2022 (11) TMI 649 - AT - Companies Law

Company Restoration Appeal Dismissed for Lack of Evidence - Statutory Compliance Emphasized

The appeal under Section 421 of the Companies Act, 2013, seeking restoration of a Company on the Register of Registrar of Companies West Bengal was ... Seeking restoration of name of the company in the Register of Companies - non-filing of the return/ statement of account before the RoC - Section 252 (3) of the Companies Act, 2013 - HELD THAT:- In the Companies Act, 1956 the power for striking off the company was primarily incorporated in Section 560 of the Act - In the present case it is noticed that under Section 560 (1), 560 (2) and 560 (3) notices were issued due to non-filing of the return/ statement of account before the RoC. It has not been disputed that from the Appellant side any steps were taken to cure the defect enabling the Registrar to pass an order for withdrawal of the notice. On the contrary after waiting for long time finally on 28.11.2011 exercising power under sub Section (5) of Section 560 of the Companies Act, 1956 the Appellant/Companies name was struck off and the Company was directed to be dissolved. On going through the order dated 13.11.2014 it is difficult to decipher as to whether the Appellant in terms of provision contained in Section 252 (3) of the Companies Act, 2013 had given any indication that at the time of striking off the Company i.e. as on 28.11.2011 the Appellant/Company was carrying on any business or was in operation nor there was any otherwise situation to justify the restoration of name of the Company. It is true that this Tribunal is taking lenient view in Appeals filed against the refusal of restoration of the Company but if such leniency is adopted in each and every Appeals certainly the provision contained under Section 248 of the Companies Act, 2013 may be termed as redundant. In the present case considering the fact that dispute which is being raised before this Appellate Tribunal has finally been set at rest by Hon’ble Supreme Court there is no reason to pass a different order than to dismiss this Appeal - appeal dismissed. Issues:1. Appeal under Section 421 of the Companies Act, 2013 against NCLT's order.2. Restoration of Company on the Register of Registrar of Companies West Bengal.3. History of the appeal and previous legal proceedings.4. Application for restoration under Section 560(6) of the Companies Act, 1956.5. Orders by Calcutta High Court and subsequent appeals.6. Competency of the shareholder to file the restoration petition.7. Examination of relevant provisions of Companies Act, 1956 and 2013.8. Justification for restoration of the Company.9. Interpretation of Section 252(3) of the Companies Act, 2013.Detailed Analysis:1. The judgment deals with an appeal under Section 421 of the Companies Act, 2013 against an NCLT order rejecting an application for restoration of a Company on the Register of Registrar of Companies West Bengal. The appeal stemmed from an order dated 14.12.2020 passed by NCLT Kolkata Bench in CP No. 74/KB/2019.2. The appeal had a complex history involving the incorporation of the Company in 1984 under the Companies Act, 1956, subsequent relocation of the registered office to West Bengal, and the eventual striking off of the Company's name from the Register of Registrar of Companies due to non-compliance with statutory requirements.3. Various legal proceedings ensued, including applications for restoration under Section 560(6) of the Companies Act, 1956, which led to conflicting orders by the Calcutta High Court and subsequent appeals, ultimately culminating in the affirmation of the Division Bench's decision by the Hon'ble Supreme Court.4. The appellant argued that the application before NCLT (CP No. 74/KB/2018) was filed by a competent shareholder under Sections 250 to 253 of the Companies Act, 2013, distinct from the earlier orders of the Calcutta High Court, and thus, NCLT erred in not considering the application for restoration.5. The judgment extensively examined the provisions of the Companies Act, 1956 and 2013, particularly Section 560, which empowers the Registrar to strike off a company's name for non-compliance. It noted the lack of action by the appellant to address the non-compliance issues before the striking off of the Company's name.6. The court emphasized that the appellant failed to demonstrate, as required by Section 252(3) of the Companies Act, 2013, that the Company was carrying on business or in operation at the time of striking off. While acknowledging the leniency often applied in restoration cases, the court upheld the NCLT's decision, considering the finality of the Supreme Court's ruling on the matter.7. Consequently, the appeal was dismissed, affirming the NCLT's order dated 14.12.2020, and highlighting the importance of statutory compliance and the limitations imposed by the relevant legal provisions in deciding restoration cases.