"1 NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH, NEW DELHI COMPANY APPEAL (AT) NO.56/2025 (Arising out of judgement and order dated 15.10.2024 passed by National Company Law Tribunal, Mumbai in Company Appeal No.140(MB)/2023). In the matter of: Tahir Vasanali Isani, 1st Floor, Manek Chambers, Above Angley Sports, Opposite Municipal Garden, Panaji, Goa 403001 Appellant Vs Registrar of Companies, Goa, Daman and Diu, Corporate Bhavan, EDC Complex, Plot No.21, Patto, Panaji, Goa 403001 Respondent For Appellant: Mr. Vaibhav Gaggar, Sr. Advocate, Mr. Anuj Tiwari, Mr. Aditya Shukla, Mr. Vaibhav Vats, Ms. Kaanchi Ahuja, Ms. Malavika Chandramouli, Advocates For Respondent:Ms Trupati Subhash Sharma, ROC-cum-OL, Goa. JUDGEMENT JUSTICE YOGESH KHANNA, MEMBER (JUDICIAL) This appeal is preferred against an impugned order dated 15.10.2024 passed by National Company Law Tribunal, Mumbai in Company Appeal No.140/MB/2023. The brief facts of case are as under:- a)on 19.08.2008 M/s Elegance Property Developers Pvt Ltd was incorporated under the Companies Act, 2013; 2 b) on 14.11.2008 Mr Tahir Vasanali Isani and Mr Malik Mansoorali Isani were appointed as Directors of the Company; c) till Financial year 2010-11 the company filed all its annual return and financial statement with the Registrar of Companies; d) the company failed to file its annual returns and financial statements with the Registrar of Companies for the FY 2011-12; e)on 04.07.2018 the Registrar of Companies issued a public notice in Form STK-5 inviting objections to the proposed strike off action. However, the Appellant could not notice the said public notice; f)on 05.09.2018 the Registrar of Companies struck off the Company’s name from the Register of Companies due to non-compliance and published the notice in form STK-7; g)on 08.09.2023 the appellant filed an appeal under Section 252(3) of the Companies Act, 2013 requesting the restoration of the company’s name to the Register of Companies; h)on 11.10.2023 the Registrar of Companies submitted a report to the Tribunal; k) on 15.10.2024 impugned order was passed; hence this appeal; hence this appeal. 2. The impugned order was passed on the ground the period of limitation for filing the appeal was three years in the present case and not twenty years as is provided under Section 252(3) of the Companies Act, 2013. Secondly the Ld. NCLT held there is no explanation as to why the annual and financial returns 3 were not filed with the ROC as well as in Income Tax Department and moreover the revenue of the company was Nil and as such there were valid and justified grounds for removal of the name of the company from the register maintained by the Registrar of Companies. The Ld. NCLT held that the financial statements of the company from financial year 2011-12 to 2017-18 shows nil revenue from operation in all these financial years and no business activities or operations were carried out by the company during this period i.e. for a period of two immediately preceding financial years at the relevant time. 3. The following paras of the impugned order are relevant to be noted:- 4.4 A close look at the above provisions of Section 252(1) and Section 252(3) of the Act reveals that an appeal under Section 252(1) can be filed by any aggrieved person within a period of three years from the date of order of the Registrar in case the company is dissolved by the Registrar of Companies concerned under Section 248 by initiating proceedings under Section 248(1) of the Act. However, when company gets its name struck off from the Register of Companies in the manner laid down under Section 248(2) of the Act, an application under Section 252(3) can be filed by the aggrieved company, member, creditor or workman before the expiry of twenty years from the publication of notice under Section 248(5) in the Official Gazette. ln other words, no appeal but only an application lies under Section 252(3) of the Act. 4.5-Thus, the remedy of appeal is provided under Section 252(1) to an aggrieved person when the company is struck off at the instance of the Registrar of Companies on failure of such company to comply with the requisite conditions laid down under Section 248(1) of the Act. However, application under provisions of Section 252(3) can be made by aggrieved company, member, etc., when the company is struck off voluntarily at the behest of the promoters/directors. Thus, it emerges that the provisions of Section 252(1) and Section 252(3) are distinct and mutually exclusive and operate under different set of circumstances. Section 252(3) is not intended to merely extend the period of limitation in cases which are otherwise covered under Section 252(1) but where the 4 aggrieved person failed to file the appeal within the prescribed period. 4.6 Adverting to the facts of the present case now, we find that what the Appellant has filed is an appeal under Section 252(3) whereas only an application and no appeal can be filed under the said provision. Moreover, the present case is not one where the name of the Company was struck off at the behest of its promoters/directors in the manner specified in Section 248(2) of the Act. As a matter of fact, this is a case where the name of the Company was struck off by the Respondent/RoC for non- compliance of the statutory requirements under Section 248(1) vide its order dated 05.09.2018. ln these circumstances, the instant appeal would in fact lie under Section 252(1) 'of the Act rather than Section 252(3) of the Act. 4.7 It is a well-settled legal proposition that quoting a wrong provision of law is not fatal to the appeal, if the power to pass such an order is available with the authorities/Court. Therefore, the present Appeal is treated as having been filed under Section 252(1 ) of the Act. However, we find that the Appeal has not been preferred within a period of three years from the date of order of the RoC, as per the limitation provided under Section 252(1) of the Act. The name of the Company was struck off from the Register of Companies maintained with the Respondent/RoC vide order dated 05.09.2018, whereas the Appellant filed the Appeal on 08.09.2023. In normal course, the Appellant could have filed the appeal at any time within the prescribed period of three years from the date of order of the ROC ending on 04.09.2021. 4.11 Further, it is noticed on perusal of the financial statements of the Company from FY 2011-12 to FY 2017-18 that it has shown 'nil' revenue from operations in all the above flnancial years which bears testimony to the fact that no business activities or operations were carried out by the Company throughout this period. Accordingly, the action of the Respondent/RoC in striking off the name of the Company on the ground that the Company had not been carrying on any business or operation for a period of two immediately preceding financial years at the relevant time and that it had not made any application within such period for obtaining the status of a dormant company under Section 455 is found to be in accordance with law. 4.12Mercly holding a property for years together does not constitute 'business'. Business refers to a real, substantial and 5 systematic or organised course of activity carried on by a person continuously by the application of his labour and skill with a view to earning an income or profit. ln the instant case, it is observed that purchase cost of the plot of land is shown at Rs.6,42,63,'120l- under the head \"lnventories\" on the \"Assets\" side while same amount of Rs.6,42,63,120/- appears as \"Long term borrowings\" on the \"Liabilities\" side in the audited Balance Sheet of the Company representing unsecured loans purportedly made by the Directors for the purpose of acquiring the property in the name of the Company. This shows that the Directors have their separate and independent businesses/sources of income and they could very well have bought the said property in their own names. However, it is felt that instead of doing so, they chose to form this Company only for the purpose of holding this property which by no stretch of imagination can be equated with \"carrying on any business or operation\" within the - meaning of Section 2a8(1)(c) of the Act. 4.13 Further, although the financial statements of the Company show receipt of Rs.6,22,63,1201- from Sh. Tahir lsani and Rs.20,00,000/- from Sh. Mansoor Ali Isani copies of bank accounts of Sh Tahir Isani reveal only debits of Rs.4,05,00,000/- (Rs.3,50,00,000 plus Rs.55,00,000) towards Pay Orders/DDs issued towards purchase of property while a sum of Rs.2,00,00,0001 was transferred from the Current Account of a -connected entity, namely, Elegance Properties Pvt. Ltd. whose name surprisingly does not appear in the list of unsecured creditors under the head \"Long-term borrowings\" in the audited financial statements of the Company. lt is also worth noting that even the name of Elegance Properties Pvt. Ltd. has been struck off from the Register of Companies maintained by the Respondent/RoC vide the same Public Notice dated 05.09.2018 (Form STK-7) published in the Official Gazette at Sr. No.37. AII this casts a shadow of serious doubt over the sources of funds used - for purchasing the property. This also explains why Annual Returns and financial statements of the Company were not filed with the Respondent/RoC as well as the Income tax Department in the normal course so as to escape scrutiny and investigation of sources of investment in property by the tax authorities. 4. We have heard the arguments advanced by both the counsels. Coming to the limitation aspect of filing of an appeal to the Tribunal, we would find under 6 sub-section (1) of Section 252 of the Companies Act, 2013 any person aggrieved may file an appeal against an order of the Registrar within a period of three years before this Tribunal and whereas under sub-section (3) of Section 252 of the Companies Act, 2013 only a company, member, a creditor or a workman, if feel aggrieved, by the striking off name of the company from the register of Registrar of Companies, can make an application before the Tribunal before the expiry of twenty years from the date of publication in the Official Gazette under sub- section (5) of Section 248 and the Ld. Tribunal may, if satisfied, the company was, at the time of its name being struck off was carrying on business or was in operation or otherwise it is just that the name of the company be restored to the register of companies, shall order the name of the company to be restored to the Register of Companies, and the Tribunal may, by an order, give such other directions and make such provisions as may deem just for placing the company and all other persons in the same position as nearly as may be as if the name of the company had not been struck off from the Register of Companies. 5. In the present case, admittedly, the application for restoration of the name of the company was moved by a shareholder and hence could have filed an application within twenty years of the date of order of the Registrar. In Daksha Atul Desai Vs ROC Mumbai, it was held: 6. We are of the considered view no distinction is given under Section 252 of the Act as to if Section 252(1) shall apply only in cases where the name of the company is struck off by the Registrar of the Companies and Section 252(3) would apply only where the name of the company is voluntarily got struck off by the company itself. In fact, Section 252 (supra) only speaks of striking off the name under Section 248 without making any distinction whether 252(1) shall be applicable to 7 Section 248(1) or Section 252(3) would be applicable to Section 248(2) of the Companies Act, 2013. 6. Thus, in view of the legal position above, we are of the considered opinion the view taken by the Ld. NCLT is not correct and since the appeal in the present case was filed by shareholder viz. a member, the limitation as is given under Section 252(3) of the Companies Act, 2013 shall apply. 7. Thus on first limb we are of the considered opinion the appeal was filed within limitation before the Ld. NCLT. Now we come to the second limb of argument if it is just and equitable for us to revive the company. Admittedly the company owns a 36,022 sq mtrs land parcel in South Goa. The said land parcel was bought by the company on 24th November, 2008 for consideration of INR 6,05,00,000/-. The company intends to initiate and complete a real estate project over the said land which is evident from the main object of the Company as mentioned in its Memorandum of Association, reproduced as follows:- “To carry on business of developing, improving, building, refurbishing, renovating, operating, establishing, managing directly or indirectly any construction facilities, real estate projects, including port, roads, dams, airports, multiplexes, auditoriums, schools, colleges, educational institutions, hospitals, convention centers, leisure resorts.” 8. Further, admittedly the company is not a shell company. For that matter, the Company did file its financial statement from its incorporation till 2012. The Respondent has struck off the company for non-filing of the financial statement 2012 onwards. The appellant has also furnished a Chartered Accountant Certificate and Extracts of Bank Statement which shows the company was never used to deposit cash during demonetization. The appellant has also furnished 8 affidavit stating the company has not deposited any cash during demonitisation period and no prosecution is pending against the company. 8A. In DD Finance and Holdings P Ltd Vs Registrar of Companies, NCT of Delhi and Haryana (2024) 243 Comp Cas 546 it was held:- 14. Now the term otherwise just and equitable under Section 252(3) of the Companies Act, 2013 envisage revival/restoration of the company on the rolls of ROC if it is not a shell company or a company dealing with siphoning funds or advancing loan to sister concern. Rather they have a fixed substantial assets worth crores. The company is still sole absolute owner and in possession of the property situated at Bhakti Bhavan Estate, Kulri, Mussoorie and if the company's name is not restored then, of course, it would result to an irreparable loss and prejudice to the appellant and the fixed assets of company would be a deadlock and would result in wastage of property which is, of course, contrary to the public policy. Admittedly the property is free from all encumbrances. 19. In M/s Durga Builders (P) Ltd Vs ROC; Company Appeal (AT) No.154 of 2021 this Tribunal held:- \"10. After hearing the parties and going through the pleadings made on behalf of the parties, we observe that the Appellant Company is in litigation therefore, the Company has not filed the financial statements and also without giving opportunity of hearing, the Respondent No. 1/Registrar of Companies struck off the name of the Appellant Company's from the Register maintained by him, but in view of the fact and also the Bank Statements of the Appellant Company from 2015 -2018 shows 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. Hence, we are of the view that the order passed by the National Company Law Tribunal (Court V, New Delhi) as well as Registrar of Companies, NCT Delhi & Haryana is not sustainable in law.\" 20. In `Dashmesh Impex Pvt. Ltd. & Ors. Vs ROC: Company Appeal (AT)No.116/2021 this Tribunal held as follows: 9 \"5. After hearing the parties, going through the pleadings made on behalf of the parties and in view of the fact that the financial statements 2016-2017, 2017-2018, 2018- 2019, 2019-2020 and Income Tax Return of the Appellant Company shows 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. Hence, we are of the view that the order passed by the NCLT, New Delhi as well as RoC, NCT Delhi & Haryana is not sustainable in law.\" 21. In Basant Kumar Berlia & Ors Vs. ROC; Company Appeal (AT) No.171 of 2018 this Tribunal held:- \"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 2014, 2015 and 2016 which they could not file with ROC as the company name was struck off. Seeing the balance sheets and the company's huge investment which the company is having since 2011 and there are large amount of the loan and advances, it is possible that creditors could also be aggrieved persons, feeling aggrieved of company's name being struck off, may file an application for restoration of company's name, if its name is not restored. Thus, it would be just and equitable to restore the name of the company to even avoid further legal proceedings.\" 10 9. Thus from the above facts, we find the appellant company owns a substantial valued property as is stated in para 7 above and in case the company’s name is not restored, it would then result in an irreparable loss and injury to the appellant as the fixed asset of the company worth Rs.6 crores in the year 2008 itself, would become a deadlock and be a complete waste, which shall, of course, would be contrary to the public policy, especially when such property is free from all encumbrances. 10. For the reasons aforesaid we find it just and equitable to restore the name of the appellant company to the record of ROC and thus we set aside the impugned order dated 15.10.2024 passed by the Ld. NCLT and direct the ROC concerned to restore the name of the company to the Register of Companies subject to the following compliances: i) Appellant Company shall pay costs of Rs.2,00,000/- (Rupees Two Lakhs) to the Registrar of Companies concerned within eight weeks from the passing of this Judgement; ii) the company shall file all its annual returns and balances sheets within four weeks and shall also pay all requisite charges/fee, as applicable. 11. Inspite of present order, the ROC shall be free to take any other steps, punitive or otherwise, under the Act for non-filing/late filing of statutory returns/documents against the Company and Directors. 11 12. The instant Appeal is allowed to the above extent. Pending applications are also disposed of. (Justice Yogesh Khanna) Member (Judicial) (Mr Indevar Pandey) Member (Technical) Dated:11-8-2025 bm "