Think Gas Ludhiana Private Limited vs Jay Madhok Energy Private Limited

IN THE MATTER OF: Think Gas Ludhiana Pvt. Ltd. ...Appellant Versus Jay Madhok Energy Pvt. Ltd. & Anr. ...Respondents Present: For Appellant : Mr. Amit Sibal, Sr. Advocate with Mr. Piyush Joshi, Ms. Sumiti Yadava, Ms. Trushita shrivastava, Mr. Riki Shahi, Advocates For Respondents : Mr. Sandeep Bajaj, Ms. Aakanksha Nehra, Ms. Shalaka Garg, Advocates for R-1

ORDER

22.05.2023: Heard Mr. Amit Sibal, Ld. Sr. Counsel assisted by Mr.

Piyush Joshi, Ld. Counsel for the Appellant and Mr. Sandeep Bajaj, Ld.

Counsel on behalf of Respondent No.1/caveator.

2. The present appeal under Section 421 of the Companies Act, 2013 has

been preferred against an order dated 20.04.2023 passed by National

Company Law Tribunal, New Delhi, Court-IV (herein after referred to as

'NCLT'). By the said order Ld. NCLT has dismissed the intervention petition

no. 5/ND/2023 in appeal no. 35/252/ND/2023.

3. It is reflected from the record that name of the company 'Ishar Gas

Jalandhar Pvt. Ltd.' was struck off by the Registrar of the company, while

exercising power under Section 248 of the Companies Act, 2013. After the

name of the Company was struck off, one of the shareholder namely 'Jay

Madhok Energy Pvt. Ltd.' under Section 252 (1) of the Companies Act, 2013

filed an application/appeal before the NCLT for restoration of the name of the

Company. At the moment, we are not required to deliberate on the issue as to

what ground was taken by the applicant/appellant before the NCLT for

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restoration of the name of company. The fact remains that while the appeal

was pending before the NCLT the present appellant filed an intervention

application vide I.A. No. 5/2023 with a prayer to allow him to be impleaded

as Respondent and also prayed in the application filed before the NCLT for

dismissal of the appeal pending before the NCLT which was filed on behalf of

the shareholder for restoration of the name of the company.

4. On the said application the Ld. NCLT has passed the impugned order

which is quoted herein below:

"New Intervention Petition/5/ND/2023

This is an application filed under Section 424 read with Ist Proviso to Section 252(1) of the Companies Act, 2013 with supporting affidavit seeking impleadment to make a representation and being heard for submission of material facts relating to Ishar Gas Ludhiana Private Limited and Ishar Gas Jalandhar Private Limited and their shareholders before passing the order for reinstatement of Ishar Gas Ludhiana Private Limited and Ishar Gas Jalandhar Private Limited. We have heard the submissions made by the Intervenor at length. The reliance placed by the Intervenor and his locus to intervene in the present matter are not established beyond doubt. The Intervenor has prayed for passing an order impleading him as a party respondent and to take on record the documents and submissions made in this application by the applicant and allowing the applicant to make a representation to be heard as a "person concerned" under the 1st Proviso of Section 252(1) of the Companies Act, 2013 and also prayed for dismissal of the present appeal filed by Jay Madhok Energy Pvt Ltd. or to pass such further orders in the matter.

Learned Counsel for the appellant has relied upon the decision reported in 2018 SCC Online NCLT 399 and invited the attention of this Tribunal to paras 7 to 9. Para No. 7 of the aforesaid judgment clearly shows that the "person concerned" or "any other person" shall include aggrieved person and here the applicant is a rival competitor who is also doing same and similar kind of business in a different/neighbouring area.

CA (AT) No. 76 of 2023 3 Therefore, it cannot be presumed that the competitor has moved this application with a bonafide purpose and since the prayer made in the application also includes dismissal of the present appeal, we do not find any merit in allowing the present application. Further, the purpose of Section 252 is to provide an opportunity to those companies whose names have been struck off by RoC and to provide an opportunity to conduct their business and therefore, keeping the object of Section 252(1) in account, the present application is devoid of merit. Therefore, the application is dismissed without costs.

Let the matter be fixed for 30.05.2023".

5. Aggrieved with the order impugned the appellant has approached this

Tribunal by way of filing the present appeal. Mr. Sibal, Ld. Sr. Counsel for the

Appellant assailing the impugned order has argued that Ld. NCLT has

incorrectly recorded that the appellant was not having any locus to maintain

the present petition. Mr. Sibal, Ld. Sr. Counsel has specially drawn our

attention to proviso to Section 252 (1) of the Companies Act, 2013 to show

that the legislature itself has intended to allow the NCLT to pass order after

hearing the company as well as the Registrar and also 'person concerned'.

6. He submits that the meaning of the word 'person concerned' as

mentioned in proviso to Section 252 (1) of the Act is wide enough. Taking aid

of the proviso Ld. Sr. Counsel submitted that the appellant was entitled to

maintain the intervention application. He also tried to persuade the court that

many of the information which were not disclosed by the appellant before the

NCLT were within the knowledge of the appellant herein and as such for just

decision in the matter it was required to bring those facts to the notice of the

NCLT. He has also drawn our attention to an order passed by Petroleum and

Natural Gas Regulatory Board ('PNGRB') New Delhi in Case No.

Legal/20/2022 [Old Case No. Legal/1-BC (2)/2019]. He has drawn our

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attention to paragraph 22 at running page 126 of Vol. I of the Memo of Appeal.

It would be better to reproduce paragraph 22 as follows:

"22. It is the case of Complainant that the Authorisation of "Jay Madhok Energy Private Limited Led Consortium" lapsed with the dissolution and strike out of both Jay Madhok Energy Private Limited and Jay Madhok Holdings Private Limited on 08.08.2018, and the "Ishar Gas Jalandhar Pvt. Ltd.", "Ishar Gas Ludhiana Pvt. Ltd." has been struck off and dissolved by ROC vide Notification dated 20.04.2022. The Board is of the view that both the parties may take recourse in appropriate forum to avail the remedial action, available to them if so advised".

7. Mr. Sibal, Ld. Sr. Counsel for the Appellant by way of referring to

aforesaid facts submits that it was required by the NCLT at the time of hearing

the appeal for restoration to consider those facts. He submits that in view of

rejection of this intervention application it would be difficult for NCLT to pass

appropriate order in accordance with law.

8. On aforesaid ground it has been prayed for setting aside the impugned

order. Ld. Counsel for the caveator has opposed this prayer and submitted

that there is no error in the impugned order warranting interference.

9. Besides, herein Ld. Counsel for the parties, we have perused the

materials available on record. Before proceeding it would be better to

reproduce Section 252 (1) of the Companies Act, 2013 which is as follows:

(1) Any person aggrieved by an order of the Registrar , notifying a company as dissolved under section 248, may file an appeal to the Tribunal within a period of three years from the date of the order of the Registrar and if the Tribunal is of the opinion that the removal of the name of the company from the register of companies is not justified in view of the absence of any of the grounds on which the order was passed by the Registrar, it may order restoration of the name of the company in the register of companies:

Provided that before passing any order under this section, the Tribunal shall give a reasonable opportunity of making

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representations and of being heard to the Registrar, the company and all the persons concerned:

Provided further that if the Registrar is satisfied, that the name of the company has been struck off from the register of companies either inadvertently or on the basis of incorrect information furnished by the company or its directors, which requires restoration in the register of companies, he may within a period of three years from the date of passing of the order dissolving the company under section 248, file an application before the Tribunal seeking restoration of name of such company".

10. On examination of the aforesaid provision it is evident that Section 252

(1) is meant for a person concerned particularly the Company or its Director

to approach the NCLT for restoration of the Company whose name has been

struck off under Section 248 of the Companies Act, 2013. Of course, proviso

provides that before passing order the Ld. NCLT is also required to hear

Registrar of the Company/ Person Concerned.

11. It is also not disputed that intervention application was filed under

Section 252 (1) of the Companies Act, 2013 read with Rule 11 of the NCLT.

On examination of Section 252 (1) it is evident that any person aggrieved by

an order of striking off/dissolving a company by the ROC can maintain an

application for its restoration on certain condition. The purport of the Section

252 (1) is to enable the aggrieved person to file application for restoration of a

struck off company. Admittedly, the appellant herein cannot be categorised

as a person who is interested to make a prayer for restoration of the company

in question. On the contrary he is praying for dismissal of the

application/appeal for restoration of the company to Register of ROC.

12. It is clear from the intervention application which was filed before the

NCLT that the appellant before this Appellate Tribunal had prayed before the

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NCLT for dismissal of the appeal filed by the shareholder of the struck off

company. Meaning thereby that the appellant had filed intervention not for

restoration but to oppose the same.

13. The proviso to Section 252 (1) of the Companies Act, 2013 mandates

that the tribunal before passing order in favour of restoration of a company

shall also grant reasonable opportunity for making a presentation to the

Registrar of the Company and all person concerned. Since, the name of the

Company was struck off by the Registrar of the Company exercising power

under Section 248 of the Companies Act, 2013 it was necessary to adhere to

the Principles of Natural Justice. This is the reason that legislation has taken

care that without hearing Registrar no order may be passed for restoration of

a struck off company.

14. The word 'person concerned' as mentioned in the proviso may not be

widen to create such right to a person who is not connected with the affairs

of a struck off company. Moreover, provision contained in Section 252 of the

Act is to be read together with Section 248 of the Act which provides the

circumstances for removal of the name of a company from Register of

Companies.

15. At this juncture, we would like to quote Section 248 of the Companies

Act, 2013 which deals with the striking of the name of the Company as

follows:

Section 248: Power of Registrar to remove name of company from register of companies.

"248. (1) Where the Registrar has reasonable cause to believe

that--

(a) a company has failed to commence its business within one year of its incorporation 1[or];

(b) 2[***]

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(c) a company is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any application within such period for obtaining the status of a dormant company under 3[section 455; or]

(d) the subscribers to the memorandum have not paid the subscription which they had undertaken to pay at the time of incorporation of a company and a declaration to this effect has not been filed within one hundred and eighty days of its incorporation under sub-section (1) of section 10A; or

(e) the company is not carrying on any business or operations, as revealed after the physical verification carried out under sub-section (9) of section 12.] he shall send a notice to the company and all the directors of the company, of his intention to remove the name of the company from the register of companies and requesting them to send their representations along with copies of the relevant documents, if any, within a period of thirty days from the date of the notice.

(2) Without prejudice to the provisions of sub-section (1), a company may, after extinguishing all its liabilities, by a special resolution or consent of seventy-five per cent. members in terms of paid-up share capital, file an application in the prescribed manner to the Registrar for removing the name of the company from the register of companies on all or any of the grounds specified in sub-section (1) and the Registrar shall, on receipt of such application, cause a public notice to be issued in the prescribed manner:

Provided that in the case of a company regulated under a special Act, approval of the regulatory body constituted or established under that Act shall also be obtained and enclosed with the application.

(3) Nothing in sub-section (2) shall apply to a company registered under section 8.

(4) A notice issued under sub-section (1) or sub-section (2) shall be published in the prescribed manner and also in the Official Gazette for the information of the general public.

(5) At the expiry of the time mentioned in the notice, the Registrar may, unless cause to the contrary is shown by the company, strike off its name from the register of companies, and shall publish notice thereof in the Official Gazette, and on the publication in the Official Gazette of this notice, the company shall stand dissolved.

(6) The Registrar, before passing an order under sub-section (5), shall satisfy himself that sufficient provision has been

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made for the realisation of all amount due to the company and for the payment or discharge of its liabilities and obligations by the company within a reasonable time and, if necessary, obtain necessary undertakings from the managing director, director or other persons in charge of the management of the company:

Provided that notwithstanding the undertakings referred to in this sub-section, the assets of the company shall be made available for the payment or discharge of all its liabilities and obligations even after the date of the order removing the name of the company from the register of companies.

(7) The liability, if any, of every director, manager or other officer who was exercising any power of management, and of every member of the company dissolved under sub-section (5), shall continue and may be enforced as if the company had not been dissolved.

(8) Nothing in this section shall affect the power of the Tribunal to wind up a company the name of which has been struck off from the register of companies".

16. The name of the company can be struck off by the Registrar as per

situation contemplated under Section 248 of the Act. If we read Section 248

and Section 252 of the Act together has been referred herein above, it is clear

that if a company is struck off under certain situation who would be the

person concerned to approach for its restoration. An appeal for restoration

can be filed either under Section 252 (1) or Section 252 (3). Section 252 (1)

gives a right for filing application within a period of three years, whereas the

said period has been enhanced up to 20 years in Section 252 (3).

17. On examination of aforesaid facts and circumstances as well as

admitted fact that the appellant herein had not filed intervention application

before the NCLT in support of the restoration; rather he made specific prayer

for dismissal, in such situation the Ld. NCLT has committed no error in

rejecting the intervention application.

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18. We don't find any apparent error in the impugned order warranting

interference. Accordingly, the appeal stands dismissed.

[Justice Rakesh Kumar] Member (Judicial)

[Dr. Alok Srivastava] Member (Technical)

sr/gc

CA (AT) No. 76 of 2023