Leon Erphran Sims, And Ors vs Registrar Of Companies

Sucharitha R., J

This is an Application which has been filed by the Shareholder cum Director of the Applicant Company under Section 252(3) of the Companies Act, 2013 in relation to an order of "striking off" the name of the Applicant Company passed by the Respondent under the provisions of Section 248 of the Companies Act, 2013.

It is represented that the Applicant Company was incorporated on 06th August, 2014 under the provisions of Companies Act, 2013 and has its registered office at Reg. Office at No. 59/3, Subbarayan, 4th Street, Namalwarpet, Ramanujam Garden, Perambur Barracks, Chennai-600012. The main objectives of the Company are given in the Memorandum of Association it is engaged in the business of builders, realtors and contractors of apartments, flats, individual houses, schools, colleges, hospitals, shops hotels, restaurants, pub, cinema halls, multiplex complexes, malls hospitals and nursing home's buildings canals, reservoirs, mills and offices, huts etc. It is submitted that the Respondent has "struck off" the Applicant Company's name from the Register, due to the default in statutory compliances, namely, failure to file Financial Statements & Annual Returns since incorporation of the Company. It is further submitted that the Respondent has not followed the procedure prescribed under Section 248 (1) of the Companies Act, 2013, wherein a notice is required to be issued by the Respondent to the Applicant Company, however, the Respondent without complying with such provision has preferred to publish the name of the Applicant Company in the Official Gazette as prescribed under Section 248 (5) of the Companies Act, 2013.

The Applicant submitted that the Company has been active since incorporation and has also been maintaining all the requisite documentation, as per the provisions of the Companies Act, 2013. The Applicant Company further submitted that the non-filing of the Financial Statements and Annual Returns with ROC for the Financial Years since Incorporation was due to inadvertence and same was neither wilful nor wanton. In the mean time the applicant company's name had been "struck off" from the Register of Companies.

Upon notice to the Respondent, the ROC has filed its reply to the above said Appeal and has stated that -

(A) The Company may kindly be directed to prove that it was carrying on business or was in operation and that it is just that the name of the company be restored to the register.

(B) The company may kindly be directed to file the financial statements up to date in case if the prayer is granted.

(C) The shareholders of the subject company may be kindly be directed to give an undertaking stating that the accounts of the company were not used as means to transact tainted money during the period of demonetization.

(D) To pass such other orders as deemed fit and proper in the circumstances of the case.

We have considered the plea of the Applicant Company and the Respondent/RoC as well. It is contended by the Applicant Company that the Respondent has not followed the procedure prescribed under Section 248 (1) of the Companies Act, 2013, wherein a notice is required to be issued by the Respondent to the Applicant Company and no opportunity of being heard was given by the Respondent. However, in the Report filed by the Respondent, it is stated at para 1 to 9 that all procedures laid down in Section 248 of the Companies Act, 2013 and Companies (Removal of Names of companies from the Register of Companies) Rules, 2016, have been adhered to by the Respondent and the Applicant Company has also admitted the defaults committed.

For the purpose of restoration of its name in the register as maintained by RoC, the Applicant is relying on the ground that the Applicant Company as of date is carrying on the business for which it was incorporated and it is in operation and in the circumstances, it is just that the name of the Company should be restored on the register of RoC as maintained by the Respondent. In order to sustain the plea, the Applicant has placed before us the following evidences;

i) Income Tax Documents pertaining to the Assessment Year 2017-18, 2018-19 and 2019-20.

ii) Copy of the Audited Financial Statements for Financial Year 2014-15, 2015-16, 2016-17, 2017-18 and 2018-19. to be file with the ROC.

iii) Copy of GST Returns filed till January, 2020.

iv) Copy of Agreements rendering consultancy services entered with the clients.

As submitted by the Applicant, it is seen from the records as listed above that the Applicant Company has been functioning during the period when the name of the company was "struck off". However, even though it will not absolve the Applicant Company from filing the necessary returns and documents and adhere to the provisions of Companies Act, 2013 as an onus is placed on the Applicant Company to strictly comply with the provisions of Companies Act, 2013 without any let. Thus, taking into consideration the provisions of Section 252 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 into consideration that it is just, to restore the name of the Company in the register as it in the interest of all the stakeholders including members of the Applicant Company, its employees as well as the revenue and the petitioner itself seeks restoration of the name of the Company in the register being maintained by ROC.

Heard. Perused pleadings and documents filed in support of the contentions of both parties.

ORDER

Having satisfied with the reasons mentioned above. The Registrar of companies, Chennai, the respondent herein, is ordered to restore the original status of the Applicant Company i.e. M/s. S. A Constructions and Consultancy Private Limited as if the name of the company has not been struck off from the Register of Companies with resultant and consequential actions like changing status of Company from "strike off" to "Active"

The Company is directed to file all pending statutory document(s) including Annual Accounts and Annual Returns for the Financial Years Since incorporation onwards along with prescribed fees/ additional fee/fine as decided by ROC within 30days from the date on which its name is restored on the Register of Companies by the ROC subject to fees/late fees, if any.

The company's representative, who has filed the company Appeal, is directed to personally ensure compliance of this order.

The restoration of the Company's name is also subject to the payment of cost of Rs. 25,000/- (Rs. Twenty-Five Thousand only) through online payment in www.mca.gov.in under miscellaneous fee by mentioning particulars as "payment of cost for revival of Company."

The applicant is permitted to deliver a certified copy of this order with ROC, Chennai within 30 days of the receipt of this order.

On such delivery and after duly complying with above directions, the Registrar of Companies, Chennai is directed to, on office name and seal, publish the Order in the Official Gazette;

This Order is confined to the violations, which ultimately leads to the impugned action of "striking off" of the Company, and it will not come in the way of ROC, Chennai to take appropriate action(s) in accordance with law, other violations/offenses, if any, committed by the appellant company prior to or during the "striking off" of the company.

Accordingly, this Urgent application MA/430/2020 hereby allowed and Company Application No. 207/2020 is hereby disposed of.

Certified copy of this order, if applied for, may be issued uposn compliance with all requisite formalities