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Judgment
Justice Anant Bijay Singh;
The present Appeal under Section 421 of the Companies Act, 2013, has been filed by the Appellants being aggrieved and dissatisfied by the order dated 26.07.2021 passed by the National Company Law Tribunal, New Delhi Bench (Court-II) in Appeal No. 51/252(ND)/2021 whereby and whereunder Appeal filed by the Appellants for restoration of the name of the Appellant Company in the register maintained by the Registrar of Companies, NCT of Delhi and Haryana (the ‘ROC’), was dismissed by the Tribunal.
The facts giving rise to this Appeal are as follows:
The Appellant Company was incorporated on 18.04.2011 under the provision of Companies Act, 1956 with the Registrar of Companies, NCT of Delhi and Haryana and its registered office is situated at New Delhi-110092. The Appellant No. 1 company is in the business of trading of Organic Food and other allied Products and other hospitality related services and also built its reputation and Goodwill over the years and is known for its name in the market. The Appellant Company has preferred the present Appeal, through its Authorized Representative/Authorized Signatory namely Anuj Tandon who is duly authorized vide its Board Resolution to institute, file, verify and proceed with the present Appeal against the Respondent. The Appeal has been filed by the Appellant No. 1 Company whose name has been struck off and certificate of Incorporation has been cancelled. The other Appellant is the members of the Appellant No. 1 Company at the time of striking off the name of the Appellant No. 1 company from the Register of Members by the Respondent.
ii) The Respondent has struck off/remove the name of the Appellant company from the Register of Members and cancelled the Certificate of Incorporation in complete negligence of the statutory requirement which is well enumerated under Section 248 Sub-section (1), (2) & (3) of Companies Act, 2013.
iii) The Appellants did not receive any individual notices from the Respondent under Section 248 of Companies Act, 2013. The Appellant company is having its registered Office at New Delhi-110092 and in compliance of the aforesaid statutory provisions, the Respondent/Registrar was required to send the notices, at the Registered office of the Company. Pertinent to mention that the Appellant company had not shifted its registered office at any other place since incorporation. The Respondent/RoC had not passed any order for its satisfaction as enumerated under Section (6) of Section 248 of the Companies Act.
iv) The Appellant No. 1 company was a going concern at the time of striking off its name from the Register of members by the RoC/Respondent and to substantiate, the Appellant had annexed imperative documents such as Audited Balance Sheet, Financial Statements, GST Certificate, Independent Auditor Report and Bank Account Statements in the Appeal filed before the NCLT by the present Appellants under Section 252 of the Companies Act, pertaining to its functioning during the time when RoC/Respondent in complete violation of the Statutory provisions under Companies Act, 2013 had strike off its name from the Register of Companies.
The operations of the Appellant company are well enumerated. As per Audited Balance Sheet as on 31st March, 2018 which are annexed as Annexure-2 of the Appeal Paper Book. In view of the aforesaid figures, it is imperative to note that the Appellant company despite of having income from operations in the year 2017 and 2018 and incurred other expenses was being struck off by the RoC/Respondent upon vague, false allegations of being inactive and that too without any corroboration. Further, as per bank Account Statement for the Financial years 2017-18 as especially for the month of June, 2017 i.e. at the time of Striking off the name of the Appellant company by the RoC/Respondent which are annexed as Annexure-3 of the Appeal Paper Book. In view of the aforesaid transactions, it is pertinent to note that the Appellant Company was actively involved in business transactions at the time of Striking off the name of the Appellant Company by the RoC/Respondent vide its Circular dated 30.06.2017.
vi) Moreover, the Respondent/RoC had to mandatorily comply with the aforesaid statutory provisions before striking off the name of the Appellant Company. The Registrar/Respondent published the list for the companies whose name were removed from the Register of Members vide its circular/letter dated 30.06.2017. The act of Registrar of Companies/Respondent is per se bad and illegal. The ROC/Respondent had not followed the procedure as prescribed by Section 248 of the Companies Act, 2013.
vii) The Appellant No. 1 company was preparing all its returns etc. and was relying on the professional to file the same. To the utter shock to the Appellants when it was apprised to them that the name of Appellant No. 1 Company was struck off and removed from the Register of Companies by the Respondent. The Appellant No. 1 company was maintaining its bank accounts with Yes Bank and State Bank of India for more than Five Years and the transaction in it had been done till the year 2017.
viii) The Appellants filed Appeal before the NCLT against the order of striking off the name of the Appellant No. 1 company from the register maintained by the RoC/Respondent and after hearing the parties the NCLT dismissed the Appeal filed by the Appellant for restoration of the name of the Appellant Company in the register maintained by the Registrar of Companies, NCT of Delhi and Haryana which led to filing of this Appeal.
The Learned Counsel for the Appellant during the course of argument and grounds taken in his memo of Appeal submitted that the order impugned dated 26.07.2021 passed by the NCLT is bad in law as the said order has been passed based on incomplete disclosure of complete facts of the case without providing an opportunity to the appellants to clarify and the same is in violation of the principles of natural justice. Further, the Tribunal has erred in passing of the impugned order dated 26.07.2021 as the Respondent has got struck off/removed the name of the Appellant Company from the Register of Members and cancelled the Certificate of Incorporation in complete negligence of the statutory requirement which is well enumerated under Section 248, Sub-section (1), (2), (3) & (6) of the Companies Act, 2013.
It is further submitted that the Tribunal had overlooked the fact that the appellant company was actively participating in business transaction at the time of striking of its name from the Register of Companies by the Respondent/RoC as evident from the Audited Balance Sheet as of 31.03.2018 and Bank Account Statement for the financial years 2017-18. Further, the Tribunal had overlooked the fact that the RoC/Respondent had not complied with the statutory provisions of Section 248(6) of the Act which says that the Registrar, before passing an order under sub-section (5), shall satisfy himself that sufficient provision has been made for the realisation of all amount due to the company and for the payment or discharge of its liabilities and obligations by the company within a reasonable time and, if necessary, obtain necessary undertakings from the managing director, director or other persons in charge of the management of the company.
It is further submitted that the RoC/Respondent in complete violation of Section 248(6) of the Companies Act, 2013 published notice dated 30.06.2017 as per section 248(5) of the Companies Act, 2013.
It is further submitted that the Tribunal in complete disregard to the aforesaid statutory provisions wherein the Respondent/RoC was required to send a Notice to the Appellant and allow them to give their response in the stipulated time period, had vide order dated 26.07.2021 declined to interfere with the striking off action taken by the RoC/Respondent against the Appellant Company under Section 248(5) of the Act. The Respondent had no complied with Section 248(1)(e) of the Act in order to issue notice to the company and all the directors of the company, of his intention to remove the name of the company from the register of companies and requesting them to send their representations along with copies of the relevant documents, if any, within a period of thirty days from the date of the notice.
It is further submitted that the income of the Appellant Company from operations i.e. Rs. 62,33,226.54/- is evident in the Audited Financial Statement for the year ended 31.03.2018 and the same was of Rs. 5,77,334.92/- in the Financial Statement for the year ended 31.03.2018.
It is further submitted that the Appellants undertakes to file the imperative documents such as Annual Returns and duly audited Financial Reports with the MCA along with the Additional fee, if any, on its revival. If the name of the Appellant No. 1 company is not revived then the same would cause prejudice to the Appellant and shall suffer irreparable loss in terms of the Appellant No. 1 company goodwill earned.
Based on above submissions, the impugned order is fit to be set aside and the instant Appeal be allowed.
On the other hand, the Respondent / Registrar of Companies during the course of argument and in his reply, it is stated that the Appellant company has not filed any annual Returns and Balance Sheet. Moreover, no subsequent documents had been filed by the company with this office to obtain the status of a “Dormant Company” under Section 455 of the Act. Hence, that office had reasonable cause to believe that the company was not in operation, and therefore, the name of company was considered for striking off from the Register of Companies.
It is further stated that this office of the RoC issued the notice in the form of STK-1 in the month of March, 2017 intimating the company and the directors of the company about the aforesaid defaults, providing them a fair opportunity to respond. Subsequently, this office also issued public notice for the same in the form of STK-5 dated 24.08.2017 and public notice published in Hindustan Times newspaper on 27.04.2017. Thereafter, the name of the company was struck off as per the provision of Section 248(1)(c) of the Act read with Rule 9 of the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 vide Notice in the form of STK-7 dated 07.06.2017.
As per the information provided by the Appellants with application, it is observed as under:
| Sr No. | Particulars | Remarks |
|---|---|---|
| 1. | Revenue from Operations | As per the profit & Loss A/c submitted with the Petition: F.Y 2016-17 showing Revenue as Rs. 577334/- F.Y. 2017-18 showing Revenue as Rs. 6281205.54/- |
| 2. | Audited Financial Statement | Submitted with the Petition for the financial years 2017-18 only. |
| 3. | Bank Statement | Submitted with petition from 03/04/2017 to 24/01/2018 |
It is further stated that in view of foregoing facts and circumstances of the case, if this Tribunal consider the application for restoration of name of the company, this Tribunal may issue directions to the Appellants to file all the pending Annual Returns and Balance Sheets of the subject company with the Registrar of Companies within such time as specified by this Tribunal. Further, this Tribunal may please award cost in favour of the Respondent (Registrar of Companies) as the Appellants failed to file its statutory returns with the Respondent under the Companies Act, 2013.
After hearing the parties, going through the pleadings made on behalf of the parties and in view of the fact that the Audited Balance Sheet as on 31st March, 2018 and Bank Account Statement for the Financial Years 2017-18 and especially for the month of June, 2017 show that the Appellant No. 1 Company was actively involved in business transactions at the time of Striking off the name of the Appellant No. 1 Company by the Respondent vide its Circular dated 30.06.2017. Therefore, it cannot be said that the Appellant No. 1 Company is not carrying on any business or operations. Hence, we are of the view that the order passed by the National Company Law Tribunal, New Delhi Bench (Court-II) as well as Registrar of Companies, NCT of Delhi & Haryana is not sustainable in law.
In view of the aforenoted, we set aside the impugned order dated 26.07.2021 passed by the National Company Law Tribunal, New Delhi Bench (Court-II) in Appeal No. 51/252(ND)/2021. The name of the Appellant Company be restored to the Register of Companies subject to the following compliances:
Appellant Company shall pay cost of Rs. 1,00,000/- (Rupees One Lakh) to the Registrar of Companies, NCT of Delhi & Haryana, within eight (8) weeks from the passing of this judgment.
ii) After restoration of the Company's name in the Register maintained by the Registrar of Companies, the Company shall file all their Annual Returns and Balance Sheets. The Company shall also pay requisite charges/fee as well as late fee/charges as applicable.
iii) Inspite of present orders, Registrar of Companies will be free to take any other steps punitive or otherwise under the Companies Act, 2013 for non-filing/late filing of statutory returns/documents against the Company and Directors.
The instant Appeal is allowed to the above extent. I.A, if any, stands disposed of.
Registry to upload the Judgment on the website of this Appellate Tribunal and send the copy of this Judgment to the National Company Law Tribunal, New Delhi Bench (Court-II), forthwith.