Court Restores Company in Register Under Companies Act 1956

The court allowed the petition under Section 560(6) of the Companies Act, 1956, seeking restoration of a company in the register. The court emphasized that restoration should be the norm unless there are special circumstances against it. It found the petitioners, who were creditors, had standing to file the petition and rejected claims of collusion with the company. The court dismissed the plea of res judicata as the petitioners were not parties to earlier proceedings. Consequently, the court restored the company to its original status, directing the ex-management to fulfill statutory obligations and leaving open the issue of concealment for further proceedings.

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Issues:
1. Application for impleadment/intervention by ZTE Corporation under Order 1 Rule 10 read with Section 151 Code of Civil Procedure.
2. Petition under Section 560(6) of the Companies Act, 1956 seeking restoration of a company in the register maintained by the Registrar of Companies.

Analysis:
1. The application for impleadment/intervention by ZTE Corporation under Order 1 Rule 10 read with Section 151 Code of Civil Procedure was filed but became infructuous as the applicant was already heard on merits. Thus, the application was disposed of.

2. The petition under Section 560(6) of the Companies Act, 1956 sought restoration of a company in the register maintained by the Registrar of Companies. The petitioners claimed to have worked as consultants to the company and had outstanding salaries. The petition highlighted that the company had won an arbitration case against another company and was not taking steps to enforce the Foreign Award. The petitioners sought restoration of the company to the register and to be placed in the same position as if its name had never been struck off.

3. The court examined the scope of Section 560(6) of the Act, emphasizing that restoration should be allowed unless there are special circumstances against it. Referring to legal precedents, the court noted that restoration should be the norm rather than the exception. The court interpreted 'just' as fair and prudent commercially, considering the societal impact.

4. The court found that the petitioners had standing to file the petition as creditors, and rejected claims of collusion with the company. The court also dismissed the plea of res judicata, noting that the petitioners were not parties to the earlier proceedings. Consequently, the court allowed the petition, restoring the company to its original status.

5. The court directed the ex-management of the company to fulfill statutory obligations, and left open the issue of concealment by the company to be decided by the concerned court. The rights and contentions of both parties regarding this issue were left open for further proceedings. The petition was disposed of with these observations.

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