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Judgment
Dr. Deepti Mukesh, J
This appeal is filed by Chadha Developers and Promoters private limited, (for brevity the 'appellant'), under Section 252(1) r/w Section 252(3) of the Companies Act, 2013 (for brevity 'the Act') read with Rule 7 & 9 of Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 by Registrar of Companies, the respondent herein.
The appellant is private limited company incorporated on 5th September 2006 under the provisions of companies Act, 1956 bearing CIN U70109DL2006PTC153072 having its registered office at Plot No. 15, Road No.29, Punjabi Bagh Extn, Near Punjabi Bagh.. The Authorized share capital of the Company is Rs. 20,00,000/- and issued, subscribed and paid up share capital of the Company is Rs. 1,00,000/-.
The main objects of the Appellant Company as stated in the Memorandum of Association are to carry on the business of promoters, builders, developers, realtors, colonizers, architects, contractors, sub-contractors, dealers, planners, designers, construction engineers, decorators, interior decorators, fabricators, engineers, developers of infrastructure such as township, commercial complex, road, highways bridges, canals, culverts, fountains, reservoirs and damn, sanitary works, sewers, hydel projects, power supply works and Real estate agents. To engage in all types of construction activities.
The Respondent No. 1 is the Registrar of companies NCT of Delhi and Haryana and in furtherance of common Notice dated 27.04.2017 and vide order dated 30.06.2017 bearing No. ROC-DEL/248(5)/STK-7/2879 in terms of provision of Section 248(1) of the Companies Act, 2013 read with Rule 7 and Rule 9 of the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 struck off the name of the appellant from its register and dissolved the company with effect from 7th June 2017, on the ground that the Appellant Company has not been carrying on any business or operation for a period of two immediately preceding financial years.
The appellant submitted that since 2007 to 2013 appellant Company has been duly filing all mandatory annual documents including Annual returns and audited financial statements. The appellant further submitted that inadvertently the appellant company failed to file the mandatory filings with the ROC for the preceding three Financial Years being 2013 to 2016. However, the said financial statements were prepared in the relevant year by the registered Charted Accountant appointed by the Appellant Company, the said documents were approved by the Appellant Company in its AGM dated 16.09.2014,15.09.2015,12.09.2016.
The appellant also submitted that the Directors of the appellant company were completely unaware about the said non compliance of the statutory requirement as they were under bonafide impression that the CA must have fulfilled his obligation. The appellant company further states that they have been diligently filing income tax returns in the preceding three financial years, the acknowledgment of FY 2008-09 to 2015-16 have been annexed herein. The appellant has been paying income tax regularly.
The appellant has come to know about the non-compliances only after the CA informed that the name of the appellant company was struck off from its Register by the Registrar of Companies.
The appellant have stated that the no notice under Section 248(1) of the Act in the form of STK-1, was received by the Company or any of the directors or any person on their behalf and hence not afforded any opportunity of being heard before striking of the name of the company.
However, without going into the controversy of the latches, in following the due procedure of law, by Registrar of Companies before the final act of striking off the name of the company from the register of companies maintained by Registrar of Companies, for non-filing of statutory documents by company for the relevant period, through publication of notice, the appellants have preferred to prove with documents and records that the company was in operation and doing business during the period of striking off the name of the company as a better remedy.
The Appellant has brought forward the following facts about it being in operation and functional during the period of striking off:
a) The copies of Financial Statements of the company for the financial years from 31.03.2014 to 31.03.2017. The Balance Sheet as on 31.03.2017 reflects -
i. Inventories of Rs. 1,70,84,400/-,
ii. Fixed assets of Rs. 25,49,438/-,
iii. Revenue from operations of Rs. 34,52,150/- and
iv. Profit of Rs. 1,62,083/-.
b) The company has incurred employee benefits expense of Rs. 8,79,410/-for the financial year ending on 31.03.2017.
c) The income tax return acknowledgment for the financial year 2008-09 to 2015-17.
The Registrar of Companies has stated that it has no objection if the name of the Company is restored on proving by the Company that it was carrying on business or was in operation and the Company be also directed to file financial statements up to date with appropriate filing and additional fees.
The Income Tax Department has submitted in its report that there are no outstanding against the assessee company and hence has no objection for the revival of the name of the company.
The Section 252(3) contemplates that one of the three conditions are required to be satisfied before exercising jurisdiction to restore company to its original name on the register of the Registrar of Companies namely:
a) That the company at the time of its name was struck off was carrying on business.
b) Or it was in operation
c) Or it is otherwise just that the name of the company be restored on the register.
The Appellant have submitted sufficient evidence that it has been in operation during the period of striking off and therefore could not be termed as defunct company. Thus, taking into consideration the provisions of Section 252(3) of the Companies Act, 2013 which vests this Tribunal with a discretion where the Company whose name has been struck off and such Company is able to demonstrate that there is a running business as on the date when the name was struck off and also keeping in consideration that it is just to do so can restore the name of the Company in the Register and in the interest of all stakeholders including the Appellant itself who seeks restoration of the name of the Company in the register maintained by Registrar of Companies, the company deserved to be restored.
Accordingly, this appeal is allowed. The Public Notice of Registrar of Companies striking the name of the company is set aside. The name of the Appellant Company shall then, as a consequence, stand restored to the Register of the Registrar of Companies, as if the name of the company had not been struck off in accordance with Section 248(1) of the Companies Act, 2013.
The appeal is disposed of accordingly.
Let the copy of the order be served to the parties.