R Narayanasamy vs The Registrar Of Companies Tamil Nadu

[Arising out of Order dated 5th May, 2020 passed by National Company Law Tribunal, Division Bench - I, Chennai in CA/6/2020]

IN THE MATTER OF: Before NCLT Before NCLAT

R Narayanasamy Applicant Appellant 55 G, Ramasamy Naidu Nagar, Vilankuruchi Post, Coimbatore 641035

Vs.

The Registrar of Respondent Respondent Companies, Tamil Nadu AGT Business Park, Avinashi Road, Civil Aerodrome Post Coimbatore Tamil Nadu 641014

For Appellant: Ms. Hema Sampath, Sr. Advocate with Mr. B. Karunakaran, Advocate.

For Respondent: Mr. Chetan Sharma, Sr. Advocate (Addl. Solicitor General of India), with Mr. P.S. Singh and Mr. Sahaj Garg, Advocates for RoC. Mr. C.S. Govindarajan, (Joint Director, RoC, Coimbatore, MCA)

Opinion / J U D G E M E N T (19th January, 2021) A.I.S. Cheema, J. :

1. This Appeal has been filed against the Impugned Order dated 5 th

May, 2020 passed by the National Company Law Tribunal, Division 2

Bench - I Chennai (NCLT - in short) dismissing the Appeal under Section

252(3) of the Companies Act, 2013 (Companies Act - in short) which was

filed for restoration of the name of the Company "Shri Laxmi Spinners

Pvt. Ltd." which Company had been struck off by the Respondent - ROC

after following necessary procedure under Section 248 of the Companies

Act.

2. The Appeal had come up before Division Bench of this Tribunal and

the Hon'ble Member (Judicial) and Hon'ble Member (Technical) delivered

divergent Judgements on 26th November, 2020. The Hon'ble Members

recorded a note on same date asking Registrar to place the record before

the Hon'ble Acting Chairperson together with copies of the Judgements

for constituting appropriate Bench/nominating Hon'ble 3rd Member for

rendering his opinion/decision in the Appeal. When the Registrar put up

the note before the Hon'ble Acting Chairperson, on the administrative

side, the Hon'ble Acting Chairperson on 27th November, 2020 directed

that in view of split verdict, let the Appeal be placed before me for

opinion. This is how the Appeal came to be placed before me on judicial

side on 18th December, 2020. Respondent had not appeared and I heard

learned Senior Counsel for Appellant and reserved the matter for

Judgement. Before the proceedings on 18.12.2020 could be signed, in the

course of the day, the ROC reached this Tribunal and wanted to file

written submissions. Earlier in the Appeal, ROC had not appeared before

the Hon'ble Judges when the Judgements dated 26th November, 2020

Company Appeal (AT) No.171 of 2020 3

were passed. In the interest of justice on 18th December, 2020, I recorded

the proceedings giving opportunity to the Respondent to file written

submissions and fixed the matter for further hearing on 5th January,

2021.

3. I again heard the learned Counsel for Appellant on 5th January,

2021 and the learned Additional Solicitor General of India for ROC and

reserved the matter for opinion/Judgement.

4. I have gone through the Judgements of the Hon'ble Members dated

26th November, 2020. Hon'ble Member (Technical) recorded Judgement

and considering all the relevant aspects found that the decision of the

learned NCLT in dismissing the Appeal which was before NCLT was

correct and that there was no reason to interfere. He, considering the

material directed the Appeal to be dismissed.

Hon'ble Member (Judicial) had gone through the Judgement of the

Hon'ble Member (Technical) and recorded that he was differing with the

views expressed. He proceeded to record his findings separately. The

Hon'ble Member (Judicial) has also recorded detailed Judgement and

after examining the material, come to a conclusion that the Appeal

deserved to be allowed and the name of the Company deserved to be

restored complying with formalities and costs as directed.

Both Hon'ble Members on analysing the law as is existing, on basis

of what is "just" under Section 252(3) of the Companies Act, while

Company Appeal (AT) No.171 of 2020 4

applying the same to facts, came to divergent conclusions. See para - 38

of the Judgement of Hon'ble Member (Judicial) vis-à-vis Para - 16 of the

Judgement of Hon'ble Member (Technical). What is "Just" under Section

252(3) of the Companies Act, 2013 would be finding of fact.

5. The Hon'ble Members of the Bench have not recorded any point or

points, legal or factual for referring the same to the third Member. As

such, there is no clarity as to what happens, in case an Order different

from both the Members was to be passed. For example, in matters like

the present one, there can be an Order to restore the name of the

Company limited for meeting particular contingencies and then restore

the Orders striking off the name.

6. I have gone through the provisions of the Companies Act, 2013 and

the National Company Law Appellate Tribunal Rules, 2016 (NCLAT

Rules, 2016) to see if there is a procedure prescribed in this context.

7. Section 419 of the Companies Act, 2013 deals with Benches as

regards NCLT and Sub-Section (5) may be referred. Section 419(5) reads

as under:-

"(5) If the Members of a Bench differ in opinion on any point or points, it shall be decided according to the majority, if there is a majority, but if the Members are equally divided, they shall state the point or points on which they differ, and the case shall be referred by the President for hearing on such point or points by one or more of the other Members of the Tribunal and such points or points shall be decided according to the opinion of the majority of

Company Appeal (AT) No.171 of 2020 5

Members who have heard the case, including those who first heard it."

Thus this Sub-Section provides (as regards NCLT) that when the

Members differ, they shall state the point or points on which they differ

and when the matter is referred to other Member/s, the point or points

shall be decided according to the opinion of the majority. Similar

provision does not appear to be there with regard to the Appellate

Tribunal.

8. Sub-Section (1) of Section 424 of the Companies Act reads as

under:-

"424. Procedure before Tribunal and Appellate Tribunal.--(1) The Tribunal and the Appellate Tribunal shall not, while disposing of any proceeding before it or, as the case may be, an appeal before it, be bound by the procedure laid down in the Code of Civil Procedure, 1908 (5 of 1908), but shall be guided by the principles of natural justice, and, subject to the other provisions of this Act [or of the Insolvency and Bankruptcy Code, 2016] and of any rules made thereunder, the Tribunal and the Appellate Tribunal shall have power to regular their own procedure."

9. This Appellate Tribunal is not "bound" by the procedure laid down

in CPC which is the general law in civil matters. Though not bound as

such, I can still follow the procedure with or without modifications.

Under Section 424, what is to be followed is the principles of natural

justice and the provisions of the Act. This Tribunal can regulate its own

procedure. Keeping this in view, when the NCLAT Rules are seen, even

Company Appeal (AT) No.171 of 2020 6

they do not disclose any procedure with regard to the reference and how

the Appeal is to be disposed after the third Member records his

opinion/Judgement. Rule 104 of the NCLAT Rules reads as under:-

"104. Removal of difficulties and issue of directions.--Notwithstanding anything contained in the rules, wherever the rules are silent or no provision is made, the Chairperson may issue appropriate directions to remove difficulties and issue such orders or circulars to govern the situation or contingency that may arise in the working of the Appellate Tribunal."

May be, directions required to be issued under Rule 104 could be of

help. I do not have benefit of any such direction issued by the Hon'ble

Chairperson which would remove present difficulty.

10. I thus fall back to Section 424 of the Companies Act. I am not

bound by CPC but for following principles of natural justice, I can adopt

procedure which otherwise has the force of law. The Rules of procedures

laid down are apparently based on principles of natural justice so that

the parties before the Courts/Tribunal get fair justice. On this basis, I

find it appropriate to refer to Section 98 of CPC which reads as under:-

"98. Decision where appeal heard by two or more Judges.--(1) Where an appeal is heard by a Bench of two or more Judges, the appeal shall be decided in accordance with the opinion of such Judges or of the majority (if any) of such Judges.

(2) Where there is no such majority which concurs in a judgment varying or reversing the decree appealed from, such decree shall be confirmed:

Provided that where the Bench hearing the appeal is composed of two or other even number of

Company Appeal (AT) No.171 of 2020 7

Judges belonging to a Court consisting of more Judges than those constituting the Bench and the Judges composing the Bench differ in opinion on a point of law, they may state the point of law upon which they differ and the appeal shall then be heard upon that point only by one or more of the other Judges, the such point shall be decided according to the opinion of the majority (if any) of the Judges who have heard the appeal including those who first heard it.

(3) Nothing in this section shall be deemed to alter or otherwise affect any provision of the letters patent of any High Court."

11. Applicability of Section 98 of CPC in the context of Section 23 of the

Travancore Cochin High Court Act, 1125 had come up for consideration

before Constitution Bench of the Hon'ble The Supreme Court of India in

Civil Appeal No.201/2005 "Pankajakshi and Ors. vs. Chandrika and

Ors." - MANU/SC/0233/2016 : (2016) 6 SCC 157). The Judgement is

dated 25th February, 2016. While deciding the reference, the Hon'ble

Constitution Bench recorded in para - 51 as under:-

"51. For the aforesaid reasons we conclude that Hemalathas case was wrongly decided and answer Question 1 referred to us by stating that Section 23 of the Travancore-Cochin High Court Act remains unaffected by the repealing provision of Section 9 of the Kerala High Court Act, and that, being in the nature of special provision vis-a-vis Section 98(2) of the Code of Civil Procedure, would apply to the Kerala High Court."

Hon'ble Shri Justice Kurian Joseph wholly agreed with the

excellent exposition of law by Hon'ble Shri Justice R.F. Nariman and

recorded that His Lordship has nothing to add on the reference part.

Company Appeal (AT) No.171 of 2020 8

However, for appropriate guidance at the quarters concerned, His

Lordship made few observations contextually relevant. The Hon'ble Judge

succinctly made Section 98 of CPC clear which had come up for

consideration in the context of Section 23 of the Travancore Cochin High

Court Act, 1125. The observations recorded are as under:-

"55. Under Section 98 of The Civil Procedure Code, 1908 (for short, the CPC), when the Judges differ in opinion on a point of law, the matter is required to be placed for opinion of a third Judge or more of other Judges as the Chief Justice of the High Court deems fit and the point of law on which a difference has arisen is decided by the majority and the appeal is decided accordingly. It is to be seen that under the proviso to Section 98(2) of the CPC, hearing by a third Judge or more Judges is only on the point of law on which the Division Bench could not concur. There is no hearing of the appeal by the third Judge or more Judges on any other aspect. Under Section 98(2) of the CPC, in case an appeal is heard by a Division Bench of two or more Judges, and if there is no majority and if the proviso is not attracted, the opinion of that Judge of the equally divided strength in the Bench which concurs in a judgment following or reserving the decree appealed from, such decree shall stand confirmed.

56. Kerala High Court Act, 1958 has provided for the powers of a Bench of two Judges under Section 4. It is clarified thereunder that if the Judges in the Division Bench are of opinion that the decision involves a question of law, the Division Bench may order that the matter or question of law be referred to a Full Bench. Needless to say, it should be a question of law on which there is no binding precedent.

57. Under Section 23 of the Travancore-Cochin High Court Act, 1125, if the Division Bench disagrees either on law or facts, the Chief Justice is required to refer the matter or matters of disagreement for the opinion of another Judge and the case will be decided on the opinion of the majority hearing the case."

Company Appeal (AT) No.171 of 2020 9

12. Thus, in the absence of specific provision, if by me Section 98(2) of

CPC is to be adopted relying on principles of natural justice, then, when

there is no majority in a Judgement varying or reversing the decree

against which the Appeal has been filed, such decree is required to be

confirmed if point of law is not the cause of difference. I have gone

through the Judgements of the Hon'ble Members of this Tribunal where

they have recorded divergent Judgements. The difference between the

Hon'ble Members does not appear to be on point of law. No point of law

or difference on point of law is recorded. The Hon'ble Members have

considered the facts involved and different views are on the basis

whether it would be "just" to restore the name of the Company. In this

context, Sub-Section (3) of Section 252 of the Companies Act is relevant

which reads as under:-

"(3) If a Company, or any member or creditor or workman thereof feels aggrieved by the company having its name struck off from the register of companies, the Tribunal on an application made by the company, member, creditor or workman before the expiry of twenty years from the publication in the Official Gazette of the notice under sub-section (5) of section 248 may, if satisfied that the company was, at the time of its name being struck off, carrying on business or in operation or otherwise it is just that the name of the company be restored to the register of companies, order the name of the company to be restored to the register of companies, and the Tribunal may, by the order, give such other directions and make such provisions as deemed just for placing the company and all other persons in the same position as nearly as may be as if the name of the company had not been struck off from the register of companies."

Company Appeal (AT) No.171 of 2020 10 Section 252 provides for relief to aggrieved parties when Registrar

notifies a Company as dissolved under Section 248. When aggrieved

entity is as provided in Sub-Section (3) reproduced above, it is clear that

the name of the Company is required to be restored if the NCLT - (1) is

satisfied that Company was at the time of its name being struck off

carrying on business or in operation, (2) or, otherwise it is "just" that the

name of the Company be restored to the Register of Companies. In the

present matter, the admitted fact is (I will refer to the rival cases later)

that when the name of the Company was struck off, it was not functional

and was not carrying on business or operations for more than two years

immediately preceding the financial year and thus attracted Section

248(1)(c). When question of law has neither been framed or referred, and

it appears from the Judgements that the two Hon'ble Members have

divergent views, on the basis of facts my opinion is that the Appeal

should be dismissed by not interfering in the dismissal Order of NCLT, on

principles of Natural Justice, culled from Section 95 of CPC.

13. Having recorded finding and opinion as above, I proceed to consider

the Appeal on its merits also, in case at any point of time, it is found that

I should have recorded my opinion on the merits of the Appeal.

Opinion on merits

The Appellant filed Appeal CA 6/2020 before the learned NCLT,

Copy of the Appeal is at Annexure A-11 (Page 182). The Appellant

claimed to be Managing Director of the Company - Shri Laxmi Spinners

Company Appeal (AT) No.171 of 2020 11

Pvt. Ltd. The Appellant claimed that the Company was in the business of

spinning, weaving and in the business of buying and selling raw or

finished cotton, wool, etc. products. Appellant claimed before NCLT that

the Company has fixed assets as mentioned in para - 4.9. It was claimed

that the Company did not file Balance Sheets and Annual Returns since

incorporation (see para - 4.10 of Annexure A-11) (This is not correct as

according to ROC, Returns were not filed since 2015). The Appellant

claimed that this happened in the absence of expert professional

guidance. Appellant claimed that a Consultant was there but he did not

have knowledge of Company law. Appellant claimed that "the Company

has no activity as of now and in any event, we should have filed the NIL

Report at least". The Appellant claimed that ROC had issued Notice

under Section 248(1) dated 11th May, 2018 proposing to strike off the

name of the Company. Copy of the Notice is at Annexure A-8. Appellant

claimed that the Appellant had sent Reply on 24 th July, 2018. It was

claimed that ROC received the Reply but later when the Appellant tried to

submit the Annual Returns, they came to know that the name of the

Company was struck off as per Notice published dated 6th July, 2018.

(This is not correct. Annexure A-10 is Notice STK-7 dated 31.08.2018

recording that "Shri Laxmi Spinners Pvt. Ltd." at Sl. No.31 of the List was

struck off from date of "29.08.2018"). Appellant claimed that the striking

off was prejudicial to the interest of the Company and that Returns were

not filed out of ignorance and inadvertence. The Appellant thus sought

restoration claiming that necessary systematic changes will be made in

Company Appeal (AT) No.171 of 2020 12

Board of Directors so that the lapse does not recur. Appellant claimed

that there were Income Tax Returns for the years 2014 - 2015 to 2017 -

2018 showing gross total income as NIL and tax paid as NIL. Appellant

claimed before NCLT that it was just and equitable to restore the name of

the Company in view of Section 252(3) of the Companies Act. In para -

4.21, it was also claimed that there were some legal cases and dispute

with the Electricity Board and also with Regional Provident

Commissioner, as mentioned.

On such basis, restoration was sought.

14. The ROC filed Report (Annexure A-12) before NCLT pointing out

that the Financial and Annual Returns were not filed since 2015 and that

Notice under Section 248(1) was issued on 11th May, 2018 and that no

Reply was sent by the Company. The Report stated that STK - 5 was

published in official Gazette on 6th July, 2018 and STK - 7 was published

on 15th September, 2018. ROC claimed that after due Notice and

completing due procedure, the name of the Company was finally struck

off under Section 248(5) of the Companies Act on 29 th August, 2018 and

the name was published in Gazette of India dated 15 th September, 2018.

It was claimed that there was default in Financial Returns and no Reply

was given to the Notice under Section 248(1). The Notice had been sent to

the Company as well as its Directors. Para - 8 stated that "however" the

ROC had no objection to restore the name of the Company subject to

directions required as per NCLT Amendment Rules, 2017.

Company Appeal (AT) No.171 of 2020 13

15. Learned NCLT in the Impugned Order dismissing the Appeal filed

by the Appellant noted these aspects and the arguments for the

Appellant that it was "just" and equitable to restore the name of the

Company under Section 252(3). The learned NCLT recorded the

submissions that the Company as on date was not carrying on business

and was not having any production activity and there was no sales

activity. Impugned Order recorded that the Appellant has only expressed

that they would start business again as conditions were improving. The

NCLT considered the documents filed and observed that the Income Tax

Returns were filed but not the Returns required to be filed with ROC. The

conclusion drawn in para - 11 of the Impugned Judgement is as under:-

"11. Thus, after conscientious perusal of the documents filed by the Applicant Company, this Tribunal is satisfied that the Applicant Company is not carrying on its business during the time when the Company was struck off from the Register maintained by the Respondent and also no cogent reasons or any documents are produced before this Tribunal in order to substantiate that the Company was carrying on its business or it is just to revive / restore the name of the Company to the Register as maintained by the Respondent."

Thus, the Appeal came to be dismissed by the learned NCLT.

16. In the present Appeal before this Tribunal, the Appellant for the

first time has tried to claim in para - 7.12 that the Notice dated 11th May,

2018 (Annexure A-8) was sent on 22.06.2018 antedating the same as

11th May, 2018. No foundation was laid and no material is shown to

Company Appeal (AT) No.171 of 2020 14

make such claim for the first time in Appeal before this Appellate

Tribunal. Such claim deserves to be rejected.

17. To the Notice dated 11th May, 2018 (Annexure A-8), the Appellant

claims to have sent Reply (Annexure A-9) on 24th July, 2018 (Page - 178).

The ROC had in Notice under Section 248(1) alleged that the Company

was not carrying on any business or operation for period of two

immediately preceding financial years and had not made application

seeking status of dormant company under Section 455. In the Reply

dated 24th July, 2018, the Appellant did not deny this. Rather the

Appellant accepted and claimed that due to unfavourable market

conditions and technical difficulties in the recent years, they were facing

financial loses and had no operations and all activities of the Company

were put to halt and the Company did not have significant business

activities in past few years. The Appellant claimed in the Reply that he

was in the process of revival of the company as market conditions are

favourable to the industry. He claimed that Statutory Returns would be

filed for the past four years. He prayed that the name may not be struck

off.

18. Thus, when Company was struck off, admittedly for past few years,

it was not carrying on any business or operation. Section 248(1)(c) stood

attracted. If this Reply is considered, the Appellant did not claim before

ROC that there was labour problem or erratic electric supply and thus

the production was required to be stopped as is being now claimed. The

Company Appeal (AT) No.171 of 2020 15

arguments made for Appellant claim that due to litigation also the

Returns were not filed. These reasons given to show that there was "just"

reason under Section 252(3) are without foundation.

19. I consider the grounds taken that there were litigations pending

and thus the name of the Company was required to be restored. Hon'ble

Member (Judicial) in his Judgement referred to particulars on this count

as mentioned in Appeal before NCLT. Copies of some Judgements being

relied on are filed with Diary No.24319. Counsel for Appellant referred to

Judgement in the matter of "Indian Expositions Ltd. vs. ROC"

Company Petition 185 of 2008 dated 21st April, 2010 passed by the

Hon'ble High Court of Delhi in Company jurisdiction to submit that

Hon'ble High Court held that when litigation was pending prior to the

striking off the name of the Company, the name should be restored. The

Judgement shows that, in that matter the Petitioner who moved the High

Court as the Petitioner had an award in its favour but could not execute

the same as the name of the Company was struck off. Reliance is also

placed on the Judgement in the matter of "Umed Bhai Jhaverbhai vs.

Moreshwar Keshav" reported in AIR 1954 MB 146. In that matter, the

Applicant had money to recover from the concerned mill and Suit was

pending to recover the amount when ROC struck off the Company. On

the Petition of such Applicant and facts, the name was directed to be

restored. Clearly, those would be persons relying on Section 252(1) of the

Companies Act.

Company Appeal (AT) No.171 of 2020 16

The Appellant has referred to a few other Judgements of this

Tribunal also in this regard. As such, I refer to the cases which are said

to be basis for claim that the name requires to be restored. The written

submissions filed by the Counsel for Appellant vide Diary No.24318 in

this regard mention:-

"

 Apart from that, the appellant is facing labour cases, Provident fund cases and electricity board cases.

a. Labour case: Regarding the termination of two workers in 2004. WA (MD) 1161 and 1162 of 2018 were filed before Madurai Bench of Madras High Court and the appellant has paid Rs.1,07,004 to one person and Rs.1,48,800/- to another person and the writ appeals were closed on 19/8/2019 recording the same.

b. EPF : In pursuance of the order of the Madurai Bench of Madras High Court passed in WP (MD) 9237 of 2010, the appellant has settled EPF claim of Rs.10,59,616, in 2019 as per court direction. EPF has filed Writ Appeal (MD) SR No.31818/2020 on 07.12.2020. The appellant will contest it.

c. Electricity Board (TNEB): The appellant has a deposit of about Rs. 15 lakhs. But TNEB has adjusted the amount against the minimum monthly bills. WP (MD) No.7455 of 2020 is pending at Madurai Bench of Madras High Court in this regard.

d. In a money claim the assets of the company are sought to be attached. The appellant has filed RFA 1214 of 2014 before the Karnataka High Court and applied for stay and deposited Rs.10 lakhs on 02.03.2020 as directed by the court.

Company Appeal (AT) No.171 of 2020 17

e. On 29.05.2020 the appellant has paid Rs.4,30,493/- to the TANGEDCO as per the order dated 23.03.20 of CONSUMER GRIEVANCE REDRESSAL FORUM, VIRUDHUNAGAR in petition no.14/2019-20, towards the claim of peak hour penalty relating to period of 2010."

20. It can be seen from the above that even after striking off of the

name of the Company w.e.f. 29th August, 2018, the Appellant claims to

have made payments. No documents to show prospects with regard to

the alleged litigation have been filed.

21. The Appeal claims (para - 7.11) that the Appellant tried to file

Balance Sheets and Annual Returns and copies of the same from the

year 2014 - 2015 to 2018 - 2019 are filed. I have seen Annexure A-7

colly. The Return of 2018 - 2019 is not there. The copy of Annual Report

for 2017 - 2018 is at Page - 144 and the independent Auditors Report

starts at Page - 160 and at Page - 163, it is recorded by the Chartered

Accountants that "The Company does not have any pending litigations

which would impact its financial position". This independent Auditors

Report dated 5th September, 2018 is part of the Annual Report 2017 -

2018. The other earlier Returns also appear to be having similar

endorsements. Thus, what is put on record is that the Company was not

having any pending litigations which would impact its financial position.

This being the record before me, I do not find it proper to take the bare

words as recorded in the arguments filed before this Tribunal to claim

Company Appeal (AT) No.171 of 2020 18

that there were litigations pending and that the litigations were of such a

nature that it would be just to restore the name of the Company.

22. As regards the assets, the Appellant has claimed that the Company

has a property on its name and also filed a Valuation Report (Annexure

A-6 colly) claiming that the market value of the property which is known

as Laxmi Mills Factory Building and Guest House Building is worth more

than Rs.8 Crores. Again if the Annual Report of 2017 - 2018 is to be

referred at Page - 167, there is Balance Sheet as on 31.03.2018. In the

Column of Assets, there is entry of "Non-current assets". There is

reference to "(a) Fixed assets". Against "Tangible Assets" there is mention

of the amount of Rs.12,86,637/- as on 31.03.2018. The column mentions

Note No.8 for particulars. When I have tried to see the particulars so as

to read the Note No.8, I have noticed (Pages - 170 and 171) that various

Notes to Balance Sheets have been recorded for particulars. Note No.8,

however, is missing in these Notes. Similar is the condition with the

Balance Sheet of 2014 - 2015 (Page - 51 read with Page - 71) where there

is reference with regard to tangible assets to be read with Note No.9 and

there also at the concerned Page - 77 the Note No.9 is missing. Thus, the

Appellant is claiming restoration and for the purpose of just ground

argues that the Company has property on its name but does not show

document of title. Annexure A-6 - Valuation Report does not record title

as such. Para - 7.8 of Appeal referred to the property to claim that

infrastructure is available. Thus, on facts, even in this regard, I do not

Company Appeal (AT) No.171 of 2020 19

find that the Appellant has made out a just reason to seek restoration of

the name of the Company. It is not sufficient merely to make averments

but it is necessary to support the averments with necessary documents,

may be claim with regard to litigation or may be claim with regard to

property so as to consider if it is "just" to restore name of the Company.

In present matter, there is no material to support averments that due to

power cuts, operations were required to be stopped. No positive material

is put on record of preparations to start production if name is restored. It

is argued by learned Senior Counsel for Respondent that Balance -

Sheets and Annual Reports put on record do not show machinery as the

assets. Excuse of Appellant who bought Company in 2006, (when ROC

record shows Returns were filed till 2015) that due to inadvertence and

lack of professional advice, Returns could not be filed, has no substance.

Registrar did not take Undertaking from Appellant and other Directors

under Section 248(6) of the Act cannot be reason for Appellant to claim

that name should be restored. In the absence of requisite material being

placed on record, even on merits of the matter, I am not able to record an

opinion that the Appeal deserves to be allowed.

23. In the above paragraphs, I have recorded my opinion with regard to

legal position as to how the Appeal should have been treated when the

Hon'ble Members recorded divergent views. Even on merits, I am of the

view that the Appeal deserves to be dismissed as has been recorded by

the Hon'ble Member (Technical).

Company Appeal (AT) No.171 of 2020 20

24. I direct that the present opinion/decision/Judgement may be

placed before the Regular Bench which recorded the divergent views for

the Hon'ble Bench to pass Orders with regard to disposal of the Appeal.

[Justice A.I.S. Cheema] Member (Judicial) rs

Company Appeal (AT) No.171 of 2020