Overview on Revival of Struck Off Companies

Strike off means temporary closure of the Company or removal of the name of the Company from the Register of Company by the Registrar following the provisions of the Companies Act, 2013. It is a substitute for winding up of the Company, and in this case, the Company can get revived for a period of twenty years from the date of strike-off. The appeal or application can be filed by the Registrar, any person aggrieved by order of the Registrar or by Company, or by member or creditor or workman. 

The member, creditor or workman of a company can file a petition for Revival of the Company before the expiry of 20 years of striking off from notification in the official gazette under section 252(1), and others can file a petition under section 252(3) within three years from the publication of notification in the official gazette. The demand draft of Rs. 1000/- should be filed with the petition as fees. 

It is important that the appeal has to be filed within three years of the date of order of the Registrar of Company in case of compulsory striking off by the Registrar and the limitation period is twenty years in case of voluntary striking off. It is on condition that the application shall be made before the expiry of twenty years with respect to striking off the Company's name from the date of publication of notice in the Official Gazette.

The grounds for Revival of Struck off Companies

The grounds on which NCLT does the Revival of Companies are as follows: -

• The Company holds any immovable property.
• The Company, apart from the Registrar of Companies, has complied with the GST, Income tax, Provident Fund, and such authorities, 
• In case there is evidence stating that the Company has an ongoing business as active transactions in the bank statements of the Company.
• The Company is renewing any license on an annual basis and other documents depending upon the circumstances.
• Any document that shows that the Company is ongoing or active and it will be in the public interest to revive the Company.

Benefits are given by the Companies Fresh Start Scheme- 2020 

There are a number of benefits that the revival of stuck off the Company would enjoy, such as: -

• To recover their overdue sum with interest, creditors of such Companies may start an action.
• The Company can be enforced for discharging the Company's liabilities/ obligations, and the liability of every director & officer shall continue.
• If any Company has not filed annual returns or financial statements for any continuous period of three fiscal years, it may disqualify the Directors of such Companies.
• The Registrar may also recommend the prosecutions of the persons responsible for the non-filing of the documents and returns.
• Moreover, five years from the date on which the said Company fails to do so, this disqualification will be the outcome with ineligibility to be appointed in another company or re-appointed.
• The office of the director will/must become vacant in all the companies leading to such disqualification as mentioned above, wherever he is holding the director's post.
• Such a director shall be required to inform the Company concerned about his disqualification even when the disqualification gets removed (under sub-section (2) of section 164) before he is re-appointed or appointed.
• The following benefits can be availed if the Promoter Shareholder opt for the revival of the Company's name by taking instant action within the accord of this scheme: -

1. Such a company can now opt for filling out overdue returns and documents only with a nominal fee of Rs. 300/-, 400/-, 500/- or 600/- which has not filed returns for preceding years. The fees will depend on the case may be and can get the waiver, and additional business fees can commence their actions if so anticipated.
2. For imposing penalties on accounts of delay associated with specified forms and returns, no proceedings against the "Company and its Officers" shall be initiated if overdue documents must be filed within the overall occupancy of the scheme.
3. If proceedings or prosecution initiated shall be withdrawn if the scheme's necessities will be obeyed in time.

The documents required for the revival of struck off companies

The application to restore the name of the Company shall be filed, stating that the Company was actually in operations (recommendatory) with the following documents:

• The certificate of incorporation
• The MOA
• The copy of the audited financial statement from the date of strike off
• Bank statements
• The striking off order of the Registrar of Company 
• Affidavit verifying the petition
• The copy of the board resolution authorizing the filing of the petition
• PAN
• Income Tax returns
• All the property documents if the property is owned by the Company
• Memorandum of Appearance or Vakalatnama
• Any other documents which are required.

Procedure related to the revival of struck off Companies

The process of revival of struck off companies is as follows:

1. Filing of the application/petition/appeal: An appeal or application must be made in the format of Form NCLT-9 along with a demand draft of Rs. 1000 in favour of Pay and Accounts Officer, Ministry of Corporate Affairs (MCA).
2. Serving copy of petition: Not less than fourteen days before the date fixed for hearing of the application, a copy of the petition should be served to the Registrar of Companies and such other persons as the Tribunal may allow.
3. Trails And Hearing by Tribunal: During the trials and hearings, the Tribunal shall hear the Petitioner and Respondent (ROC- Registrar of Company). It will also take note of the objections received during the proposed dates of the hearing. If it is satisfied after hearing both sides, then it can order the revival of the name of the Company in the record of the ROC.
4. Order of Tribunal: The Tribunal makes an order for restoring the name of the Company in the Register of companies. The order directs the followings:

• Within 30 days from the order, the applicant should deliver a certified copy of such order to the ROC.
• The Registrar will publish the copy of the order after receiving it in the official gazette in the name and seal of the Company.
• Until and unless the Tribunal directs otherwise, the applicant must pay the costs of the appeal or application to the Registrar.
• The Company should comply with the requirements of the Companies Act, 2013 and file pending annual returns and financial statements with the Registrar. They should abide by all the rules made within such time as may be directed by the Tribunal.

5. Abiding ROC Orders for Filing: Within thirty days from the date of order, the Company should file a copy of such order in Form 'INC-28' with the Registrar of Companies.
6. Publication of order: After receiving the certified copy of the order, the Registrar will do the needful consideration and publish the order in the Official Gazette with the name and seal of the Company.
7. Filing of pending documents with ROC: The Company should comply with the requirements of the Companies Act, 2013 and file pending annual returns and financial statements with the Registrar. They should abide by all the rules made thereunder within such time as may be directed by the Tribunal.

Revival of Struck Off Companies by Companies Fresh Start Scheme, 2020 (CFSS-2020)

Following the power under Section 248(1)(c) to curb the operations of shells and increase the transparency of Companies, the Registrar of Companies struck off many Companies in 2017, 2018, and 2019. Accordingly, having jurisdictions to date, there have been three tranches of striking off done by the Registrar of Companies (ROC).

Everyone was facing difficulty in reviving their Companies before this date, on account of hefty penalties, elaborated and included in filing annual returns of the Company. However, additional fees on filing yearly returns have been waived off by the government amid widespread Novel Corona Virus after the introduction of the Companies Fresh Start Scheme, 2020 (CFSS-2020). Therefore, many people again have started giving thought to in receipt of getting their Companies revived. (Under Section 252 of the Companies Act, 2013, read with Rule 87A of the National Company Law Tribunal (Amendment) Rules, 2017). Company Fresh Start Scheme (CFSS-2020) covers a golden opportunity to revive your Company without connecting any in-exorbitant or heavy penalties or fees.

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