Krishana Kumar Aggarwal vs The Registrar Of Companies

[Arising out of the Order dated 28th September, 2021 passed by the NCLT (National Company Law Tribunal, Court - V, New Delhi), in Appeal 16/252/ND/2021]

IN THE MATTER OF:

Krishana Kumar Aggarwal S/o Brij Lal Aggarwal, R/p. 80, Shibtalla Street, Bhadrakali, 2nd Floor Hoogly, West Bengal. ...Appellant.

Versus

The Registrar of Companies NCT of Delhi & Haryana 4th Floor, IFCI Towers, Nehru Palace, New Delhi - 110019. ...Respondent.

Present

For Appellant: Ms. Reema Jain and Mr. Ankur Dugar, Advocates. For Respondent: None.

JUDGEMENT

(Through Virtual Mode) [Per: Ajai Das Mehrotra, Member (T)]

1. The present Appeal has been filed under Section 421 of the Companies

Act, 2013, (hereinafter referred to as the `Act') against the Impugned Order

dated 28.09.2021 passed by the NCLT (National Company Law Tribunal,

Court - V, New Delhi) in Appeal 16/252/ND/2021. Before the NCLT, the

Appeal was filed by the Directors of the Company namely Krishna Kumar

Aggarwal and Chetan Aggarwal, for restoration of the name of the Company

Garg Medical Solutions Private Limited in the register maintained by the

Registrar of Companies (`RoC'). The registered office of the Company is -2-

situated at S-196, Shakarpur, Delhi - 110092 and the CIN No. is U241 00DL

2009 PTC1 93436.

2. The relevant facts, as reproduced in the Order of NCLT dated

28.09.2021 are reproduced below:

"2. The major facts are given below:

Strike off Date 08.08.2018 (Pg 135 of petition) Audited The Company has submitted Financial audited financials for FY 2016-

Statements 17 to 2018-19 (pg 56 and 89 of petition), which show nil Revenue form Operations.

3. A RoC in its reply dated 16.03.2021, objected to restoration of the name of the Company in view of the fact that the Company had not been in business as was evident from nil revenue from operations during the FY 2016-17 to 2018-19 (pg 3 of RoC reply), which resulted in striking of the name. In fact, the Company had nil revenue from operation since the FY 2016-17.

Even after FY 2016-17, the Company had nil revenue from operation during FY 2016-17 to 2018-19 (pg 56 and 89 of petition).

4. On the perusal of the order dated 23.03.2021, we notice that an opportunity was given to the IT Dept to file the report but till 11.08.21, no report had been filed. The case was finally heard and order was reserved on 11.08.21. The Company had filed Financial Statements for FY 2016-17 to 2018-19 and has not produced any other evidence that it has been a going concern when the name of the Company was struck off."

3. NCLT observed that the Company seems to be defunct Company as it

has NIL revenue from operations during the Financial Year 2016-17 to 2018-

19 and has not attached any evidence to show filing of any Income Tax

Returns during the last decade and accordingly the Appeal was dismissed.

4. The Counsel for the Appellant submitted that Registrar has ignored the

provisions of Section 248(6) of the Act whereby the Registrar had to satisfy

himself that sufficient provisions has been made for realisation of all amount

due to the Company and for payment of discharge of its liability and Comp. App. (AT) No. 03 of 2022 -3-

obligations. As on 31.03.2018, the Company had unsecured Creditors

totalling Rs.21 Lakhs/- reflected in its Balance Sheet. It was further

submitted that on the date when the Company was struck off i.e., 08.08.2018,

the due date for filing of accounts for Financial Year ending on 31.03.2018

was not over, as the filing was due in September, 2018 onwards. The

Appellant claimed that it had done all the Statutory Compliance and filing of

the Financial Year ending 31.03.2017. Thus, the Appellant submitted that

there was no ground for striking off the Company on 08.08.2018. The Counsel

for the Appellant further submitted that the Company owns a Fixed Asset in

the form of the Property situated at Flat No. 502, Unit-A, Block - I, Fourth

Floor, Indraprastha Apartments - I, Residential Group Housing, situated at

Indraprastha Colony, Sector 30-33, Faridabad, Haryana, for which payment

of Rs. 48 Lakhs/- has been made in the period 03.12.2010 to 12.09.2014.

The Counsel for the Appellant further submitted that their case is different

from that of `Alliance Commodities Pvt. Ltd.' Vs. `Office of Registrar of

Companies, West Bengal in Comp. App. (AT) No. 20 of 2019, decided by

this Tribunal as the Appellant is not a shell Company and is not indulging in

any unlawful business. The Counsel for the Appellant submitted that it is

equitable and just to restore the Company - Garg Medical Solutions Pvt. Ltd.

and he is supported by the following Judgements by coordinate Benches of

this Tribunal:

• `Mr. Deorao Shriram Kalkar' Vs. `Registrar of Companies, Pune',

Comp. App. (AT) No. 188 of 2019.

• `Manmohan Singh Anand' Vs. `The Registrar of Companies &

Ors.', Comp. App. (AT) No. 88 of 2020.

Comp. App. (AT) No. 03 of 2022 -4- • `Taru Projects Private Limited & Ors.' Vs. `The Registrar of

Companies & Ors.', Comp. App. (AT) No. 15 of 2022.

• `N K Jain Realbuild Pvt. Ltd.' Vs. `The Registrar of Companies',

Comp. App. (AT) No. 147 of 2021.

• `Sudesh Gupta' Vs. `Registrar of Companies, NCT of Delhi &

Haryana & Ors.', Comp. App. (AT) No. 218 of 2020.

5. Learned Counsel representing the Office of the Registrar of Companies

NCT of Delhi and Haryana submitted that the Company - Garg Medical

Solutions Pvt. Ltd. was incorporated on 21.08.2009 and the last Annual

Return of Balance Sheet submitted by the Company to the office before it was

considered to be struck off pertains to Financial Year ending on 31.03.2017.

It was submitted that no subsequent documents have been filed by the

Company to obtain the status of `Dormant Company' under Section 455 of

the Act. The RoC had issued Notice in STK - 1 on 18.06.2018 and thereafter

the name of the Company was struck off as per provisions of Section 248(1)(c)

of the Act read with Rule 9 of the Companies (Removal of Names of Companies

from the Register of Companies) Rules, 2016 vide Notice in the form of STK -

7 dated 08.08.2018. It was submitted by the Learned Counsel for the

Respondent that the Appellant had failed to demonstrate that they were

carrying on any business operation before it was struck off. From the

Auditor's Report of 2016-17, 2017-18 and 2018-19 it is observed that

Revenue from operations was NIL. The Respondent relied upon the decision

of this Tribunal in the matter of `Alliance Commodities Pvt. Ltd.' Vs. `Office

of Registrar of Companies, West Bengal in Comp. App. (AT) No. 20 of

2019, which was confirmed by the Hon'ble Supreme Court vide Order dated

23.09.2019.

Comp. App. (AT) No. 03 of 2022 -5-

6. We have gone through the submissions of the Appellant and

Respondent and have perused the records. The said Company was struck off

on 08.08.2018. The Appellant had complied with the statutory filing for the

Financial Year 2016-17 and statutory filing for Financial Year 2017-18 was

not due. The said Company had outstanding payable to three Creditor

totalling to Rs.21 Lakhs/-. The said Company is also owing one Immovable

Property. We have also gone through the decisions of the coordinate Benches

cited by the Appellant as also the decisions of the coordinate Bench in the

case of `GRS Properties Private Limited' Vs. `Office of Registrar of

Companies, NCT of Delhi & Haryana', in Comp. App. (AT) No. 165 of 2021

and `Calcutta Rubber Factory Pvt. Ltd. & Ors.' Vs. `Registrar of

Companies, Delhi and Haryana', 2019 SCC OnLine NCLAT 851, wherein

restoration of the Company was considered just and equitable on the grounds

that the Company is having Assets.

7. The relevant portion of the Judgement of this Tribunal dated

08.02.2023, in Comp. App. (AT) No. 165 of 2021, in the matter of `GRS

Properties Private Limited' Vs. `Office of Registrar of Companies, NCT

of Delhi & Haryana', is reproduced below for reference:

"7. After hearing the parties, going through the pleadings made on behalf of the parties and in view of the fact that the Audited Financial Balance Sheets of the Year 2015-16, 2016-17, 2017-18, 2018-19 & 2019- 20 of the Appellant /Company shows that the Appellant/Company is having substantial movable as well as immovable assets. Therefore, it cannot be said that the Appellant/Company is not carrying on any business or operations. Hence, we are of the view that the order passed by the National Company Law Tribunal (New Delhi, Bench-V) as well as Registrar of Companies, NCT Delhi & Haryana is not sustainable in law."

Comp. App. (AT) No. 03 of 2022 -6- 8. The relevant portion of the Judgement of this Tribunal dated

06.12.2019, in the matter of `Calcutta Rubber Factory Pvt. Ltd. & Ors.' Vs.

`Registrar of Companies, Delhi and Haryana', 2019 SCC OnLine NCLAT

851, is given below for ready reference:

"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.

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........."

9. In the present case, the Company had complied with the statutory

filings till Financial Year 2016-17 and the statutory filings for Financial Year

2017-18 were not due as on the date of striking off of the Company. The

Company is having assets and liabilities. It owns one property and has liability

to repay credits of Rs.21 Lakhs/- Since the Company has substantial assets

and liabilities, it cannot be said that the Company is not carrying on any

business for operations.

10. Considering the facts and circumstances of this case, we find that the

Order passed by the NCLT (National Company Law Tribunal, Court - V, New

Delhi as well as RoC, NCT of Delhi & Haryana is not sustainable in law.

11. In view of the aforesaid, we set aside the Impugned Order dated

28.09.2021, passed by the National Company Law Tribunal Court - V, New

Delhi in Appeal No. 16/252/ND/2021. The name of the Appellant Company

is restored to the Register of Companies subject to the following compliances:

Comp. App. (AT) No. 03 of 2022 -7-

i. Appellant/Company shall pay costs of Rs. 2,00,000/- (Rupees Two

Lakh) to the Registrar of Companies, NCT Delhi & Haryana within eight

(8) weeks from the passing of this Judgment.

ii. After restoration of the Company's name in the Register maintained by

the RoC, the Company shall file all their Annual Returns and Balances

Sheets. The Company shall also pay requisite charges/fee as well as

late fee/charges as applicable.

iii. In spite of present orders, RoC will be free to take any other steps

punitive or otherwise under the Act for non-filing/late filing of statutory

returns/documents against the Company and Directors.

12. The instant Appeal is allowed to the above extent.

[Justice Anant Bijay Singh] Member (Judicial)

[Ajai Das Mehrotra] Member (Technical)

Principal Bench, New Delhi 17th November, 2023

himanshu

Comp. App. (AT) No. 03 of 2022