M/S Leading Age Properties Private ... vs Registrar Of Companies Mumbai

[Arising out of order dated 29.11.2019 passed by the National Company Law Tribunal (Mumbai Bench) in CP No. 1958/252(1)/MB/C-IV/2019]

IN THE MATTER OF:

Bharat Goyal, Director of M/s Leading Age Properties Private Limited, 2, Sunflower, 27-B Carter Road, Bandra (W), Mumbai-400050. ....... Appellant.

Versus

Registrar of Companies, Mumbai, Evrest Building, 100, Mumbai Drive-400002 Email id roc.mumbai@mca.gov.in ....... Respondent. Present: For Appellant: Ms. Aastha Shrestha, Mr. Kumar Anurag Singh, Mr. Shwetank Singh, Advocates. For Respondent:- Mr. Kamal Kant Jha, Sr. Panel Counsel (GOI) for RoC, Mumbai.

JUDGMENT

(01st June, 2023)

Justice Anant Bijay Singh;

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

been filed by the Appellant being aggrieved and dissatisfied by the order dated

29.11.2019 passed by the National Company Law Tribunal (Mumbai Bench) in 2

CP No. 1958/252(1)/MB/C-IV/2019 whereby and whereunder appeal filed by

the Appellant for restoration of the name of the Company in the Register

maintained by the Registrar of Companies (RoC), Mumbai 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 21st October, 2005 vide CIN:U70100MH2005PTC156948, as a Private

Limited Company and was registered with the ROC' Mumbai. Authorized share

capital of the Company ofRs.1,00,000/- is divided into 10000 equity shares of

Rs'10/- each. These shares were issued and were subscribed, as per the

provisions of the Companies Act,1965. Paid Up Capital of the Company is

Rs.1,00,000/-.

ii) The main object of the company are to carry on in India and abroad the

business of acquiring, buying, developing, maintaining, selling, hiring, leasing'

managing or otherwise dealing in lands, dwelling houses, shops, offices,

industrial estates, farms, farm houses, holiday resorts, lease of lands, flats,

commercial establishments and other immovable properties and to purchase,

take on lease or otherwise acquire and hold any lands or buildings of any tenure

or description wherever situated or rights or interests therein or construct, re-

construct pull-down, renovate, alter, improve decorate and furnish and maintain

flats, marionettes, dwelling houses, shops, offices, blocks, buildings, hotels,

motels, farm houses, holiday resorts, club house, industrial estates works and

conveniences and /or sell the same on ownership basis, instalments basis hire-

purchase basis or lease basis, transfer such building to co-operative society, or

Company Appeal (AT) No. 145 of 2021 3

association of persons or individuals as the case may be, to lay out roads,

pleasure gardens, recreation, grounds, auditoriums, theatres, health clubs,

service canters and sports pavilion, to plant, drain or otherwise improve land

building or any part thereof.

iii) The business of the Appellant company was going on smoothly and nolegal

omission or commission of was committed by the Appellant till the year in

dispute. The main Director of the Appellant Company Shri Govind Lal Ganesh

Lal Govil expired on 08.12.2017. As a result, the activities of the Appellant

Company came to stand still for a short period. Thereafter, Secretary of the

Appellant Company was hospitalized on 03.03.2018, because of certain health

issue and she was discharged from the hospital on 10.03.2018, due to which

filing of Annual Returns for the Financial Years 2015-16 and 2016-17 was due.

iv) Further, case is that the company was not defunct and was carrying of its

business regularly. The annual general meeting was conducted on 30.09.2016.

The Director given report to the members for the year ended on 31.03.2016 dated

02.09.2016. The Independent Auditor's Report was given to the members for the

period ended on 31.03.2016 dated 22.08.2016. The balance sheet for the period

ended on 31.03.2016 enclosed to the annual general meeting held on 30.09.2016

and also enclosed notes on account for the year ended March 31, 2016. The

statement of profit and loss account for the period ended 31.03.2016 and

31.03.2017 are also available. The assesses paid income Tax of Rs. 1,28,438/-

vide income tax report receipt dated 30.03.2018.

v) The Registrar of Companies issued its letter dated 03.07.2018 to the

Appellant Company informing it that it was not carrying on any business

Company Appeal (AT) No. 145 of 2021 4

operations for the last two preceding financial years and that it had not made

any application within stipulated period for obtaining the status of a dormant

company, as per the provisions of Section 455 of the Companies Act. On

19.07.2018, the ROC, Mumbai further issued a notice to the Appellant for

striking off its name from the Register of the Companies. Accordingly, vide

publication, dated 11.09.2018, the ROC, Mumbai published the names of the

Corporate Entities, whose names were struck off from the list of Active

Companies. The name of the appellant company appeared at Sl. No. 5217 of the

list issued by the ROC, Mumbai. Thereafter, the Appellant filed appeal against

the order of Registrar of Companies for restoration of name of the Company

under Section 252 of the Companies Act, 2013 and after hearing the parties, the

Tribunal passed the order impugned dated 29.11.2019 which led to filing of this

Appeal.

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

grounds taken in her memo of Appeal submitted that the Company has failed to

file its Financial Statements and Annual Returns for the Financial Years 2015-

16 and 2016-17 i.e. two years. Therefore, the Registrar of Companies, Mumbai,

formed an opinion that the basis for striking off the name of the Company was

the continuous non-filing of the statutory returns and the Company is not

carrying on any business or operation for a period for two immediately preceding

financial years and has not applied to declare itself as Dormant Company under

Section 455 of the Companies Act, 2013. On such presumption that the

Company is inactive and non-operational, the ROC struck off the name of the

Company Appeal (AT) No. 145 of 2021 5

Company from the Register of Companies under Section 248(1) of the Companies

Act, 2013.

4. It is further submitted that the reason for non-filing of Annual Returns for

the Financial Years 2015-16 and 2016-17 was due to inadvertence. Further,

submitted that the company is active and carrying on day-to-day business from

its incorporation. She further submitted that she has enclosed the audited

accounts for the Financial Years 2016-17 and 2017-18.

5. It is further submitted that the NCLT erred in rejecting the appeal on the

misleading facts submitted by the ROC, Mumbai. The NCLT directed the ROC to

file report on the appeal but the ROC did not comment on reasonableness of

non-filing of statutory returns. The Appellant Company had filed the returns,

but the ROC, Mumbai suppressed this vital fact before the NCLT. Based on above

submissions, the impugned order is fit to be set aside and the Appeal be allowed.

6. On the other hand, the Ld. Counsel for the Respondent No. 1/Registrar of

Companies in his Reply it is stated that the Company-Leading Age Properties

Private Limited was incorporated with the office of the Registrar of Companies,

Mumbai on 21.10.2005, but due to failure in filing of its statutory returns, the

name of the company has been considered for striking off by the Registrar of

Companies, Mumbai in a suo moto action under the provisions of Section 248 of

the Companies Act, 2013 and also in pursuance of the circulars issued by the

ministry of Corporate Affairs, Govt. Of India, New Delhi from time to time. The

basis for striking off the name of the company was the continuous non-filing of

the statutory returns (which are required to be filed under the Act.) and company

is not carrying on any business or operation for a period of two immediately

Company Appeal (AT) No. 145 of 2021 6

preceding financial years and has not made any application within such period

for obtaining the status of a dormant company under Section 455, prior to it

struck off. The aforesaid situation has arisen due to inaction on the part of the

Appellant Company and its Directors/officers. The appropriate action taken by

Respondent to strike off the company, which is duly prescribed under Section

248 of the Companies Act, 2013.

7. After hearing the parties and going through the pleadings made on behalf

of the parties, we observe that the Appellant Company has failed to file its

Financial Statements and Annual Returns for the Financial Years 2015-16 and

2016-17 due to change of circumstances. Further, we also observe that the

audited accounts for the Financial Years 2016-17 and 2017-18 shows that the

company is in active and carrying on day-to-day business. Keeping in view of the

above facts, 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 (Mumbai Bench) as well as

Registrar of Companies, Mumbai is not sustainable in law.

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

29.11.2019 passed by the National Company Law Tribunal (Mumbai Bench) in

CP No. 1958/252(1)/MB/C-IV/2019. The name of the Company be restored to

the Register of Companies subject to the following compliances.

i) Appellant Company shall pay costs of Rs. 1,00,000/- (Rupees

One Lakh) to the Registrar of Companies, Mumbai within eight

(8) weeks from the passing of this Judgment.

Company Appeal (AT) No. 145 of 2021 7

ii) After restoration of the Company's name in the Register

maintained by the Registrar of Companies, the Company shall

file all their Annual Returns and Balance Sheets. The Company

shall also pay requisite charges/fee as well as late fee/charges

as applicable.

iii) Inspite of present orders, Registrar of Companies 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 instant Appeal is allowed to the above extent. I.A, if any, stands

disposed of.

9. 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

(Mumbai Bench), forthwith.

[Justice Anant Bijay Singh] Member (Judicial)

[Naresh Salecha] Member (Technical)

New Delhi 01st June, 2023 Ram Nath.

Company Appeal (AT) No. 145 of 2021