Calcutta Rubber Factory Pvt Ltd & Ors vs Registrar Of Companies , Delhi & Haryana

3. Charanjeet Singh S/o Shri Ranbir Singh, J-9/18C Rajouri Garden, New Delhi. Appellants

Vs.

Registrar of Companies, Delhi and Haryana, 4th Floor, IFCI Tower, Nehru Place, New Delhi. Respondent

For Appellant:- Mr. Ashish Middha, Advocate

For Respondents: - Mr. P.S. Singh, Sr. Central Govt Counsel for ROC.

JUDGEMENT

(6th December, 2019)

JUSTICE JARAT KUMAR JAIN, MEMBER (JUDICIAL)

This appeal is preferred by Calcutta Rubber Factory Pvt Ltd and its

directors/shareholders against the order passed by NCLT, New Delhi on

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4.6.2019 by which dismissed the appeal and affirmed the order of Respondent

ROC striking the name of the company from the register of companies.

2 Appellant No.1 company was incorporated under the provisions of

Companies Act, 1956 on 06.05.1980 and its registered office is at A-21

Mayapuri Industrial Area, Phase II, New Delhi. Appellant No.2 and 3 are

erstwhile directors and shareholders of the company. The company is into the

business of manufacturers, distributors, dealers, stockists, repairers,

importers and exporters of all kind of tyres, tubes, flaps, moulded rubber

parts, valve body, cast iron wheels, retreading materials, rubber gums etc.

The appellant company had applied for the allotment of industrial land to

HUDA and on 03.03.2014 HUDA allotted 300 sq meters land bearing Plot

No.327H, Sector 37 II, Gurgaon and for the same directors had paid money

from their bank account. Though the company had not filed its annual

returns and financial reports after the period ending on 31st March, 2013 but

such reports and returns are ready with the appellants.

3. Respondent, ROC served the notice under Section 248 of the

Companies Act, 2013 on 27.3.2017 to the appellant company. However, the

notice returned undelivered with postal remark "Left". Thereafter, a public

notice was issued and with effect from 3.06.2017 the company's name was

struck off from the register of the companies.

4. The order was challenged in the appeal before the NCLT, New Delhi.

NCLT has called the report from Income Tax Department about the income

tax returns of appellant company. Department has submitted the report.

NCLT after perusal of the record found that the appellant company was a non-

Company Appeal (AT) No.177 of 2019 3

functional company at the time of strike off its name. Since the company is

having immovable property which is only reflected in the Balance Sheet for

the year ending 31.03.2018 i.e. after striking off. Hence NCLT has dismissed

the appeal by the impugned order dated 04.06.2019.

5. Learned counsel for the appellants submits that ROC has not complied

the mandatory provisions of Section 248(1) of Companies Act, 2013 which

provides that before passing any order under Section 248(1) ROC shall send

a notice to the company and all the directors of the company of his intention

to remove the name of the company from the register of the companies and

requesting them to send a representation within a period of 30 days from the

date of notice. Sub-rule (2) of Rule 3 of the Companies (Removal of Names of

Companies from the Register of Companies) Rules, 2016 provides that the

Registrar shall give a notice in writing in form No.STK-1 to all the directors of

the company at the address available on record, by registered post with

acknowledgement due or by speed post. It reflects from the notice STK1 dated

17.03.2017 that the address of director Ranbir Singh and Charanjit Singh

was available on record. However, the notices were not served with them.

Thus the respondent has not complied the mandatory prescribed procedure.

It is also submitted that the NCLT failed to appreciate that before passing the

order the Respondent has not recorded his satisfaction as per Section 248(6)

of the Companies Act, 2013.

6. Learned counsel for the appellant further submitted that the appellant

company has a plot of 300 sq Meters allotted by HUDA. The company is

paying the property tax of the plot, receipts are annexed with the appeal. The

Company Appeal (AT) No.177 of 2019 4

company was not doing well and was running into losses which accumulated

to Rs.630589/- for the year ending 31st March, 2013. It is true that the

annual returns and financial reports after the period ending on 31st March,

2013 have not been filed but such reports and returns are ready with the

appellant. NCLT has not considered the documents placed on record. Hence

the order striking off the name of the company be set aside.

7. Learned counsel Shri P.S. Singh, Sr. Central Govt Counsel support the

impugned order and submitted that the appellant company was incorporated

in the year 1980 and on 3.3.2014 land was allotted to company by HUDA even

though the company is not doing any business and had not filed the Income

Tax returns for the assessment year 2012-13 to 2015-16. The company has

not filed the audited annual accounts since 2013 onwards. Thus the

appellant company is not carrying on any business and ROC has rightly

struck off the name of the company from the register.

8. Having heard learned counsel for the parties, we have carefully

examined the documents.

9. Sub-section (1) of Section 248 of Companies Act, 2013 provides that

where the Registrar has reasonable cause to believe that a company is not

carrying on any business of operation for a period of two immediately

preceding financial years and has not made any application within such

period for obtaining the status of dormant company under Section 455 then

he shall send a notice to the company and all the directors of the company of

his intention to remove the name of the company from the register of

companies and requesting them to send their representation alongwith the

Company Appeal (AT) No.177 of 2019 5

copies of relevant documents within 30 days from the date of notice.

Admittedly ROC has served notice dated 17.3.2017 to company's registered

address which returned unserved. In the notice name of company's directors

i.e. Appellant No.2 and 3 and their address are mentioned, however, no notice

have been sent to them by the ROC. It is true that in the notice

No.ROC/DEL/248(1)/STK1 dated 17.3.2017 which was sent to company it is

mentioned "that the notice is also treated as having been served on the

directors of the company in terms of the provisions of Section 20 of the

Companies Act, 2013". We are of the view that this is not the compliance of

mandatory provisions under sub-section (1) of Section 248 of Companies Act,

2013 and the Companies (Removal of Names of Companies from the Register

of Companies) Rules, 2016.

10. Due to non-compliance of this provisions the appellants could not send

their representations alongwith relevant documents before the ROC. Before

passing the order ROC has not recorded his satisfaction as per provisions

under sub-section (6) of Section 248 of Companies Act, 2013.

11. The company is having a lease hold plot allotted by HUDA and the

appellant company undertakes to file the returns and the financial statements

after the period 2012-13. The company was carrying on business but was

running into losses which accumulated to Rs.630589/- from the year ending

31st March, 2013 and loss of Rs.3500/- and Rs.3500/- from the year ending

as on 2016-17, 2017-18. From these facts it cannot be said that the company

is not carrying on any business.

Company Appeal (AT) No.177 of 2019 6

12. From the above discussions and observations we have come to the

conclusion that it would be just that the name of the company is directed to

be restored. The following orders/directions are passed:-

i) Impugned order is quashed and set aside. The name of the appellant

No.1 company shall be restored to the Register of Companies subject to the

following compliances:

ii) Appellants shall pay costs of Rs.1,00,000/- (Rupees One lac only) to

the Registrar of Companies, New Delhi within 30 days.

iii) Within 30 days' of restoration of the company's name in the register

maintained by the ROC, the company will file all their annual returns and

balance sheets due for the period ending 2012-13 to date. The company will

also pay requisite charges/fee as well as late fee/charges as applicable.

iv) Inspite of present orders, ROC will be free to take any other steps

punitive or otherwise under the Companies Act, 2013 for non-filing/late filing

of statutory returns/documents against the company and directors.

The appeal is accordingly allowed.

(Justice Jarat Kumar Jain) Member (Judicial)

(Mr. Balvinder Singh) Member (Technical)

(Dr. Ashok Kumar Mishra) Member (Technical) New Delhi bm

Company Appeal (AT) No.177 of 2019