Purple Wines Pvt. Ltd. vs Registrar Of Companies, Ne Region, Shillong

Ashutosh Chandra, J

The above petition is filed under section 252(1) of the Companies Act, 2013, by Ms. Mamta Das, Director in and on behalf of Purple Wines Pvt. Ltd. (the Petitioner) against the striking off of the name of the company from the Register of Companies, and seeking restoration of the same.

Ms. Sareeka Jain, learned Company Secretary, appearing for the petitioner company has been heard and the facts of the case forming part of the petition, have been perused. Mr. Aswin N.S, JTA appearing for the respondent/Registrar of Companies (in short, ROC) has also been heard and his report is considered.

As per the petition, the said company was registered by the ROC on 3rd June 2004, to start works contracts and other business, but the same could not be commenced. It had an honest belief that it would be in a position to start its business and place its statutory returns before the concerned authorities, including the ROC. It failed to file its annual returns and Balance Sheet since 2010 (but the true affairs of the company are reflected in its duly audited Balance Sheet up to 31st March 2018). It is also stated that due to unavoidable incidents and medical reasons the same could not be filed before the ROC and it remained under the belief that the Returns would be allowed to be filed with the payment of late fees/additional fees. Copies of the Balance Sheet have been filed with the petition. However, the ROC, on noticing the non-filing, struck off the name of the company from his register. It is stated that the company is targeting commencement of the business as per the objects for which it was incorporated. It is submitted that the purpose of section 252(3) is to give a chance to the company, its members and creditors to revive the company so struck off, within a period of 20 years and give them an opportunity to carry on their business. Hence, the present petition may be allowed, otherwise the company and its shareholders will suffer irreparable loss and hardship. The following relief have been prayed for on the basis of the above facts:

A. Pass appropriate order to admit the petition.

B. Pass appropriate order directing the respondent to restore the name of the company in the register with immediate effect in terms of section 252(1) of the Companies Act, 2013.

C. Pass order in terms of section 252(1) of the Companies Act, 2013 that is just and appropriate placing the company and all other all other persons in the same position as may be as if the name of the company has not been struck off.

D. Pass such other and further orders as it may deem fit and proper in the facts and circumstances of the case.

A report was called for from the Respondent/ROC, on the above petition, and he has filed his report on 09.08.2019, which does not contain any objection to the plea of the petitioner, nor are the facts disputed. The matter has been left to the discretion of this Tribunal, subject to giving the following directions to the applicant, to:

i) Comply with all statutory provision of Companies Act, 2013 and file its statutory returns as per the Law prescribed within 30 days of the restoration order being passed.

ii) Company will not change its existing shareholders and management for a minimum period of 5 years from the date of order however, further shares can be issued to the existing shareholder only and to the legal heirs in case of their death.

iii) To pay the restoration cost of not less than Rs. 10,000/- (Rupees Ten Thousand only) payable to the Ministry of Corporate Affairs, Government of India since new company is registered with authorized Capital of Rs. 2,00,000/- (Rupees Two Lakhs only) they may have to pay registration fees.

On hearing both the parties, and on a consideration of the circumstances as mentioned in the 'facts of the case' which are a part of the petition, particularly paragraph 4 a) to m) thereof, and the report of the ROC dated 09.08.2019, we are of the view that the company was prevented by reasonable cause in filing its statutory returns, being in the belief that it would be able to commence its business, and that it could file its returns on payment of additional fees. Also, that non restoration of the name of the company in the ROC's register now would harm the possibility of the company doing its business as per its objects. No other grave act of commission has been brought to our notice that would militate against the admission of the petition and restoration of its name in the Register of Companies. As per the submissions made and filed, particularly at para 4 i), that the case of the petitioner falls under section 252(3) of the Act, we are of the view that this matter would indeed be covered under that provision and not under section 252(1), and that it would be just that the prayer made in the petition for restoration of its name in the Register of Companies be accepted.

Accordingly, the name of the petitioner company is directed to be restored in the register of the ROC, within the meaning of section 252(3) of the Act, placing the company and all other persons in the same position, as nearly as may be, as if the name of the company had not been struck off, subject to the following conditions:

i) The petitioner company shall comply with all statutory provisions of Companies Act, 2013 and file its statutory returns as per the Law prescribed, within 30 days of the restoration order being passed.

ii) The petitioner company will not change its existing shareholders and management for a minimum period of 5 years from the date of order. However, further shares can be issued to the existing shareholders only and to the legal heirs in case of their death.

iii) The petitioner shall pay restoration cost of Rs. 10,000 (Rupees Ten Thousand only) payable to the Ministry of Corporate Affairs, Government of India within 30 days from the date of this order.

iv) The petitioner company shall file an affidavit in due course affirming that the aforesaid directions are complied with.

The petition is allowed, as above.