Power Of NCLT To Restore Name Of Struck Off Company U/S 252 Of Companies Act Can't Be Exercised Suo Motu: NCLT New Delhi

The National Company Law Tribunal (NCLT), New Delhi Bench of Shri Manni Sankariah Shanmuga Sundaram (Hon'ble Member Judicial) and Shri Atul Chaturvedi (Hon'ble Member Technical) has held that the power to restore a name of the struck company under section 252 of the Companies Act, 2013 cannot be exercised suo moto. A company's name can be restored only on an application filed by the Companies, its members or creditors or workmen aggrieved by the order of striking off under Section 252(3) of the Companies Act. The present application has been filed seeking restoration of the Company Petition which was dismissed for non-prosecution. The Applicant submitted that the applicant was not aware of the said order of dismissal for non-prosecution and came to know about it very recently while checking the status of case on the web portal of this Tribunal. On becoming aware about the said order, the applicant has instantly moved the present application. Per contra, the Respondent submitted that despite the appointment of a valuer by this Hon'ble Tribunal to assess the company's financials, the Petitioners neither cooperated nor participated in the process, thereby obstructing an accurate assessment. Their persistent inaction and failure to engage with the valuer reflect a lack of seriousness in prosecuting the petition, and their explanation appears to be an unconvincing afterthought. It was further submitted that while numerous lawyers continued to appear before courts and this Hon'ble Tribunal remained functional, there was no valid reason for the Petitioners or their counsel to be casual in attending to the instant matter. The Tribunal observed that the power of the Tribunal to restore the name of a struck off company under section 252 of the Companies Act, cannot be exercised suo moto. It can only be exercised on an application filed by the Companies, its members or creditors or workmen aggrieved by the order of striking off under Section 252(3) of the Companies Act. In Chaitanya Manohar v. All Square Realtors India P. Ltd., the NCLT Bengaluru held that the petition under sections 397/398 for Oppression and Mismanagement of the Companies Act. 1956 cannot be maintained unless the company is first restored under section 252 of the Companies Act. It held that in the present case, the Applicant has failed to justify the delay or show diligence. The Applicant failed to cooperate with the valuer as well as failed to assist in assessing the financial status of the Respondent No. 1. This conduct shows lack of seriousness on their part thereby making the restoration appear merely an afterthought. Accordingly, the present application was dismissed. Case Title: Dhirendra Pratap Singh & Anr. Versus Dook Consulting Pvt. Ltd. & Ors. Case Number:CA/442/ND/2021 IN C.P. No. 54/ND/2014 Order Date: 15/07/2025 Click Here To Download Order/Judgement

Power Of NCLT To Restore Name Of Struck Off Company U/S 252 Of Companies Act Can't Be Exercised Suo Motu: NCLT New Delhi

Mohd Malik Chauhan

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