Tribunal orders restoration of J.R. Diamonds Pvt. Ltd. name after finding Registrar's action invalid

The Tribunal allowed the appeal filed by the Liquidator of M/S. J. R. Diamonds Pvt. Ltd., directing the Registrar of Companies (ROC) to restore the company's name in the statutory register. The Tribunal found the ROC's action of striking off the company's name during the Corporate Interim Resolution Process (CIRP) and moratorium under the Insolvency and Bankruptcy Code to be legally invalid. The company's name was ordered to be reinstated subject to specific conditions, including filing overdue statutory returns, publishing restoration notices, settling statutory dues, and informing relevant authorities.

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Issues Involved:
1. Restoration of the company's name in the statutory register.
2. Compliance with Section 252 of the Companies Act, 2013.
3. Validity of the ROC's action during the Corporate Interim Resolution Process (CIRP).
4. Legal implications of the moratorium under Section 14 of the I.B. Code.
5. Overriding effect of Section 238 of the I.B. Code.
6. Conditions for restoring the company's name.

Issue-wise Detailed Analysis:

1. Restoration of the company's name in the statutory register:
The appeal was filed by the Liquidator of M/S. J. R. Diamonds Pvt. Ltd. seeking restoration of the company's name, which was struck off by the Registrar of Companies (ROC), Gujarat on 06.08.2018. The Liquidator contended that the company had assets and pending litigation, which necessitated its name to remain on the register.

2. Compliance with Section 252 of the Companies Act, 2013:
The Tribunal examined Section 252(1) and 252(3) of the Companies Act, 2013, which allows aggrieved persons to appeal against the ROC's order within three years. The Tribunal found that the appeal was filed within the permissible period and that the removal of the company's name was not justified as it had ongoing business operations and litigation.

3. Validity of the ROC's action during the Corporate Interim Resolution Process (CIRP):
The Tribunal noted that the CIRP for the company commenced on 13.02.2018, and a moratorium was declared under Section 14 of the I.B. Code. During this period, no legal proceedings could be initiated against the company. The ROC's action to strike off the company's name during this moratorium was deemed legally invalid.

4. Legal implications of the moratorium under Section 14 of the I.B. Code:
Section 14 prohibits the initiation of suits or proceedings against the corporate debtor during the CIRP. The Tribunal emphasized that the ROC's action violated this provision, as the company was under moratorium protection when its name was struck off.

5. Overriding effect of Section 238 of the I.B. Code:
Section 238 of the I.B. Code states that the provisions of the Code shall prevail over any other law. The Tribunal held that the ROC's action was void due to the overriding effect of the I.B. Code, reinforcing that the company's name should not have been struck off during the CIRP.

6. Conditions for restoring the company's name:
The Tribunal allowed the appeal conditionally, directing the ROC to restore the company's name subject to the following conditions:
- The Liquidator must file all overdue statutory returns with the required fees and penalties within 90 days.
- A notice of the restoration must be published in leading newspapers and the Official Gazette at the Liquidator's expense.
- The Liquidator must verify and settle statutory dues as per the I.B. Code provisions.
- The Liquidator must communicate the order to the ROC and other statutory authorities.

Conclusion:
The Tribunal concluded that the ROC's action to strike off the company's name was not justified due to the ongoing CIRP and the moratorium under the I.B. Code. The appeal was conditionally allowed, and the company's name was ordered to be restored in the statutory register, subject to compliance with the specified conditions.

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