2021 (1) TMI 984 - Tri - Companies Law

Tribunal Orders Restoration of Company Name and Status: Compliance Emphasized

The Tribunal granted the application for restoration under Section 252 of the Companies Act, 2013, directing the Registrar of Companies to restore the ... Seeking restoration of name of the Company in the Register of Companies - Section 252 of the Companies Act, 2013 - HELD THAT:- The counsel for applicants has filed provisional balance sheet for the financial years 2017-18 and 2018-19. He has also filed provisional income tax returns for the financial year 2017-18 and 2018-19 along with memo dated 17.08.2020. As seen from the provisional profit and loss statement for the year ended 2017-18 the company is having revenue from operations at ₹ 2,20,000/-. As seen from the provisional profit and loss statement for the year ended 2018-19 the Company is having revenue from operations is shown at ₹ 2,85,000/- This shows the company is ongoing concern. The applicants complied the requirements pointed out by the ROC, in his report. Therefore there are grounds to restore the company - Further, it is also seen that the latest Balance sheet as on 31st March 2017 of the Company. The Company is having total Assets (Non-current and current) at ₹ 33,124/- and Revenue from operations is at ₹ 1,95,000/- as on 31.03.2017. After going through the provisions of Section 252 (3) of the Companies Act, 2013, this Tribunal is of the view that the Company was in existence and it is a going concern and name of Company to be restored in the Register of Companies as maintained by RoC - Registrar of Companies, the respondent herein, is ordered to restore the original status of the Applicant Company as if the name of the company has not been struck off from the Register of Companies and take all consequential actions like change of company's status from 'strike off' to Active (for e-filing), to restore and activate the DINs if applicable, to intimate the bankers about restoration of the name of the company so as to defreeze its accounts - Application allowed. Issues:Application under Section 252 of the Companies Act, 2013 for restoration of Company's name in the Register of Companies.Detailed Analysis:1. Application Details: The Applicants, who are Shareholders and Directors of the Company, filed an application under Section 252 of the Companies Act, 2013, seeking restoration of the Company's name in the Register of Companies. They highlighted the Company's business activities, financial status, and reasons for non-compliance with filing requirements.2. Contentions of Applicants: The Applicants explained that due to economic challenges and a recession in the real estate sector, the Company faced operational difficulties leading to delayed filings. They expressed their intention to revive the Company, emphasizing its potential for growth and contribution to the economy. The Applicants assured timely compliance with all statutory obligations once the name restoration is granted.3. Respondent's Objections: The Respondent, Registrar of Companies, Hyderabad, opposed the application citing non-compliance with filing requirements and issuance of strike-off notices. The Respondent highlighted the Company's failure to submit balance sheets, annual returns, and other essential documents for several years, leading to the Company's strike-off status.4. Legal Provisions: Section 252(3) of the Companies Act, 2013 allows restoration of a Company's name if it was carrying on business or if restoration is deemed just. The Tribunal considered this provision along with the arguments presented by both parties.5. Tribunal's Decision: After reviewing the submissions, financial statements, and compliance efforts of the Applicants, the Tribunal concluded that the Company was a going concern and warranted restoration. The Tribunal exercised its powers under Section 252 and directed the Registrar of Companies to restore the Company's name, subject to specified conditions and payment of costs.6. Directions for Restoration: The Tribunal issued detailed directions for the restoration process, including filing statutory documents, payment of costs, and compliance within a specified timeline. The Applicants were instructed to ensure full adherence to the Tribunal's orders to facilitate the Company's revival.7. Final Orders: The Tribunal ordered the Registrar of Companies to restore the Company's name, change its status to active, and take necessary actions to unfreeze accounts. The Tribunal emphasized the importance of compliance and directed the Applicants to deliver a certified copy of the order to the Registrar within the stipulated timeframe.8. Conclusion: The Tribunal's judgment granted the application for restoration, recognizing the Company's potential for growth and contribution to the economy. The detailed directions provided a roadmap for the Company's revival, ensuring adherence to legal requirements and regulatory standards.