M/s Sark Infraprojects Private Limited vs Registrar of Companies, West Bengal

KANTHI NARAHARI, MEMBER (TECHNICAL)

The Present Appeal is filed by invoking provisions of Section 421 of the Companies Act, 2013 against the order dated 25^th November, 2019 passed by the National Company Law Tribunal, Kolkata Bench, Kolkata in CP (Appeal) No. 947/KB/2019 under Sections 252(3) of the Companies Act, 2013 whereby the National Company Law Tribunal (in short ‘NCLT’) dismissed the Application filed by the Appellant herein.

The Learned Counsel for the Appellant submitted that aggrieved by the aforesaid order, the Appellant preferred the present Appeal and narrated the brief facts.

It is submitted that the Appellant filed the Application before the NCLT under Section 252(3) of the Companies Act, 2013 for restoration of name of the Appellant Company in the Register maintained by the ROC, West Bengal.

It is submitted that the ROC, West Bengal issued notice under Sub-section (1) and (4) of Section 248 of the Companies Act, 2013 in Form STK-5 dated 29.06.2018 whereby it is stated that the companies as mentioned in Annexure-A have not been carrying on any business or operation for a period of two immediately preceding Financial Years and have not made any application within such period for obtaining the status of dormant company under Section 455 of the Companies Act, 2013. Further it is stated that it proposes to remove/strike off the name of the companies as mentioned in Annexure-A from the Register of Companies and will be dissolved unless a cause is shown to the contrary within 30 days from the date of notice.

It is submitted that in Annexure-A to the aforesaid notice, the name of the Appellant Company stands at Sl. No.7090.

It is submitted that thereafter the ROC, West Bengal issued Form No. STK-7 under sub-section (5) of Section 248 of the Companies Act, 2013 dated 24.08.2018 stating that the companies as per the list attached as Annexure-‘A’ have this day i.e. 24.08.2018, been struck off from the Register of Companies and the said companies are dissolved. The name of the Appellant Company stands at Sl. No. 4510 of Annexure-‘A’. The reasons shown for striking off from the Register of Companies is that the Appellant Company and the similarly placed companies have not been carrying on any business or operation for a period of two immediately preceding years.

It is submitted that the NCLT observed that there is not just reason to restore the name of the Company on the Register of Companies for the reason that the Company is not an active company and not carrying on any business for which it was incorporated. Accordingly, the application of the Appellant was dismissed.

It is submitted that the Company was incorporated as a Private Limited on 01.04.2009 and as per the provisions of the Companies Act, 1956, the company acquired its prime assets viz. Real Estate unit in Kolkata and the Company is in operation since its incorporation as per the objectives of the Appellant’s Articles of Association. The Company duly filed the Annual Returns, Balance Sheet and Income Tax Returns for the Financial Years prior to and till 31.03.2013. However, due to unavoidable circumstances the Appellant Company inadvertently delayed in performing statutory compliances in accordance with the Companies Act for the Financial Years 2015-16 and 2016-17.

It is submitted that the Appellant Company is a functional and carrying out operations and activities and also paid Income Tax Returns for the Financial Year 2017-18 prior to issuance of notice under sub-section 4 of Section 248 dated 29.06.2018. The Company also filed balance sheets for the FY 2016-17, 2017-18 and 2018-19 and also filed Income Tax Returns for the aforesaid Financial Years.

It is submitted that the NCLT has not considered the documents filed there at, to establish that the Appellant Company had filed the Annual Returns, Balance Sheets and Income Tax Returns for the Financial Years 2015-16, 2016-17 and 2017-18, thereby it complied the statutory requirement as per law.

The Learned Counsel further submitted that there is no other reason for striking off the name of the Appellant Company except as stated in the notice that the Company is not in operation for a period of two immediately preceding Financial Years.

In view of the submissions as made above the Learned Counsel prayed this Bench to allow the Appeal by setting aside the impugned order.

The Learned Counsel appearing for the ROC filed its Reply among other pleas it is also stated at para 7 of the Reply, that the name of the Company which is struck off from the Register of ROC can be allowed to be revived under Section 252 of the Companies Act, 2013. However, the Appellant may be directed to file all the pending statutory returns with the additional fees within 30 days from the date of passing of the order, failing which the ROC may be directed to strike off the name of the Company again without giving any notice to the Appellant.

Heard the Learned Counsel appeared for the respective parties, perused the pleadings and documents. The short point for consideration is whether the Appellant has made out any ground to allow the Appeal as prayed for.

On the facts relating to incorporation and filing of statutory compliances till 31.03.2015, it is not in dispute. The ROC, West Bengal issued notice under Section 248(1) of the Companies Act, 2013, by which almost 10,650 companies are shown that they are in default. Further, as per the said Annexure-‘A’ the only reason shown that the Companies as mentioned in Annexure-A have not been carrying on any business or operation for a period of two immediately preceding Financial Years and have not made any application within such period for obtaining the status of dormant company under Section 455 of the Companies Act, 2013. However, the ROC provided 30 days’ time from the date of notice for showing a cause contrary to the reason as mentioned in the aforesaid notice. However, the ROC vide its Form STK-7 dated 24.08.2018 struck off the names of 7145 Companies from the Register of Companies and stated to be dissolved w.e.f. from the said date.

From the notice dated 29.06.2018, it is seen that there is no specific charge made against the Appellant Company except non-compliances of statutory requirement. Neither the case of the ROC nor NCLT that there are certain complaints against the company with regard to its activities and it is carrying on business which is prejudicial to the public interest. The only ground for striking off the name of the Appellant Company is that the Appellant Company is not in operation for two years immediately preceding Financial Years.

From the records, it is seen that the Appellant Company filed its statutory compliances as per law. Whilst the NCLT though in its order at para 3 observed that the Appellant Company enclosed/annexed with the Appeal the copies of the Annual Returns, Balance Sheet and Income Tax Returns for the Financial Years 2015-16, 2016-17 and 2017-18 and 2018-19. Despite sufficient evidence placed before it, the NCLT failed to consider the same on merits.

Even though the law provides for striking off the name of the Company for non-complying the statutory requirement as stipulated under Section 248 Companies Act, 2013, the statute also provides Section 252 of the Act to prefer an Appeal to the Tribunal by the aggrieved person against such dissolution of the Company. The Appellant rightly exercised its jurisdiction under Section 252 of the Companies Act, 2013 before the NCLT. This Tribunal is of the opinion that the removal of the name of the company from the Register of Companies is not justified. Under Section 252 of the Act, the NCLT can exercise its power to restore the name of the Company, upon considering that the ROC passed the order striking off the name of the company from the Register, in absence of any sufficient grounds as specified in Section 248, provided an opportunity to be afforded to the Registrar and the Company and all the concerned persons thereto.

As stated, (supra) there is no other ground except as mentioned in the notice dated 29.06.2018 for striking the name of the Appellant Company suo motu. The reasons for not restoring the company and dismissing the application of the Applicant is in our view not a sound ground.

Viewed in the perspective this Tribunal comes to a resultant conclusion that the impugned order dated 25.11.2019 passed by the NCLT, Kolkata Bench, Kolkata is set aside.

Accordingly, the Appeal is allowed. No order as to costs. Applications, if any, stands disposed of.

The ROC, West Bengal is hereby directed to restore the name of the Appellant Company to the Register of Companies, West Bengal subject to the following compliances:

Registry of this Tribunal is directed to upload the Judgment on the website of this Appellate Tribunal and also send a copy of this Judgment to the National Company Law Tribunal, Kolkata Bench, Kolkata, forthwith.