Restoration Order for Company Name and Director Disqualification Reversed

The National Company Law Tribunal, Kochi Bench, ordered the restoration of a private company's name in the Register of Companies under Section 252(3) of the Companies Act, 2013. The company's directors were disqualified, leading to non-compliance with filing requirements and strike-off action by the Registrar of Companies. The Tribunal directed the Registrar to restore the company's status, activate DINs, and defreeze accounts within 30 days, subject to pending document submission and fine payment. Shareholders had to provide an Undertaking, and the company faced restrictions on asset disposal until compliance, with the order to be published in the official gazette.

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Issues: Restoration of Company Name in Register of Companies

Detailed Analysis:

1. Background: The appeal was filed under Section 252(3) of the Companies Act, 2013 by a private company seeking restoration of its name in the Register of Companies maintained by the Registrar of Companies, Kochi.

2. Company's Business: The main business of the appellant company, as per its Memorandum of Association, includes providing services in Web Information Technology, IT enabled services, Business Process Outsourcing, and trading of IT products.

3. Non-compliance and Reasons: The company failed to file its accounts and returns for the financial years 2013-14 to 2018-19 due to the departure of an employee responsible for filings and lack of knowledge about the Companies Act, 2013 provisions.

4. Disqualification and Deactivation: Both directors were disqualified by the Registrar of Companies, Kerala, and their DIN numbers were deactivated, hindering the filing of accounts and returns.

5. Registrar's Report: The Registrar of Companies initiated strike-off action against the company for non-compliance with filing requirements, leading to the company's name being struck off from the register.

6. Reasons for Strike-off: The strike-off was attributed to negligence and lack of due diligence by the directors in fulfilling statutory duties and responding to notices, violating Sections 92/137 of the Companies Act, 2013.

7. Tribunal's Consideration: The Tribunal reviewed the appellant's arguments, the ROC's report, the company's financial statements, and the Income Tax Return Acknowledgment for the Assessment Year 2019-20.

8. Legal Provision: Section 252(3) of the Companies Act, 2013 allows for the restoration of a company's name if it was carrying on business or if restoration is deemed just.

9. Tribunal's Decision: The Tribunal ordered the restoration of the company's name, directing the ROC to restore the company's status, activate DINs, and inform bankers to defreeze accounts. The company was given 30 days to file pending documents and pay a fine.

10. Compliance and Undertaking: Shareholders were required to submit an Undertaking regarding the company's financial transactions during demonetization, and the appellant had to ensure compliance with the order.

11. Restrictions and Publication: The company was prohibited from disposing of assets until compliance, and the ROC was directed to publish the order in the official gazette.

12. Future Actions: The order did not limit the respondent's power to take action against the company and its directors for late filings under the Companies Act, 2013.

This detailed analysis outlines the background, reasons for non-compliance, legal provisions, tribunal's decision, and post-restoration requirements as per the judgment of the National Company Law Tribunal, Kochi Bench.

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