Vimlesh Rani vs Registrar Of Companies And Anr.

The present appeal is filed by Ms. Vimlesh Rani (for brevity the ‘Appellant’), under Section 252 of the Companies Act, 2013 (for brevity

‘the Act’) against the order of striking off the name of the company M/s Sumant Tradecom Private Limited (for brevity the ‘Appellant

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 on

16.06.2008 under the Companies Act, 1956 with CIN U51109DL2008PTC179591.

The company is having its registered office at 1089 D, New Friends Colony, New Delhi- 110065.

The Authorized Share Capital of the company is Rs. 5,00,000/- divided into 50,000 equity shares of Rs.10/-each. The issued, subscribed and paid up

share capital of the Company is Rs. 1,00,000/- divided into 10,000 equity shares of Rs.10/-.

The main objects of the company are:

To carry on the business as traders, purchasers, sellers, importers, exporters, contractors, distributors, agents, brokers, factors, stockists, commission

agents and dealers of readymade garments, agro products, consumer goods, engineering goods, machine tools, small tools, metals alloys, iron pipe

fittings, nuts and bolts, marine products, all types of industrial and other preparations and articles and all other goods.

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 2015-16 to 2016-2017, 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.

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 the ill health of Managing Director/ founding director of the company Mr. Vishwa Prakash, who himself was looking

after the statutory compliances which were carried out by the company before the Registrar of companies as well as other statutory authorities. Since

March 2015, Late Mr. Vishwa Prakash was diagnosed with serious ailment and the entire family including the appellant went into immense mental

trauma and financial hardships, due to which the affairs of the running company could not be attended till the demise of Mr. Vishwa Prakash in

August 2016.

The Appellant has brought forward the following facts about company being in operation and functional during the period of striking off:

a) The copy of Bank Statements of the company of Canara Bank for the period 01.04.2015 to 03.03.2018 showing various transaction details of the

company and reflecting closing balance of Rs. 53,60,178/- as on 03.03.2018.

b) The copies of financial statements of the company for the financial years from 31.03.2015 to 31.03.2017. The Balance Sheet as on 31.03.2017

reflects tangible assets of Rs. 68,491/- and Cash and Cash equivalents of Rs. 47,716/-.

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 ITR filed for assessment year 2014-15 is defective and ITR is yet to be processed.

No Income Tax Returns after the assessment year 2014-15 are filed.

In this regard, the appellant company has filed a rejoinder dated 11.01.2019 wherein it is stated that appellant company was allotted an apartment

vide possession letter dated 27.02.2014 bearing unit reference no. P8-1002 in Pavilion Courts at Jaypee Green, Noida by Jaiprakash Associates

Limited against the payment of the total sale consideration of Rs. 68,37,908/-. That despite receiving the possession letter and making all the payments,

actual possession of the said apartment has not been handed over to the appellant company, therefore the appellant company treated such assets for

accounting purposes as Capital advances and not as Fixed Assets in its Balance sheet.

Subsequently appellant company had entered into an agreement to sell dated 25.02.2018, of said apartment situated at Sector 128, Noida, Distt.

Gautam Budh Nagar, U.P. in favour of M/s AMM DES Associates Pvt. Ltd. against the total sale consideration of Rs. 53,50,000/- (Rupees Fifty-

Three Lakhs Fifty Thousand only) which was duly received by the appellant company. Since the appellant company has not handed over the actual

possession of the said apartment to M/s AMM DES Associates Pvt. Ltd., therefore the appellant company treated such assets for accounting

purposes as Capital advances and not as Fixed Assets in its Balance sheet. Copy of the said agreement to sell is annexed with the appeal.

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(1) 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. 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.