Elin Motors India Private Limited And Anr. vs Registrar Of Companies, Pune

This present Petition has been filed under Section 252 (3) of the Companies Act, 2013 (Act) by Elin Motors India Private Limited through its Director Mr. Shajan Pailo Paul praying for restoring the name of the company in the Register maintained by the Registrar of Companies, Pune (RoC).

The Petitioner submits that the Petitioner company has been incorporated to carry out the following objects:

"to carry on business of manufacturers, importers, exporters, sellers, buyers and dealers whether as wholesalers or retailers of all kinds of electric motors and to undertake its repair and maintenance and to carry on the business of manufacturers....".

The Petitioner submits that the company was incorporated on 28.07.2014 under the Companies Act, 2013. The Appellant Company has been allotted CIN No. U31908PN2014FTC151954. The Company has failed to file its Financial Statements and Annual Returns for the Financial Years 2016- 17 and 2017-18 for two years.

The matter was heard on numerous occasions and vide an Order dated 08.09.2020 directed the Registrar of Companies to submit his report and directed the Appellant to communicate a copy of the Order to the Registrar of Companies. Thereafter matter adjourned to 15.10.2020.

Ld. Advocate for the Petitioner on the date of hearing 15.10.2020 submitted that the RoC report is received and the comments from Income Tax Department was awaited but the report was not submitted for the perusal of this bench. On scrutiny it was found that RoC had not filed its report.

The matter was again heard on 20.11.2020 on which occasion, again none appeared for the Registrar of Companies and the Appellant was once again requested to serve a notice on the Income Tax Department and to submit the proof of affidavit of service.

The matter was thereafter finally heard on 06.01.2021, once again none appeared for the Registrar of Companies and the matter was reserved for orders.

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. Therefore, the matter was heard on merits.

The Petitioner Company has enclosed the audited accounts for the Financial Years 2016-17, 2017-18 and 2018-19 to show that it is actively involved in the business and operations.

We had 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;"

However, upon the perusal of the financials, it is noted that there are no business operations and no assets in the Company since its incorporation. Further, it is also noted that as reflected in the Balance sheet, the Fixed Assets is Nil, Cash and Cash equivalent is only Rs. 39,128/- Long-term Provisions is Nil, Revenue from operations Nil, expenses towards cost of materials Nil, employee benefits expenses Nil, Other Expenses is only Rs. 73,450/- for the financial year ending 31.03.2019 and the Fixed Assets is Nil, Cash and Cash equivalent is Rs. 93,478/- Long-term Provisions is Nil, Revenue from operations Nil, expenses towards cost of materials Nil, employee benefits expenses Nil, Other Expenses is Rs. 59,370/- for the financial year ending 31.03.2018.

Therefore, in light of the above observations, this Bench is of the view that the Company is not carrying on any business or operations and there is no infirmity in the order of the Respondent for striking off the name of the Company from the Register of Companies maintained by it. Hench this appeal is liable to be rejected.

ORDER

Company Appeal CP No. 1035/252/MB/C-II/2020 filed by Appellant/Petitioner Elin Motors India Private Limited, through its Director Mr. Shajan Pailo Paul, seeking restoration of the company's name in the Register of the Companies maintained by the Registrar of Companies, Pune is dismissed.

All the above 'Nil' figures and factual details substantiate the criteria that the company is not carrying on any business or operation as defined under section 248 of the Companies Act 2013, therefore, the action taken by Registrar of Companies, Pune is justified, and the Bench did not find any ground to interfere with the action of striking off the name of the Company by Registrar of Companies, Pune. The Bench is also of the considered view that this type of companies only put the burden on the system, Government/ROC, by way of record keeping, ensuring compliance by these companies and at times these companies may be used for various purposes other than the purpose/object for which the company was originally incorporated. It also puts a burden on the company to comply with various regulatory/statuary compliances.

Considering the above facts and circumstances, practical aspects, the Bench has not found any justifiable/ reasonable grounds to interfere with the action taken by the RoC in respect of the petitioner company.