Spread Infotech Consultants Private Limited And Ors. vs Registrar Of Companies And Anr.

This appeal is filed by the company, M/s Spread Infotech Consultants Private Limited (for brevity the ‘Company’), through and by its

Directors, Mr. Chandra Prabha and Mr. Ravindra Singh Chauhan 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 13.06.2017 vide notification no. ROC-DEL/248/STK-

5/2336 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 03.09.2004 having CIN U72200DL2004PTC128803.

The company is having registered office at V-545, Street No. 16, Vijaya Park, Delhi-110005.

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 consultancy pertaining to parts, systems, software, accessories and management of information technology and other

technologies business, all kinds of computers, chips, hardware, software, networking, electronic adapt processing, e-mail, advanced technologies,

satellites, field and businesses connected with satellite, launch and maintenance systems, space technologies and business, communication, mass

communication, internet, world wide web, research and development in all areas, all interest, web and computer based business and related support

businesses, electronic commerce, electronic, optical, electronic magnetic and other devices, servicing in India or abroad, on earth or in space.

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, 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 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 31.03.2017. The Balance Sheet as on 31.03.2017

reflects cash and cash equivalent of Rs. 12,848,160/- and Loss of Rs. 3,000/-

ii. The copies of Income Tax Returns filed for the assessment year 2017-18 as NIL returns.

iii. The copy of the application being CS (COMM.) No. 771/2016, filed by the appellant company against M/s ZTE Kangxun Telecom, pending before

the Hon’ble High Court of Delhi and also annexing copies of orders dated 30.11.2017 and 31.01.2018. The next date of hearing is 06.03.2018. The

copy of the application is annexed with the appeal. Thus from 2016 till 2018 various proceedings before the Hon’ble High Court of Delhi are

pending, proving that the company was in operation.

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 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 there an outstanding demand of Rs.68,31,365 against the Assessee and in pursuant to

that the company has filed an affidavit that the appellant company intends to challenge the demands raised by the income tax department and on

restoration of name of the company, the company will contest the demands and in case the demand still is not aside, the appellant company undertakes

through its directors to pay the demands.

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.

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.

Further it is seen that due to pending aforesaid litigation, the survival and functioning of the company was jeopardized. It is established from various

judgements that pending litigations can be considered as valid and just reason to revive the company as cited in order of the Honourable High Court of

Delhi in Company Petition 406/2009 dated 04.06.2010; Honourable High Court of Guwahati in Company Petition 24/2012 dated 05.06.2017; order of

Honourable High Court of Delhi in Company Petition No. 200 of 2011 dated 08.02.2012, and order of Honourable High Court of Delhi in Company

Petition No. 185/2008 dated 21.04.2010, which held as under:

“When a litigation is pending by or against a company, it is only proper that its name be restored to the Register to enable the matter to

be carried to its logical conclusionâ€​

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

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.