Surya Landcon Private Limited vs Registrar Of Companies And Ors

Hemant Kumar Sarangi, Member (T)

The present appeal is filed by the company M/s. Surya Landcon Private Limited (for brevity the 'Company'), through its Director, under Section 252 (3) 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 08.08.2018 vide notification No. ROC-DEL/248(5)/STK-7/4865 by Registrar of Companies, the respondent herein.

It is stated that the company is incorporated as a Private Limited Company with the Registrar of Companies, NCT of Delhi and Haryana, under the Companies Act, 1956 with CIN U70109DL2013PTC258853. The company has its registered office at R-808, New Rajendra Nagar, New Delhi-110060.

The Authorized Share Capital of the company is Rs. 1,00,000/- The issued, subscribed and paid up share capital of the Company is Rs. 1,00,000/- The main objects of the company are:

To purchase, acquire, take on lease or in exchange or in any other such lawful manner any land including agricultural land, buildings and structures and to develop the same and dispose of or maintain the same and build township, markets, commercial complex with all or related conveniences thereon and to equip the same or any part of other building, or any related amenities or conveniences.

To act as commission agents and dealers in farmland, building whether commercial, residential whether meant for purchase, sale, resale or let out.

And other main objects.

As per the notice of non-compliance of provision of the Companies Act, 2013 in respect to filing of annual returns and financial statements for financial years 2013-2014 to 2017-2018, 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 the Registrar of Companies due to inadvertance 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:

a) The copy of Bank Statements of the Company of ICICI Bank Ltd for the period 01.04.2014 to 03.09.2014 reflecting closing balance of Rs. 0/- as on 03.09.2014.

b) The copies of audited financial statements of the company for the financial years from 2013-14 to 2017-18. The Balance Sheet as on 31.03.2018 reflects Inventories of Rs. 13,482,100/- and Cash and Cash Equivalents of Rs. 12,219/-.

The appellant has also brought on record the copy of a sale deed executed on 09.06.2015, reflecting purchase of Agricultural land from M/s. Pakhi Land Realty Pvt. Ltd. Admeasuring 23 Bigha and 13 Biswa, bearing Mustatil No. 8(4-16), 11(4-9), 12(4-16), 13(4-16) and 18(4-16), situated in the Revenue Estate of Village Dhansa, Tehsil Najafgarh (now Kapashera), New Delhi, for a total sale consideration of Rs. 1,26,00,000/- (Rupees One Crore Twenty Six Lakhs).

During the course of hearing, the appellant has apprised the court that it has further sold the said agricultural land, through a sale deed executed on 19.03.2020 for a sale consideration of Rs. 89,50,000/-( Rupees Eighty Nine Lakhs Fifty Thousand). However it is still unclear how a stuck off company can undertake any activity. The same is to be examined by the Registrar of Companies and appropriate action should be taken.

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 professional guidance 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.

In spite of repeated opportunities being given to the Income Tax department since 13.11.2018 to file a reply in the present matter. They have not been able to file any reply. The present appeal stands adjudicated in the absence of any reply from the Income Tax department.

The records reveal that the present appeal was first heard by Court-II of this tribunal, however, due to lack of consensus, regarding allowing or disallowing of the appeal, between the Hon'ble Members of the bench, the matter was referred to the Hon'ble President, NCLT, who transferred it to Court-Ill. However, given the current situation of Covid-19, an urgent application was moved by the parties before this bench. The matter was listed before this bench and now is being decided by this bench and this order shall be construed as final and binding on all the parties herein.

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 and the Section 252(3) further contemplates that one of the above 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.

The Appellant has submitted sufficient evidence that it has been in operation since incorporation and therefore could not be termed as defunct company as per section 252 of the Act. 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 hereby declared illegal and 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. 50,000/- to be paid to PM CARES 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.