2023 (6) TMI 103 - AT - Companies Law

Seeking restoration of the name of the Company in the Register maintained by the Registrar of Companies - HELD 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 it is observed 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. The name of the Company be restored to the Register of Companies subject to the compliances fulfilled - application allowed.

Summary

Issues Involved:
The appeal under Section 421 of the Companies Act, 2013 regarding restoration of the company's name in the Register maintained by the Registrar of Companies (RoC), Mumbai.

Facts and Arguments:
The Appellant-Company, incorporated under the Companies Act, 1956, faced challenges due to the demise of the main Director and the hospitalization of the Secretary. Despite these events, the company continued its business operations smoothly. The Registrar of Companies issued notices for striking off the company's name from the Register due to alleged inactivity. The Appellant filed an appeal for restoration under Section 252 of the Companies Act, 2013, which was dismissed by the National Company Law Tribunal. The Appellant contended that the non-filing of annual returns was inadvertent, and the company remained active, submitting audited accounts for the relevant years.

Decision and Rationale:
After considering the submissions, the Appellate Tribunal found that the company failed to file financial statements and annual returns for specific years due to changing circumstances. The audited accounts demonstrated the company's active status and ongoing business operations. The Tribunal concluded that the order of the National Company Law Tribunal and the Registrar of Companies was unsustainable in law. Consequently, the impugned order was set aside, and the company's name was directed to be restored in the Register, subject to certain compliances, including payment of costs and filing of necessary documents.

Outcome:
The Appellate Tribunal allowed the appeal, directing the restoration of the company's name in the Register maintained by the Registrar of Companies. The company was required to fulfill specified compliances, including payment of costs, filing of annual returns and balance sheets, and adherence to applicable charges/fees. The Registrar of Companies retained the authority to take punitive steps under the Companies Act, 2013 for any non-compliance by the company and its directors. The judgment was to be uploaded on the Tribunal's website and shared with the National Company Law Tribunal (Mumbai Bench).