M/S. MAHI Hotels & Resorts Private Limited And Ors. vs Registrar Of Companies

This is an Appeal which has been preferred by the Appellant Company in relation to an order of striking off the name of the Appellant Company

passed by the Respondent with effect from 07.06.2017 under the provisions of Section 248 of the Companies Act, 2013. Ld Counsel for the Appellant

represents that the Appellant Company was incorporated under the provisions of Companies Act, 1956 and has its registered office at B-166, Second

Floor, East of Kailash, New Delhi 110065. The Company is primarily into the business inter-alia of building, renting, managing, promoting, and running

resorts, Hotels, Motel, Restaurant, Café, Tavern ,Beer House, Refreshment room and lodging House keepers, Wine, Beer and spirits merchants,

surveyors and caterer and to purchase the lands and premises. In relation to compliance with the provisions of Companies Act, 2013 with the

Respondent RoC by filing annual returns and financial statements it has been stated it has been omitted to be complied with and that the said omission

is not mala fide. However, in view of non-filing of the Annual returns and Financial Statement, the name of the Appellant Company from the register

as maintained by the RoC has been struck off on and from 07.06.2017 . That due to lack of professional guidance oversight, and inadvertent reasons,

the appellant company it is stated inadvertently missed filing of Annual Documents with Registrar of Companies for the last few years and

consequently the name of the company was struck off from the Registrar of Companies and in view of demonstration of continued operation of the

Company over the past years and its business being alive and running, it will seriously prejudice the interest of the Company and the Appellants and

that taking into consideration the compliances made by the Appellant in relation to other statutory authorities and since no one will be prejudiced if the

Appeal is allowed, but on the other hand, the interest of all concerned including shareholders/creditors, employees of the Company will be seriously

affected if the appeal is not allowed and if the name of the company in the register of the RoC is not restored.

Upon notice to the Respondent RoC, Roe has filed its reply to the above said Appeal. In paragraph 3 and 4 of the reply, the following has been

submitted:

3.That the company had not filed its Annual Returns and Balance Sheets since its incorporation.

4.That the subject company was strike off in terms of provision of section 248(1) of the Companies Act, 2013 read with Rule 7 of the

Companies (Removal of Names of Companies from the Register of Companies) Rules,201 6.

It is evidenced from the report/observations as filed by the Respondent and as represented by the Ld. Company Prosecutor that Appellant had not

filed its Annual Returns and Balance Sheets since its incorporation due to which the Respondent had reasonable cause to believe that the petitioner

company was inactive. Ld. Company prosecutor insisted that due process of law prior to striking off was strictly complied with and in view of the

Respondent not having received any communication from the Petitioner Company in response to the notice issued under sub-Section 1 and sub-

Section 4 of Section 248 of the Companies Act, 2013 and Rule 7 of the Companies (Removal of Names of Companies from the Register of

Companies) Rules, 2016, the Respondent was forced to follow the procedure for striking off and in the circumstances the decision for restoration is

being left to this Tribunal for its consideration.

In relation to income tax upon notice directed to be issued, Income Tax has filed its observations, and concluded to the following effect:

That the Appellant Company has filled its return of income only for Assessment Year 2016-17 to Assessment Year 2017-18 and no Income Tax

Returns for earlier Assessment Years have been filed. As per ITR filed, no business activity seems to have been carried out by the Assesse.

That the Income Tax Returns that have been filed i.e. for the A.Y. 2016-17 & 2017-18 have been only filed after the name of the company was

struck off from the register.

We have considered the plea of the Appellant on the one hand and the Respondent/ RoC as well as the representations of Income Tax Department

to whom notice was issued under the directions of this Tribunal. It is evident from the plea of the Appellant that the Appellant has questioned the

process undertaken by the Roe in striking off the name of the Appellant Company as envisaged under Section 248 of the Companies Act, 2013 read

with attendant Rules. However, the Appellant is seeking for the purpose of restoration of its name in the register as maintained by Roe is relying on

the ground that the Appellant 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 Roe as maintained by the Respondent. In order to sustain the said plea, the

Appellant has placed evidences by way of the following:

Copy of Balance Sheet as on 31.03.2014 to 31.03.2017, however indicating no revenue generated for the said periods.

Copy of Income Tax return acknowledgement for 2016-17 and 2017-18 filed on 12.03.2018 indicating neither income, loss nor any TDS

been deducted.

Copy of sale deed dated 22.02.2010, indicating purchase of land by the director Ms. Ka mini Verrna.

We have perused the documents filed by the Company. It is apparent from the financial statements filed by the Company that there was no

revenue generation in the Company for the years ended 31.03.2014 to 31.03.2017. Further, no bank account statements have been filed which would

demonstrate that the business operations are ongoing. None of the documents relied on show that the Company was actually carrying on any business

for the past two years. In fact, the lack of any revenue generation and any transactions relating to the business of the Company point towards the fact

that there were no operations ongoing in the company. Even though the Appellants have also filed a sale deed in relation to a property but it is in the

name of an individual, obviously indicating that the appellant company has not acquired the landed property and has been registered in the name of

individual. Further it is also evident that since incorporation of the Appellant Company it has not even chosen to file any returns with the respondent as

evident from the reply filed by ROC.

After hearing the Counsel for the Appellant Company and perusal of the material on record the report of the Registrar of Companies, Delhi and

ongoing through the provisions of section 252(3) of the Companies Act, 2013, this tribunal is of the view that the appellant company was a non-

functional company at the time of strike off its name even though it is presently represented that the company wants to be revive since the company is

in the process to start the business operations again.

In view of the fact that the Company has been unable to show that it was carrying on business or operations in the two immediately preceding

financial years and the Appellants have also not been able to establish any just clause, the action of the respondent RoC is not without basis and

justified and the appeal filed by the Company stands dismissed, without any order as to cost.