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Judgment
Vivek Singh Thakur, J
Petitioner has approached this Court, by way of instant petition, seeking direction to respondent Registrar of Companies (in short ROC) to activate his Director Identification Number (DIN) 00054014 and to revoke the disqualification of petitioner under Section 164(2) of the Companies Act, 2013 (hereinafter the Act).
2 Petitioner has been Director of nine companies, detailed in Annexure A-1. He was allotted Director Identification No. (DIN) 00054014 by the respondent.
3 Petitioner was appointed as Additional Director on the Board of Company named UG Hotels and Resorts Ltd. (in short UG Hotels) w.e.f. 18.7.2007. The Directorship was subject to confirmation in the Annual General Meeting(AGM) of said Company for the financial year 2007. Annual General Meeting of UG Hotels in the year 2007-08 was held on 17th November, 2007, but in that meeting agenda of conferment of Directorship of petitioner was not notified, enlisted, considered or approved. Copy of notice of Annual General Meeting with detail of business to be conducted therein has been placed on record as Annexure P-2 to substantiate this fact. Therefore, Directorship of petitioner of UG Hotels seized on the date of AGM of UG Hotels.
4 Another Company Umak Investment Company Private Limited (n short Umak) was an unsecured creditor of UG Hotels. For an interse dispute between Stakeholders, Directors and Creditors of UG Hotels, adjudicatory process was initiated at the instance of Umak, and Company Law Board (now NCLT) vide order dated 31.1.2014, appointed Justice Manmohan Sareen retired Chief Justice, J&K High Court as Administrator of the UG Hotels. Copy of order has been placed on record as Annexure P-3.
5 The Administrator, appointed vide order dated 31.1.2014, filed an application CA No. 512/19 seeking exemption from filing Annual Returns of UG Hotels along with other documents electronically with the Registrar of Companies (ROC) for financial year 2015-16 onwards and also from complying with notification issued by Ministry of Corporate Affairs (MCA) detailed in application.
6 The aforesaid application was allowed by National Company Law Tribunal (NCLT) Chandigarh on 19th July, 2019 accepting the prayer of exemption from statutory compliances as prayed including filing of Annual Returns as well as holding Annual General Meeting(s) for the years 2015-16, 2017-18 and 2019-20.
7 The aforesaid development was not brought in the notice of respondent ROC. Resultantly, petitioner was disqualified by ROC for the period from 1.11.2018 to 31.10.2023 for appointment as Director of Company for not filing financial statement or annual returns of UG Hotels for continuous period of three financial years, invoking notifying provisions of Section 164(2) read with Section 167 of the Act.
8 It happened for the reason that Board of Directors of UG Hotels as well as Administrator did not inform about discontinuation of Additional Directorship of petitioner in UG Hotels for its non-confirmation in Annual General Meeting held on 17.11.2007, and also for not furnishing information to ROC regarding appointment of Administrator of Company by NCLT in adjudicatory process of dispute between Umak and UG Hotels as well as exemption granted by NCLT to UG Hotels.
9 Petitioner vide communication dated 13.12.2019, submitted to ROC, had requested for removal of his disqualification, by explaining reasons, discussed supra, with respect to his appointment as Additional Director of UG Hotels w.e.f. 18.7.2007, discontinuation thereof on 17.11.2007 and appointment of Administrator and exemption granted by NCLT vide order dated 19.7.2019 to UG Hotels from filng various e-forms and convening AGM(s). For getting no response to said communication, petitioner submitted reminder dated 8.10.2020 with request to remove his disqualification and activate his DIN so as to make him eligible for re-appointment as Director in other Company(ies).
10 Prayer of petitioner has been opposed on the ground that as per available record of Ministry of Corporate Affairs’ Portal the petitioner is still a Director of UG Hotels in list of signatories available on Portal and his DIN has been de-activated disqualifying him for the period w.e.f. 1.11.2018 to 31.10.2023 for not filing annual returns or financial statements of UG Hotels and further that petitioner was disqualified w.e.f. 2018, whereas, exemption by NCLT was granted to UG Hotels vide order dated 19.7.2019. Therefore, exemption granted by NCLT cannot be made basis for removal of disqualification, as prayed.
11 Learned counsel for petitioner has also placed on record a print-out of E-mail received in December 2021 from ROC Chandigarh with respect to representation dated 31.12.2019 submitted by petitioner. In the E -mail, it has been communicated that once a Director is disqualified under Section 164(2) read with Section 167, then his Directorship can only be restored by order of competent Court or by end of disqualification period i.e. 31.10.2023.
12 Certain facts i.e. items of ordinary business notified to be considered in Annual General Meeting dated 14.11.2007 of UG Hotels and absence of agenda therein with respect to appointment/conferment of petitioner as Additional Director/Director of said Company, dispute between Umak and UG Hotels, initiation of adjudicatory process in pursuant thereto, appointment of Administrator by Company Law Board (now NCLT) and exemption by NCLT to UG Hotels from filing annual returns and other documents from financial year 2015-16 onwards, are not in dispute.
13 Petitioner has been disqualified on 1.11.2018 for not filing annual returns. Plea of respondent that exemption was granted to UG Hotels on 19th July, 2019, but, petitioner was disqualified w.e.f. November, 2018 and therefore, petitioner cannot seek benefit of exemption is not tenable for the reason that vide order dated 19th July, 2019, exemption to UG Hotels was granted w.e.f. financial year 2015 onwards and therefore, disqualification of petitioner for not filing returns after 2015-16 onwards is not tenable, more particularly when Administrator had been approved by CNB/NCLT on 31.01.2014.
14 For failure on the part of UG Hotels either through Board of Directors in the year 2007 or lapse on the part of Administrator after his appointment vide order dated 31.1.2014 to inform the competent authority including Ministry of Corporate Affairs and ROC, cannot be made basis to punish the petitioner for no fault on his part.
15 Though, by placing on record Anneuxre R-1 i.e. signatories details of UG Hotels downloaded from MCA Portal, it has been claimed that till date petitioner is being reflected as signatory of Company, however, perusal of this document reveals that Directorship of petitioner has been reflected as expired on 8.3.2020. Whereas, in print out of Portal of MCA with respect to DIN status of petitioner placed on record is Annxure P6 with petition, wherein petitioner has been reflected as disqualified under Section 164(2) of the Act by ROC w.e.f. 1.11.2018 to 31.10.2023.
16 ROC, Board of Directors as well as Administrator are responsible for updating the Portal, but for any wrong information being displayed on Portal of MCA, petitioner cannot be made to suffer.
17 In view of aforesaid discussion, particularly for exemption granted by NCLT to UG Hotels, petitioner is entitled for removal/revocation of his impugned disqualification and for activation of his Director Identification Number(DIN), as prayed.
18 Accordingly, writ petition is allowed directing the respondent to remove/revoke the disqualification of petitioner under Section 164(2) read with Section 167 of Companies Act and to activate his Director Identification Number (DIN) 00054014 with immediate effect.
Petition stands disposed of accordingly along with all pending miscellaneous application(s), if any.