Sanjay Bhatia, Ex-Director And Ors. vs Registrar Of Companies And Anr.

This appeal is filed by the erstwhile Directors of the company M/s Sunbeam Buildtech Private Limited (for brevity the ‘Company’), 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 27.04.2017 vide notification no. ROC-DEL/248/STK-5/721 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 12.12.2008 having CIN U74120DL2008PTC185790.

The company is having registered office at L-11, Malviya Nagar, 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 carry on the business of contractors, builders, town planners, estate developers, engineers, land developers, land consolidation, land scrapers,

estate agents, immovable property dealers and to buy, purchase, lease, consolidate, exchange, hire or otherwise, land, buildings, civil works, immovable

property of nay tenure or any interest in the same and to erect and construct houses, flats, bungalows, Kothi’s, commercial complexes, shopping

malls. Multiplexes, food courts or civil work of any type on the land o the company or any other land or immovable property whether belongings to the

company or not and to pull down, rebuild, enlarge, alter nay other conveniences and to deal with and improve the immovable property of the company

or any other immovable property in India or abroad.

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 but 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 and hence not afforded any opportunity of being heard before striking of the name of the company.

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 copy of Bank Statement of company issued by HDFC Bank, from 20.11.2012 to 07.06.2017, reflecting various transactions done by the

company during the period of striking off and having closing balance of Rs. 27,648/-

ii. The copies of financial statements of the company for the financial years from 31.03.2012 to 31.03.2017. The Balance Sheet as on 31.03.2017

reflects fixed assets of Rs. 43,00,000/- and Profit of Rs. 2,50,317/-

iii. The copy of sale deed, dated 05.07.2013 executed between Mr. Chetan Sharma as seller in favour of the appellant company, for the property

situated at 134, Paraphery Road, Opposite Nh-3, Sanjay Gandhi Memorial Nagar, Faridabad admeasuring about 200 square yards for total

consideration of Rs. 40,00,000/- and the said property is reflected in the balance sheet of the year 2016-2017.

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 coordination with the professionals 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 no ITS can be traced as there is no scrutiny pending and a survey proceeding under

section 133A of the IT Act, was conducted regarding cash deposit during demonetization but has no objection if the company is considered for revival.

The grounds contemplated under section 252 of Companies Act, 2013 namely, that of the company carrying on business or was in operation at the

time of striking off its name, and where it appears “just†to the adjudicating authority that the name of the company is to be restored to the

Register of Companies. It is also seen from the perusal of the provisions under Section 252(3), that if Tribunal is of the opinion it is “just†that the

name of the company is to be restored to the register of companies maintained by Registrar of Companies, such orders can be passed for the name of

the company to be so restored. For reference, the provisions of Section 252(3) of the Companies Act, 2013 is extracted hereunder:

252(3) “If a company, or any member or creditor or workman thereof feels aggrieved by the company having its name struck off from the

register of companies, the Tribunal on an application made by the company, member, creditor or workman before the expiry of twenty years

from the publication in the Official Gazette of the notice under sub-section (5) of section 248 may, if satisfied that the company was, at the

time of its name being struck off, carrying on business or in operation or otherwise it is just that the name of the company be restored to the

register of companies, order the name of the company to be restored to the register of companies, and the Tribunal may, by the order, give

such other directions and make such provisions as deemed just for 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 from the register of companies.

Further, relying on the following Judgement, namely, order of Honourable High Court of Delhi in Company Petition No. 174/2013 dated

02.12.2013, which in brief reflects the following:

“The Court is of opinion that it is “otherwise just†that the company be restored to the register in case of an immovable property,

restoration can be ordered.â€​

Where immovable property rights are involved and in the instant case also the facts vouch for the similar decision, it is only proper that the name of

the company be restored to the Register of Companies.

Hence, there exists a “justâ€​ ground for the restoration of the name of the appellant company in the Register of Registrar of Companies.

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 sufficient evidence that it has been in operation since incorporation and therefore 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.