Case Note & Summary
The appeal was filed by M/s. Espin Infosystems Private Limited against an order of the National Company Law Tribunal (NCLT) in CP No. 1405/2019, which dismissed the appellant's plea under Section 252(3) of the Companies Act, 2013, challenging the striking off of its name by the Registrar of Companies (RoC) on 09.08.2018. The appellant company, registered on 01.04.2004 and engaged in IT enabled services, had filed its returns up to the financial year 2012-2013 but failed to do so thereafter inadvertently. Following a show cause notice issued by the RoC on 04.06.2018, the company’s name was struck off. The NCLT dismissed the appellant's appeal on the grounds of insufficient documentation to prove operational status. The appellant contended that it had provided financial statements for the years 2014-2015 to 2017-2018, indicating annual revenue of approximately Rs. 25-26 lakhs, and income tax returns for the assessment year 2018-2019. The Income Tax Department acknowledged the filing of these returns but noted that the taxable income was low. Upon reviewing the materials, the NCLAT determined that the NCLT had not adequately considered the evidence of the company's operational status, leading to the decision to set aside the NCLT's order and allow the appeal, thereby restoring the company's name to the register.
Headnote
A) Company Law - Striking Off Company Name - Operational Status - Companies Act, 2013, Section 252 - The appellant challenged the NCLT's dismissal of its appeal against the striking off of its name by the Registrar of Companies, arguing that it had produced sufficient evidence of operational status through financial statements and income tax returns. The NCLAT found that the NCLT did not adequately appreciate the evidence presented, leading to the decision to set aside the impugned order and allow the appeal. Held that the company was operational and deserved restoration (Paras 1-6).
Issue of Consideration
Whether the appellant company was operational and should have its name restored to the register.
Final Decision
The NCLAT set aside the NCLT's order and allowed the appeal, restoring the company's name to the register.
Law Points
- Companies Act
- operational status
- striking off company name
- financial statements
- income tax returns
