M/S. Bbc Developers Private Limited vs Register Of Companies Odisha

[Arising out of order dated 28.12.2020 passed by the National Company Law Tribunal (Cuttack Bench, Cuttack) in CP (Appeal) No. 252/CB/2020]

IN THE MATTER OF: M/s. BBC Developers Private Limited, Having its Registered office At:- Gayatri Vihar 28, Cantonment Road, Cuttack-753001, Odisha. ....... Struck Off. Mr. Biswajit Karmakar, S/o Ambika Charan, Karmakar residing at Mahidas Bazar, Cuttack- 753001, Odisha. ......... Appellant.

Versus

Registrar of Companies, Odisha Having its Office at Corporate Bhawan, 2nd and 3rd Floor, Plot No. 9(P), Sector-1, CDA, Cuttack, Odisha-753014 ....... Respondent.

Present: For Appellant: Mr. Ashok Panigrahi, Mr. R. Chandrachud, Ms. Geetanjali Das Krishnan, Advocates. For Respondent:- Mr. Kamal Kant Jha, Advocate for RoC. 2

JUDGMENT

(06th December, 2022)

Justice Anant Bijay Singh;

The present Appeal under Section 421 of the Companies Act, 2013, has

been preferred by the Appellant being aggrieved and dissatisfied by the order

dated 28.12.2020 passed by the National Company Law Tribunal (Cuttack

Bench, Cuttack) in CP (Appeal) No. 252/CB/2020 whereby and whereunder

appeal filed by the one of the Directors/Shareholders, Mr. Biswajit Karmakar, of

the Struck Off Company- M/s BBC Developers Private Limited for restoration of

the name of the Company in the Register maintained by the Registrar of

Companies (RoC) was dismissed by the Tribunal.

2. The facts giving rise to this Appeal are as follows:

i) The Appellant Company was incorporated under the Companies Act, 1956

on 25.04.2011 as a Private Limited Company with the office of Registrar of

Companies, Orissa. The authorized share capital of the Appellant Company is

Rs. 10,00,000/- divided into 1,00,000 equity shares of Rs. 10 each. The issued

subscribed and paid-up capital of the Company is Rs. 1,00,000/- divided into

10,000/- equity shares of Rs. 10/-. The Company was managed by two Directors

namely i) Chandan Samantaray and ii) Biswajit Karmakar. The said Directors

were each in possession of 50% shares, holding 5000 shares each.

ii) The Appellant Company for the purpose of business purchased lands

(Immovable Properties) on different dates in its name which are as follows:

Company Appeal (AT) No. 83 of 2021 3

• The Appellant Company purchased land vide Registered Sale Deed for

the land measuring Ac. 0.31 Decimal for a consideration amount of Rs.

3,41,000/- dated 27.12.2011.

• The Appellant Company purchased land vide Registered Sale Deed dated

13.09.2013 measuring Ac. 0.16 Decimal for a consideration amount of

Rs. 3,00,000/-.

• The Appellant Company vide Registered Sale Deed dated 04.05.2013

purchased land measuring Ac.0.11 Decimal for a consideration amount

of Rs. 4,00,000/-.

• The Appellant Company vide Registered Sale Deed dated 13.11.2013

purchased land measuring Ac0.21.5 Decimal for a consideration amount

of Rs. 2,50,000/-.

• The Appellant Company vide Registered Sale Deed dated 24.01.2014

purchased land measuring Ac.0.11 Decimal for a consideration amount

of Rs. 1,10,000/-.

• The Appellant Company has duly mutated the name of the Company

against the purchased lands.

iii) The Appellant Company has been operating since the date of its

incorporation i.e. 25.04.2011. The Appellant Company could not file Financial

Statements and Annual Returns from Financial Year 2012-13 onwards due to

management issues and inadvertence and business complexities. Moreover, the

Company could not obtain professional advice as per the new Companies Act,

2013 because of inadvertence. All assets of the Company remained intact and it Company Appeal (AT) No. 83 of 2021 4

never became defunct. The accounts of the Company have been audited every

year.

iv) Further case is that on 07.07.2017, the Respondent published the Notice

of striking off and Dissolution under Section 248(5) of the Act wherein the name

of the Appellant Company was mentioned in the list of the companies whose

name was to be struck off from the Register of the Companies. The name of the

Appellant Company was mentioned in the list of the companies to be struck off

from the Register of the Companies against Serial No. 1304. Aggrieved by the

actions of the Respondent, the Appellant Company filed Appeal under Section

252 of the Act before the NCLT seeking restoration of its name on the Register

maintained by the Respondent and after the parties the NCLT dismissed the said

Appeal which led to filing of this Appeal.

3. The Ld. Counsel for the Appellant during the course of argument and in

his memo of Appeal submitted that while passing the impugned order the

Tribunal failed to consider that all the assets of the company remained intact

and in such circumstances it cannot be concluded that the Appellant Company

is not carrying on its business within the meaning of Section 248 of the Act. The

Tribunal has also not considered the sale deeds because it is vernacular

language, the same has been filed before this Tribunal and also Audit Reports

along with Balance Sheet and Financial Statements of the Appellant Company

from 2012-2013 to 2019-2020 which shows that the Company is on going

concern and doing business.

Company Appeal (AT) No. 83 of 2021 5

4. It is further submitted that while passing the impugned order the Tribunal

failed to consider the fact that the Appellant has not received any notices from

the Respondent prior to the Gazette Notification dated 07.07.2017 and further

Section 248 of the Act mandates notices are required to be issued before striking

off the name of the Company from the register of the Respondent which has not

been followed in the present case. The Appellant Company neither received any

show Cause Notice nor it afforded any opportunity of being heard before the

action of striking off its name was taken by the Respondent. The Appellant only

after receiving the Gazette notification came to know about its name being struck

off from the Register of Respondent. Based on these submissions, the impugned

order is set aside and the Appeal may be allowed.

5. On the other hand, the Ld. Counsel for the Respondent during the course

of argument and in his reply submitted that the Appellant Company was the

continuous non-filing of the statutory returns i.e. financial statements and

Annual Returns since the financial year ending 31.03.2012 onwards. Thereafter,

the Respondent issued Notice STK-1 i.e. a show cause notice under Section

248(1)(c) of the Companies Act, 2013 to the Appellant company enquiring

whether the said company was carrying on any business or was in operation,

but no reply to the said show cause notice was received by the Respondent's

office. Subsequently, the Respondent published in the Official Gazette and

Newspaper for the information of the general public regarding striking off the

name of the company in Form No. STK-5/5A. In view of the submissions, the

Company Appeal (AT) No. 83 of 2021 6

Tribunal rightly observed that the subject company had not been a going concern

and was having any business operations.

6. After hearing the parties, going through the pleadings made on behalf of

the parties and in view of the fact that the Appellant Company have purchased

the lands between 2011-2013 and Audit Reports along with Balance Sheet and

Financial Statements of the Appellant Company from 2012-2013 to 2019-2020

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 NCLT (Cuttack Bench, Cuttack) as well as RoC, Odisha is

not sustainable in law.

7. In view of the aforenoted, we set aside the impugned order dated

28.12.2020 passed by the National Company Law Tribunal (Cuttack Bench,

Cuttack) in CP (Appeal) No. 252/CB/2020. The name of the Appellant Company

be restored to the Register of Companies subject to the following compliances.

i) Appellant shall pay costs of Rs. 1,00,000/- (Rupees one Lakh) to the

Registrar of Companies, Odisha within 30 days.

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) 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

Company Appeal (AT) No. 83 of 2021 7

filing of statutory returns/documents against the Company and

Directors.

The instant Appeal is allowed to the above extent.

8. Registry to upload the Judgment on the website of this Appellate Tribunal

and send the copy of this Judgment to the National Company Law Tribunal

(Cuttack Bench, Cuttack), forthwith.

[Justice Anant Bijay Singh] Member (Judicial)

[Ms. Shreesha Merla] Member (Technical)

New Delhi 06th December, 2022 R. Nath.

Company Appeal (AT) No. 83 of 2021