TaxTMI 
TaxTMI 
2019 (4) TMI 738
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....irectors in the Company and both of them are shareholders and each shareholder is having 5000 equity shares. As per Memorandum of Association, the main object, the company is engaged in the business of iron and steel including sponge iron, pig iron, hot rolling and cold rolling steel strips and objects incident or ancillary to the attainment of the main object is real estate development and construction. 3. 2nd respondent, since its incorporation in 2008, has always been regular in filing its financial statements and annual returns with the Registrar of Companies. The last financial year for which the filing was done, was 31.03.2013. Appellants stated that due to some internal problems the statutory returns of the 2nd respondent after 31.03.2013 could not be filed before the Registrar of Companies, West Bengal and therefore, 2nd respondent had not applied under Section 455 of the Companies Act, 2013 to take the benefit of being a Dormant Company. Appellants state that the company is still carrying on its business. Appellant did not take steps to file the annual returns and the financial statements with ROC due to internal problems, therefore, the name of the company was struck o....
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....h the parties the NCLT passed the impugned order dated 6th April, 2018. The relevant portion of the impugned order is as under:- "19.xxxxxx It is significant to note that the provisional allotment was on 12.03.2012 and the company filed it balance sheets and annual return upto 2013 and thereafter the company did not file any balance sheets or annual return. If the petitioner is really interested to do business upon getting provisional allotment worth Rs. 59 crores, certainly they would have vigilant in processing the allotment and would have fulfilled the terms of allotment. From the data available it is understood that they have committed breach of terms of allotment and committed default in non-filing of statutory returns which they are duty bound to submit with the office of the ROC under the Companies Act, 2013. From the above said discussion we can come to a legitimate conclusion that the appellant company is a sham company ever engaged in any business from the time of inception or it was in operation as alleged. We also found no valid reason for restoring a company of this nature. The appeal is, therefore, liable to be dismissed. 20. In the result, this appe....
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....n dismissing the appeal/company petition thereby destroying the valuable right which had accrued in favour of the company under the provisional letter of allotment dated March 12, 2012 issued by Luxmi Township Limited. 13. Appellant stated that NCLT erred in holding that 2nd respondent has no valid reason for not striking off the name of company. 14. Appellants stated that balance sheet for the financial years from 2014 to 2016 could not be filed with the ROC but the said financial statements was always prepared in time and was part of the company petition and also submitted before the Income Tax. 15. Appellant stated that the NCLT has wrongly held the company was not in business of trading, there was no revenue generation for some length of time and this was because the company was focused on real estate development projects. 16. Affidavit-in-opposition has been filed on behalf of Registrar of Companies through Mr. N. Chinnachamy, Dy. Registrar of Companies, West Bengal. 1st respondent stated that under Section 248 of the Companies Act, 2013 the Registrar can strike off the name of a company from his register after complying with certain formalities as provided in the ....
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....rnal disputes between both the directors and when the disputes were resolved, it was brought to their notice about non-filing of statutory returns with the ROC. When they approach the ROC they came to know the fact of striking off the name of the company and they filed the appeal/petition before the NCLT. Appellant stated that non filing of statutory returns and balance sheets is neither deliberate nor intentional on the part of the company. 22. On the other hand the 1st respondent had stated in its affidavit in opposition that Section 248 of the Companies Act, 2013 empowers the Registrar of Companies that he can strike off the name of a Company from the register after complying with certain formalities as provided by the said Section when he has reasonable cause to believe that the company is not carrying on business or in operation. 1st Respondent stated that he has reasonable cause to believe that the company was not carrying in business or in operation for the last three years. 23. We have perused the record and noted that the 2nd Respondent has not filed the statutory returns after the year 2013. 1st Respondent vide its Form No.STK-5, Public Notice, dated 07.04.2017 (Pag....
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....owledgement have been filed and copies of the income tax returns have not been filed. Further the provisional allotment is based on a grant of lease for 99 years upon fulfilling certain clauses contained in the lease deed. No such lease deed produced for the perusal of this Appellate Tribunal. 25. We have also perused the directors' report at Page 97 for the FY 2013-14. The said directors' report has been signed by both the directors. It is clearly mentioned in the directors' report under heading "Business Operations"- No business operation was carried during the previous year 2013-14. Your directors are hopeful to commence the business operation very soon. This is precisely the position which is envisaged by law under Section 455 of the Companies Ac, 2013 for availing the benefit of being a dormant company. No efforts have been made by 2nd respondent to take the benefit of this provision. Similarly, for the Directors' report for the years ended 31st March, 2015 and 31st March, 2016 it is mentioned that "No revenue generating activities took place during the year." 26. We have also perused the copies of income tax return acknowledgement filed by the appellants for the default....
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....) of the Companies Act, 2013 on the basis of which the appellants are seeking relief for restoration of the name of company which has been struck. 28. Further while arriving at the conclusion to struck off the name of the 2nd respondent from the register of companies, the ROC has to act as per Section 248(6) of the Companies Act, 2013. Section 248(6) of the Companies Act, 2013 states as under:- "(6) The Registrar, before passing an order under sub-section (5), shall satisfy himself that sufficient provision has been made for the realisation of all amount due to the company and for the payment or discharge of its liabilities and obligations by the company within a reasonable time and, if necessary, obtain necessary undertakings from the managing director, director or other persons in charge of the management of the company. Provided that notwithstanding the undertakings referred to in this sub-section, the assets of the company shall be made available for the payment of discharge of all its liabilities and obligations even after the date of the order removing the name of the company from the register of companies." As per the above Section the Registrar, befo....
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....om other persons. In the light of this we do not agree with the observations of the Learned NCLT that the 2nd respondent is a sham company. 30. We have noted that when the 1st respondent had issued Public Notice dated 7.4.2017 (Page 85) intimating the companies, including 2nd respondent, that their names of the companies would be struck off under Section 248(1) of Act, 2nd respondent was given 30 days' time from the date of publication of notice to send their objection to the ROC. 2nd respondent did not respond to the said notice. Thereafter, 1st respondent vide notice dated 30.6.2017 (Page87) struck off the name of the 2nd respondent from the register of companies. Now these appellants had filed petition/appeal before the NCLT stating that the company is going concern and they have valuable assets, long terms loan and advances and filed petition/appeal under Section 252(3) of the Act. If the appellants had pleaded it before the ROC, then the ROC before striking off the name of the company under Section 248(5), would have considered the pleas now taken under Section 248(6) of the Companies Act, 2013. The appellants have now filed with this appeal the Balance Sheets for the years....