Name of Company cannot be Struck off when Company has Substantial movables as well as Immovable Assets: NCLAT [Read Order]
Name of Company – Struck of – Substantial movables – Immovable Assets – NCLAT – taxscan
Name of Company – Struck of – Substantial movables – Immovable Assets – NCLAT – taxscan
The National Company Law Appellate Tribunal (NCLAT) has held that the name of the company cannot be struck off when the company has substantial movables as well as immovable assets.
Bharat Goyal, the appellant challenged the order passed by the National Company Law Tribunal (Mumbai Bench) whereby and whereunder appeal filed by the Appellant for restoration of the name of the Company in the Register maintained by the Registrar of Companies (RoC), Mumbai was dismissed by the Tribunal.
The Appellant Company was incorporated as a Private Limited Company and was registered with the ROC Mumbai. The authorized share capital of the Company ofRs.1,00,000/- is divided into 10000 equity shares of Rs'10/- each. These shares were issued and subscribed, as per the provisions of the Companies Act, of 1965. Paid Up Capital of the Company is Rs.1,00,000/-.
The business of the Appellant company was going on smoothly and no legal omission or commission was committed by the Appellant till the year in dispute. The main Director of the Appellant Company Shri Govind Lal Ganesh Lal Govil expired on 08.12.2017. As a result, the activities of the Appellant Company came to stand still for a short period.
Thereafter, the Secretary of the Appellant Company was hospitalized on 03.03.2018, because of a certain health issue and she was discharged from the hospital on 10.03.2018, due to which filing of Annual Returns for the Financial Years 2015-16 and 2016-17 was due.
The ROC, Mumbai published the names of the Corporate Entities, whose names were struck off from the list of Active Companies. Thereafter, the Appellant filed an appeal against the order of the Registrar of Companies for restoration of the name of the Company under Section 252 of the Companies Act, 2013 , which was challenged on Appeal.
It was submitted that the Company has failed to file its Financial Statements and Annual Returns for the Financial Years 201516 and 2016-17 i.e. two years. Further submitted that the reason for non-filing of Annual Returns for the Financial Years 2015-16 and 2016-17 was due to inadvertence. Further, submitted that the company is active and carrying on day-to-day business from its incorporation.
A two-member bench comprising Justice Anant Bijay Singh, Member (Judicial) and Naresh Salecha, Member (Technical) observed that the Appellant Company is having substantial movable as well as immovable assets, therefore, it cannot be said that the Appellant Company is not carrying on any business or operations.
While allowing the appeal, the Authority set aside the impugned order.
To Read the full text of the Order CLICK HERE
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