Company name restored under Companies Act with conditions for compliance and director disqualification

The Tribunal decided to restore the company's name, Three Star Properties (P.) Ltd., under Sections 252(1) and 252(3) of the Companies Act, 2013. The restoration was subject to conditions, including filing all statutory compliances within 15 days, depositing a specified amount with the RoC, refraining from asset disposal, and submitting an affidavit of compliance. The order did not reinstate disqualified directors automatically, and the RoC retained enforcement powers for late filings and compliance matters.

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Issues Involved:
1. Restoration of the company's name under Section 252(1) and 252(3) of the Companies Act, 2013.
2. Non-filing of annual returns and financial statements.
3. Compliance with Section 455 regarding dormant companies.
4. Objections and observations from the Registrar of Companies (RoC) and the Income-tax Department.
5. Legal precedents and the "just" clause under Section 252(3).

Issue-wise Detailed Analysis:

1. Restoration of the Company's Name:
The appeal was filed under Section 252(1) read with Section 252(3) of the Companies Act, 2013, seeking to restore the name of Three Star Properties (P.) Ltd., which had been struck off by the RoC under Section 248 due to non-filing of annual returns and financial statements for three consecutive years. The appellant argued that the company was incorporated on October 8, 2010, to carry out real estate business and had commenced acquisition of a property in NOIDA. Despite the company's operations being halted due to a pending suit, the appellant maintained that they had been regular in filing Income-tax Returns.

2. Non-filing of Annual Returns and Financial Statements:
The appellant admitted to non-filing of financial statements and annual returns with the RoC, which led to the striking off. The appellant claimed they were unaware of the striking off until the director was disqualified due to non-compliance. The appellant sought restoration based on their continued business operations and regular filing of Income-tax Returns.

3. Compliance with Section 455 Regarding Dormant Companies:
The RoC contended that the company should have declared itself as a dormant company under Section 455 due to inactivity for two consecutive financial years. However, the RoC also stated that if the Tribunal decided to restore the company's name, it should be directed to file financial statements up to date.

4. Objections and Observations from the RoC and Income-tax Department:
The Income-tax Department had no objections to the restoration of the company's name, confirming no pending proceedings or data regarding cash deposits post-demonetization. The RoC's main opposition was the company's inactivity for two years prior to striking off. However, the Tribunal noted that under Section 252(3), it could restore the company's name if it appeared "just" to do so.

5. Legal Precedents and the "just" Clause under Section 252(3):
The appellant's counsel argued that the Tribunal had the power to restore the company's name under the "just" clause of Section 252(3), even if the company was not operational. The counsel cited several judgments, including the Bombay High Court's decision in Purushottamdas v. Registrar of Companies, Maharashtra, and the Delhi High Court's decisions in M.A. Panjwani v. Registrar of Companies and Kalinga Paper Mills (P.) Ltd. v. Ministry of Corporate Affairs. These precedents supported the restoration of a company's name when it was "just" to do so, especially in cases involving pending litigation and immovable property rights.

Tribunal's Decision:
The Tribunal concluded that there was a just ground for restoring the company's name, subject to specific terms and conditions:
- The company must file its annual returns, balance sheets, and other statutory compliances within 15 days of restoration.
- The company must deposit Rs. 2,00,000 with the RoC to cover fees, charges, and costs incurred by the RoC.
- The company must not alienate or dispose of any valuable assets until all compliances are met.
- The restoration order does not automatically restore disqualified directors' positions.
- An affidavit of compliance must be filed within two months.
- The RoC retains the power to proceed against the company and its directors for late filings and other compliance issues.

The appeal was disposed of accordingly.

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