdc World Trade Centre, Cuffe Parade, Mumbai 40005 (pg 9 of Additional Affidavit)

Factory at C 16, TTC Midc, Thane, Navi Mumbai 400705 (pg 11 of Addtional Affidavit).

Plant & Machinery, Electrical fitting, Furniture, Computer.

Movable Assets:-

Stock, Raw Material

Notice were issued to the Respondent, but no one appeared on behalf of the Respondent.

The bench has directed RoC to submit his report in spite of that RoC has not submitted his report. As per Section 252(1) of the Companies Act,

2013, an opportunity was provided to RoC to submit his report, however RoC failed to submit the same. We are therefore of considered view that in

the interest of Justice and Equity, to help Employees, Members, Shareholders, Creditors and Other stakeholders and also to improve ease of doing

business, the name of Petitioner Company be restored.

We examined the merits of the present appeal as per the provisions of Companies Act (Removal of Names of Companies from the Register of

Companies) Rule, 2016 and the relevant provision of the act and settled legal position in this respect for the sake of convenience. The relevant

provision of Companies Act (Removal of name of companies from Registrar of Companies) Rule, 2016 are

“3. (1) The Register of Companies may remove the name of a company from the register of companies in terms of sub-section (1) of

section 248 of the Act:

Provided that following categories of companies shall not be removed from the register of companies under this rule and rule4, namely: -

(i)………….

(ii) ………….

(iii) ………..

(iv) Companies where inspection or investigation is ordered and being carried out or actions on such order are yet to be taken up or were

completed but prosecutions arising out of such inspection or investigation are pending in the Court;â€​

In addition to the above, The Hon’ble Delhi High Court, in the matter MA Panjwani v/s Registrar of Companies (2015) 192 Company cases

380 (Delhi) has held that when a company was a Defendant in a case pending before a Civil Court, its name was directed to be restored, because no

justice would have been possible with no body as defendant in the case.

In another decision, The Hon’ble High Court (Telangana and Andhra Pradesh) in the matter of Vedmatic CJ Rao v/s Sree Raj Rajeshwari

Paper Mill Ltd (2016) 198 company cases, 335 (Telangana and Andhra Pradesh). It has been held that when the name of a company was struck off

on such bonafide belief that company was not having any assets but later on it was found that there was acquisition of information about the assets of

the company. In such situation, it was held that Ex- chairman or Shareholder of the company can apply for restoration of the name of the company. It

could be just to do so either to claim the assets of the company or to answer the claim of third parties against the company. Thus, the Registrar was

directed to restore the name of the company.

In the light of the above given facts and circumstances, we are of the view the prayer sought by the Petitioner company deserves to be allowed

because it is now well settled legal position that during the pendency of litigation/Court proceedings by or against the company its name can not to be

removed by the RoC.

ORDER

In the light of above stated direction. We feel just and equitable to allow the Petitioner’s Appeal CP No. 648/252(1)/MB/C-II/2017 filed by

Appellant/Petitioner CAMEO FABRIC PRIVATE LIMITED, through its Director Mr. Usha Jaykar of the company’s in the statutory Register of

the Companies being maintained by the Registrar of Companies. The present appeal is allowed with the following conditions and directions.

The Respondent is directed to restore the name of the Petitioner company in the statutory register to filing of all. Statutory return and payment of filing

fee as applicable. The company shall file all its pending financial statements and Annual Returns with all the applicable fees and late fees with the

Respondent RoC within a period of 90 days from the date of receipt of copy of an authentic copy of this order.

The Company is directed to make payment a sum of Rs. 25,000/- (Rupees Twenty Five Thousand only) to the account of “PM CARES FUNDâ€

within 30 days from receipt of the copy of the order with this observations present appeal is allowed conditionally and stand disposed of.