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Judgment
This Appeal has been filed by the Company named "Seema Buildtech Private Limited" hereinafter referred to as "the Appellant Company" invoking the provisions of Section 252 (3) of the Companies Act, 2013 (the Act) for restoration of the name of the Company in the Register maintained by the Registrar of Companies (RoC), NCT of Delhi & Haryana. The company has authorised capital of the Appellant-company is Rs.3,00,000/- and paid up share capital of Rs.3,00,000/-.
As per the averments, M/s. Seema Buildtech Private Limited was incorporated on 04.03.2011 as a private limited company and has its registered office at H.No.14, Block-C, Gali No.17,West Vinod Nagar, Aggarwal Sweet, Delhi-110092 having GIN No.U45200DL2011PTC215207.
Since incorporation, the appellant-company has been carrying on business to lay out, develop, construct, build, erect, demolish, alter ,repair or do any other such civil and constructional work in connection with any building or building scheme, roads, highways, sewers, bridges, canals, dams, reservoirs, embankments, irrigations, improvements, sanitary, water electric work and power supply works or any other such structural or architectural work related thereto and for such purpose to prepare estimates, designs, plans, specification or models related thereto.
To purchase, acquire, take on lease or in any other such lawful manner, buildings and structures and to develop the same and dispose of or maintain the same and build townships, markets, commercial complex with all or related conveniences thereon and to equip the same or any part of other buildings or any related amenities or conveniences such as drainage and to act as commission agents and dealers in farm land buildings whether commercial, residential whether meant for purchase, sale, resale or let out.
A sweeping action was initiated by the ROC at the instance of MCA in striking off the names of several Companies who had failed to file their Statutory Returns. The appellant had failed to file its Financial Statements and Annual Returns for the Financial Years from 2015-16 and F.Y. 2016-2017 thereby giving rise to the surmise that the business of the company was not in operation. Consequently, its name was struck off by the Respondent from the Register of Companies under Section 248 of the Companies Act, 2013 vide Notice No. ROC-DEL/248/STK-5/2018/2912 dated 18.06.2018 followed by struck off Notification No. ROC/ DELHI/248(5)/STK-7/2912 dated 08.08.2018.
The appellant -company admitted their default in carrying out the statutory compliances but submits that the same was due to lack of professional guidance, inadvertence and oversight. However, the appellant has submitted copies of its Financial Statements and Annual Returns for 2015-2016 and 2016-2017 with the petition and original submitted to the respondent.
The Appellant submits that the Appellant Company has some active work projects with name(s) "The Hemisphere" by Royalgold Link CItyProjects Private Limited and "Express Green Group Housing" by Express Plroperties Private Limited for which the company had entered into Work Order Agreement on 10.02.2018 and 21.01.2014 respectively. The Appellant-company is doing /operating its business and achieved turnover of Rs.23,472,146/- in FY 2017-18, and Rs.36,264,746/- in FY 2016-17 and Rs.,36,338,280/- in FY 2015-16.
In order to corroborate above submissions the petitioner has placed before us the following evidence:
i) The Company has submitted Copies of Audited financial statements for the period ending 2015-16, 2016-17 and 2017-18 along with Audited balance sheets and Auditors reports, GST Invoices, Bank Statements from HDFC Bank and Indian Overseas Bank for the above periods with the petition and submitted to the respondent. Appellant has undertaken to file the pending reports.
ii) The Appellant-company attached copies of Form 26AS of Income-tax for the years, 2016-17 ,2017-18 and 2018-19 with the petition and acknowledgements of Income-tax Returns for the A.Y. 2016-17 (Tax paid Rs.46,61,103/-) and for A.Y. 2017-18 (Tax paid Rs.,5,56,614/-).
iii) The Current Assets, Revenue from Operations, Employees Benefit Expenses and Profit Before Tax for the company from 2016-2018 have been given as follows in the Audited Financial statements:-
Assets
Revenue from operations
Employees Benefit Expenses
Profit Before Tax
Ending 31.3.2016
19557060
36338280
7414452
(1411896)
Ending 31.3.2017
35887310
36264746
8735946
1087508
Ending 31.03.2018
29872602
23472146
6448867
(2858624)
The income-tax department vide letter dated 15.05.2019 issued "No Objection" to the restoration of the Appellant-company's name in the Register of ROC.
Details of credit balance in the Appellant-company's Account with HDFC Bank as on the dates mentioned against them:-
Date
Cr. Balance With HDFC Bank
Date
Indian Overseas Bank
05.04.2016
604505
05.04.2016
40149
31.12.2016
336024
30.03.2017
129303
31.03.2017
615121
14.03.2018
40129
30.12.2017
85198
31.03.2018
173980
The matter came up for hearing before the Bench on 05.03.2021 and the Order was reserved.
The provisions pertaining to restoration of the name of the company has been provided in Section 252 of the Companies Act, 2013 which includes that, if it is just and equitable to restore the name of the company in the Registrar of Companies, it may direct the RoC to restore the name in its Register.
The appellant has been able to satisfy this Bench that it has complied with the statutory requirements and has certain assets which necessitate and justify restoration of its name in the Register of Companies. A step as stringent as what has been taken at least requires an opportunity to the appellant to take remedial measures. Merely to disallow restoration on grounds of its failure to file annual returns would neither be just nor equitable. As per several decisions of various Courts it should only be in exceptional circumstances that Courts should refuse restoration where the company has been struck off for its failure to file annual return as that would be excessive or inappropriate penalty for that oversight.
Accordingly, the appeal is allowed subject to payment of costs of Rs.25,000/- to the Prime Minister Relief Fund. The restoration of the Appellant Company's name in the Register will be subject to their filing all outstanding documents for the defaulting years as required by law and completion of all formalities, including payment of any late fee or other charges which are leviable by the respondent for the late filing of statutory returns. The name of the petitioner company shall then stand restored in the Register of the Registrar of Companies (RoC), as if its name of the company had not been struck off.
The direction for freezing the Bank Account(s) of the Appellant company, if on this ground, shall consequently be also set aside immediately to enable the company carry out its business operation. Compliance of this order for restoration shall be made by the respondent with all its consequential effects within one week of compliance by the appellant.
The appeal is allowed and disposed of accordingly.
Let the copy of the order be served to the parties.