Sirsa Jute Mills Private Limited And Anr vs Registrar Of Companies

[Arising out of order dated 01.03.2021 passed by the National Company Law Tribunal (New Delhi Bench, Court-II) in Appeal No. 504/252(ND)/2020]

IN THE MATTER OF: 1. Sirsa Jute Mills Private Limited 1242/2, 2nd Floor, Jain Bhawan, Rangmahal, Delhi-110006 ....... Appellant No. 1.

2. ACME Consultants Pvt. Ltd. 21 A Shakespeare Sarani, Kolkata 700017. ....... Appellant No. 2.

Versus 1. The Registrar of Companies NCT of Delhi and Haryana 4th Floor, IFCI Tower, Nehru Place, New Delhi-110019. ....... Respondent.

Present: For Appellant: Ms. Sadapurna Mukherjee, Advocate. For Respondent:- None. JUDGMENT

(16th February, 2023)

Justice Anant Bijay Singh;

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

been filed by the Appellants being aggrieved and dissatisfied by the order dated 2

01.03.2021 passed by the National Company Law Tribunal (New Delhi Bench,

Court-II) in Appeal No. 504/252(ND)/2020 whereby and whereunder appeal filed

by the Appellant company through its Shareholder M/s Acme Consultants

Private Limited for restoration of the name of the Appellant Company in the

register maintained by the Registrar of Companies (RoC), NCT of Delhi and

Haryana was dismissed by the Tribunal.

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

i) Since incorporation in the year 1995, the Appellant company has duly

complied with all the regulatory compliances and had filed its Income Tax

Returns and TDS Returns under the Income Tax Act, 1961 with the Income Tax

department, Government of India. The Memorandum and Articles of Association

of the company was also filed before the Income Tax Department. The accounts

of the Appellant Company have been audited for the period ended 31.03.2008.

ii) There are three Directors of the company and there are 10 shareholders of

the company holding 10200 equity shares of Rs. 10/- each which is evident in

the Annual Return for 2007-08 showing list of shareholders (Annexure-F of the

Appeal). The Appellant No. 1 is having an immovable property situated at Sirsa

which is evident from the Balance Sheet. The Appellant No. 1 was actively doing

its business activities and was also clear from the fact that the Appellant

Company is maintaining a Current Accounts with the Oriental Bank of

Commerce & Indian Overseas Bank (Annexure-G, Colly of the Appeal).

iii) Further case is that after filing of Statutory records of the company in the

year 2008, the Appellant company could not able to file its further records as

Company Appeal (AT) No. 26 of 2022 3

there were some internal disputes among the shareholders and management of

the company and further the Income Tax Department had also taken illegal

action against the company which further defaults the company in filing the

statutory records before the ROC. When the disputes of the company were

resolved, the shareholder of the company before nation lockdown due to Covid-

19 had tried to check from the MCA-21 website, the status of the company with

regard to the filing of the records before the ROC and while checking the same,

the Appellant No. 2, one of the shareholders came to know that the name of the

Appellant company had been struck off from the register of the companies

showing as "Strike Off".

iv) Thereafter, the shareholder of the company had engaged a Company

Secretary in whole time practice to advice for the aforesaid issue with regard to

struck off of the company. The Company Secretary informed that the name of

the Appellant company has been struck off from the register maintained by the

Registrar of Companies, Delhi and the only way to restore the name of the

company is to file an Appeal before the NCLT for restoration of the name of the

Appellant company into the register of the Companies maintained by the

Registrar of Companies. Thereafter, being aggrieved by the notice of the

Respondent of "Striking Off", the Appellant Company approached the Tribunal

under Section 252 of the Companies Act, 2013 for revival of the Appellant

Company and after hearing both the parties, the Tribunal passed the order

impugned which led to filing of this Appeal.

Company Appeal (AT) No. 26 of 2022 4

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

grounds mentioned in the memo of appeal, submitted that the Tribunal erred in

dismissing the Appeal and the same has been done mechanically without

appreciating the provisions of law in its entirety. Further, the Tribunal also failed

to consider that the act of the Respondent while striking off the name of the

company from its register was unjust and unreasonable and such action of the

Respondent impose unreasonable restrictions on the Appellant's fundamental

right to carry on trade, business, occupation and or profession guaranteed by

the Article 19(1)(g) of the Constitution of India on the ground that it wasn't a

going concern whereas it has an immovable property in Sirsa which can be

rented and furnish good rentals.

4. It is further submitted that if the Appellant company is restored, the

Appellant company would be able to continue the work and generate rent which

would, inter-alia, benefit the Central/State Government in terms of Income Tax,

Goods & Service Tax (GST) and other taxes. The Appellant company could not

be filed statutory records before the Registrar of Companies after 2008, due to

the aforesaid circumstances and after resolution of the disputes among the

shareholders and the management of the company, the company is now in the

position to file all its statutory records in accordance with the prescribed

procedure prescribed under the Act since the shareholders have resolved

differences. The delay is filing the Balance sheets and Annual Returns were not

intentional but were inadvertent. As per Companies Act, if there is delay in filing

of the Balance sheets and Annual Returns certain formalities has to be complied

Company Appeal (AT) No. 26 of 2022 5

with the company and the company shall comply with the formalities as required

under the Act once the name of the company is restored to the Register of the

Companies.

5. It is further submitted that the Appellant Company is losing its legal

status/entity to run or deal the day-to-day operations/business activities which

is contrary to the interest of all shareholders and directors.

In view of the above submissions, the impugned order is fit to be set aside

and the instant Appeal may be allowed.

6. On the other hand, the Respondent/Registrar of Companies in his reply

stated that as per available records on MCA-21 Portal, the signatories associated

with the Appellant company were found namely Ghanshyam Sarda, Preet Sarda

and Sunanda Sarda. The Company was incorporated on 31.07.1995 and the

Appellant Company has filed Annual Returns and Balance Sheet only uptil the

financial year that ended on 31.03.2008. Moreover, no subsequent documents

had been filed by the Company with this office to obtain the status of a "Dormant

Company" under Section 455 of the Companies Act, 1956. Hence this office had

reasonable cause to believe that the company was not in operation and therefore,

the name of the company was considered for striking off from the Register of

Companies.

7. It is further stated that the Office of the Registrar of Companies issued the

notice in the form of STK-1 in March, 2017 intimating the company and the

directors of the company at their registered office about the aforesaid defaults,

providing them a fair opportunity to respond. Subsequently, this office also

Company Appeal (AT) No. 26 of 2022 6

issued public notice for the same in the form of STK-5 dated 28.04.2017.

Thereafter, the name of the company was struck off as per the provision of

Section 248(1)(c) of the Companies Act, 2013 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 07.06.2017.

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

of the parties, we observed that the Appellant Company was in some internal

disputes among the shareholders and management of the Company. Further,

the Income Tax Department had also taken action against the Company which

further defaults the Company in filing the statutory records before the Registrar

of Companies. The Balance Sheet shows that the Appellant Company is having

an immovable property situated at Sirsa. Hence, we are of the view that the order

passed by the National Company Law Tribunal (New Delhi Bench, Court-II) as

well as Registrar of Companies, NCT of Delhi & Haryana is not sustainable in

law.

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

01.03.2021 passed by the National Company Law Tribunal (New Delhi Bench,

Court-II) in Appeal No. 504/252(ND)/2020. The name of the Appellant 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, NCT of Delhi & Haryana within

eight (8) weeks from the passing of this Judgment.

Company Appeal (AT) No. 26 of 2022 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 Balances 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.

10. 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 (New

Delhi Bench, Court-II), forthwith.

[Justice Anant Bijay Singh] Member (Judicial)

[Mr. Kanthi Narahari] Member (Technical)

New Delhi 16thFebruary, 2023 R. Nath.

Company Appeal (AT) No. 26 of 2022