Micron Flora Pvt. Ltd. vs Registrar Of Companies And Anr.

This appeal is filed by the company, M/s Micron Flora Private Limited (for brevity the ‘Company’), through its director, Mr. Vikram Sahgal

under Section 252(1) of the Companies Act, 2013 (for brevity ‘the Act’) against the order of striking off the name of the company passed by

the respondent under section 248 (1) of the Act read with Rule 7 of Companies (Removal of Names of Companies from the Register of Companies)

Rules, 2016 published on 30.06.2017 vide notification no. ROC-DEL/248(5)/STK-7/2879 by Registrar of Companies, the respondent herein.

The company is incorporated as a Private Limited Company under the provision of Companies Act, 1956 with the Registrar of Companies, NCT of

Delhi and Haryana on 08.12.2004 having CIN U01122DL2004PTC131056.

The company is having registered office at P-4/90 Connaught Circus, New Delhi.

Authorized share capital of the Company is Rs. 1,00,000/-divided into 10,000 equity shares of Rs.10/- each and issued, subscribed and paid up share

capital of the Company is Rs. 1,00,000/- divided into 10,000 equity shares of Rs.10/- each.

The main objects of the company are:

i. To undertake the cultivation and growing of flowers, fruits on commercial scale on owned land and/or leased land. To undertake contract farming in

floriculture and horticulture on owned land/or leased land acquired from private parties, government agencies and non-governmental organizations. To

store, purchase, sell, import, export, distribute flowers and horticulture produce. To carry on the business of bio and agro products, mainly floriculture

and horticulture in India and abroad. To advise and provide consultancy services to concerned organizations/agencies on afforestation.

And other main objects.

As per the notice of non- compliance of provisions of the Companies Act, 2013 in respect to filing of annual returns and financial statements since

incorporation, the name of the company was struck off in terms of provision of Section 248(1) of the Companies Act, 2013 read with Rule 7 and Rule

9 of the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016.

The Appellant has submitted that the company was in operation and the business activities were carried out by the company during the period of

striking off since the activities of the company was agricultural and floricultural nature, there was not much turn over and profits reaped by the

company in fact due to seasonal and other factors company went into losses and all attention of management was concentrated on reviving the

business name. Further the reporting of such activities through Annual Returns and Financial Statement had not been filed with Registrar of

Companies due to inadvertence on part of the management.

The appellants have stated that no notice under section 248(1) of the Act in the form of STK-1 was received by the Company or any of the

directors or any person on their behalf.

However, without going into the controversy of the latches in following the due procedure of law by Registrar of Companies before the final act of

striking off the name of the company from the register of companies maintained by Registrar of Companies, for non-filing of statutory documents by

company for the relevant period, through publication of notice on 30.06.2017, the appellants have preferred to prove with documents and records that

the company was in operation and doing business during the period of striking off the name of the company as a better remedy.

The Appellant has brought forward the following facts about it being in operation and functional during the period of striking off:

i. The copies of financial statements of the company for the financial years from 31.03.2014 to 31.03.2016. The Balance Sheet as on 31.03.2016

reflects fixed assets of Rs. 2,78,59,321 /- and Loss of Rs. 38,000/-

ii. The copy of Income Tax Return filed for the assessment year 2016-17 as NIL return, which is the only return filed from 2012.

iii. The copy of the five sale deeds, dated 27.04.2006 in favor of the company, situated at Mauza Asgarpur, Sub Tehsil Sadhora, Tehsil Jagadhri,

District Yamuna Nagar, Haryana for total consideration of Rs. 55,76,000/-.

iv. The copy of the two sale deeds, dated 19.06.2006 and 08.12.2006 in favor of the company, situated at Mauza Ogli, Tehsil Nahan, District Sirmour,

Himachal Pradesh for total consideration of Rs. 28,02,600/-.

It is further submitted by the Appellants that the failure to file financial statements and annual returns with the Registrar of Companies, NCT of

Delhi and Haryana was due to inadvertence on part of the management and due to lack of professional guidance and as such there was no wilful or

mala-fide motive behind non-filing of the Financial Statements and Annual returns.

The Registrar of Companies has stated that it has no objection if the name of the Company is restored on proving by the Company that it was

carrying on business or was in operation and the Company be also directed to file financial statements up to date with appropriate filing and additional

fees.

The Income Tax Department has submitted in its report that the income tax return has not been filed for the assessment year 2012-13 to 2015-16

and 2017-18 and return for the assessment year 2016-2017 is pending for processing at CPC, Bangalore against the Assessee but has no objection if

the company is considered for revival.

The Section 252(3) contemplates that one of the three conditions are required to be satisfied before exercising jurisdiction to restore company to its

original name on the register of the Registrar of Companies namely:

i. That the company at the time of its name was struck off was carrying on business.

ii. Or it was in operation

iii. Or it is otherwise just that the name of the company be restored on the register.

The Appellant have submitted the only evidence of immovable property that it has been in operation since incorporation but incurring losses can

lead us to believe that it could not be termed as defunct company. Thus, taking into consideration the provisions of Section 252(3) 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 in consideration that it is just to do so can restore the

name of the Company in the Register and in the interest of all stakeholders including the Appellant itself who seeks restoration of the name of the

Company in the register maintained by Registrar of Companies, the company deserved to be restored.

Accordingly, this appeal is allowed. The Public Notice of Registrar of Companies striking the name of the company is set aside. The restoration of

the company’s name to the Register of Registrar of Companies is ordered subject to its filing of all outstanding documents with proper filing fees

along with additional fees required under law and completion of all formalities, including payment of any late fee or any other charges which are

leviable by the respondent for the late filing of statutory returns, and also subject to payment of cost of Rs. 25,000/- to be paid to Prime Minister’s

Relief Fund. The name of the Appellant Company shall then, as a consequence, stand restored to the Register of the Registrar of Companies, as if the

name of the company had not been struck off in accordance with Section 248(1) of the Companies Act, 2013.

The appeal is disposed of accordingly.

Let the copy of the order be served to the parties.