Tribunal restores company name despite compliance failures, emphasizes ongoing business activities.

The National Company Law Tribunal, Chennai Bench, granted the Applicant's plea for restoration of the company's name in the Register maintained by the Respondent under Section 252(3) of the Companies Act, 2013. Despite compliance failures, the Tribunal exercised discretion, emphasizing the company's ongoing business activities evidenced by financial records. Specific directions were issued for compliance post-restoration, including filing pending returns, payment of costs, and adherence to statutory requirements within specified timelines. The judgment underscores the importance of compliance and the Tribunal's authority to restore struck-off company names based on evidence of business operations.

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Issues:
- Restoration of company name in the Register maintained by Respondent under Section 252(3) of the Companies Act, 2013.
- Compliance requirements for filing Annual Financial Statements and Annual Returns.
- Evidence of company's business activities and operation.
- Discretion of the Tribunal to restore the name of the Company.
- Directions for restoration and compliance post restoration.

Issue 1: Restoration of Company Name
The Applicant sought restoration of the company name in the Register maintained by the Respondent after it was struck off under Section 252(3) of the Companies Act, 2013. The Applicant, a Shareholder cum Director, argued that the company was active since its incorporation and regularly held Annual General Meetings. The Respondent had struck off the company's name due to non-compliance with filing requirements, leading to the present Application for restoration.

Issue 2: Compliance Requirements
The Applicant acknowledged the failure to file Annual Financial Statements and Annual Returns with the Respondent, attributing it to a lack of awareness and not engaging a Company Secretary for the task. The Respondent highlighted the statutory and procedural compliance lapses as the basis for striking off the company's name, emphasizing the need for the company to prove its business operations and justify the restoration request.

Issue 3: Evidence of Business Activities
In support of the restoration plea, the Applicant submitted evidence including Audited Financial Statements, Income Tax Acknowledgments, and Bank Statements spanning multiple financial years. Despite the compliance shortcomings, the Tribunal noted that the company was active and operational, conducting business activities as evidenced by the financial records and bank statements provided.

Issue 4: Tribunal's Discretion
Considering the provisions of Section 252 of the Companies Act, 2013, the Tribunal exercised its discretion to restore the company name, emphasizing the importance of demonstrating ongoing business operations at the time of striking off. The Tribunal found it just to grant the restoration based on the evidence presented by the Applicant and the mitigating circumstances surrounding the compliance failures.

Issue 5: Directions for Restoration and Compliance
The Tribunal granted the Application, ordering the restoration of the company's name in the Register maintained by the Respondent. Specific directions were issued, including the filing of pending returns and documents, payment of costs for revival, restrictions on asset disposal, and compliance with statutory requirements within specified timelines. The order clarified that restoration did not automatically absolve directors of disqualifications under Section 164 of the Companies Act, 2013, emphasizing the need for strict compliance with the law post-restoration.

This judgment by the National Company Law Tribunal, Chennai Bench, highlights the significance of compliance with statutory requirements for companies and the discretion of the Tribunal to restore struck-off company names based on evidence of ongoing business activities. The detailed analysis of evidence, compliance lapses, and restoration directions underscores the legal principles governing company restoration proceedings under the Companies Act, 2013.

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