CHAPTER XVIII

REMOVAL OF NAMES OF COMPANIES FROM THE REGISTER OF COMPANIES
 
 
248. Power of Registrar to remove name of company from register of companies.

(1) Where the Registrar has reasonable cause to believe that—
(a) a company has failed to commence its business within one year of its
incorporation;
(b) the subscribers to the memorandum have not paid the subscription which
they had undertaken to pay within a period of one hundred and eighty days from the
date of incorporation of a company and a declaration under sub-section (1) of section 11
to this effect has not been filed within one hundred and eighty days of its incorporation;
or
(c) a company is not carrying on any business or operation for a period of two
immediately preceding financial years and has not made any application within such
period for obtaining the status of a dormant company under section 455,
he shall send a notice to the company and all the directors of the company, of his intention
to remove the name of the company from the register of companies and requesting them to
send their representations along with copies of the relevant documents, if any, within a
period of thirty days from the date of the notice.
(2) Without prejudice to the provisions of sub-section (1), a company may, after
extinguishing all its liabilities, by a special resolution or consent of seventy-five per cent.
members in terms of paid-up share capital, file an application in the prescribed manner to the
Registrar for removing the name of the company from the register of companies on all or any
of the grounds specified in sub-section (1) and the Registrar shall, on receipt of such
application, cause a public notice to be issued in the prescribed manner:
Provided that in the case of a company regulated under a special Act, approval of the
regulatory body constituted or established under that Act shall also be obtained and enclosed
with the application.
(3) Nothing in sub-section (2) shall apply to a company registered under section 8.
(4) A notice issued under sub-section (1) or sub-section (2) shall be published in the
prescribed manner and also in the Official Gazette for the information of the general public.
(5) At the expiry of the time mentioned in the notice, the Registrar may, unless cause to
the contrary is shown by the company, strike off its name from the register of companies, and
shall publish notice thereof in the Official Gazette, and on the publication in the Official
Gazette of this notice, the company shall stand dissolved.
(6) The Registrar, before passing an order under sub-section (5), shall satisfy himself
that sufficient provision has been made for the realisation of all amount due to the company
and for the payment or discharge of its liabilities and obligations by the company within a
reasonable time and, if necessary, obtain necessary undertakings from the managing director,
director or other persons in charge of the management of the company:
Provided that notwithstanding the undertakings referred to in this sub-section, the
assets of the company shall be made available for the payment or discharge of all its liabilities
and obligations even after the date of the order removing the name of the company from the
register of companies.
(7) The liability, if any, of every director, manager or other officer who was exercising
any power of management, and of every member of the company dissolved under
sub-section (5), shall continue and may be enforced as if the company had not been dissolved.
(8) Nothing in this section shall affect the power of the Tribunal to wind up a company
the name of which has been struck off from the register of companies.
 
 
 
249.Restrictions on making application under section 248 in certain situations
 
(1) An application under sub-section (2) of section 248 on behalf of a company
shall not be made if, at any time in the previous three months, the company—
(a) has changed its name or shifted its registered office from one State to another;
(b) has made a disposal for value of property or rights held by it, immediately
before cesser of trade or otherwise carrying on of business, for the purpose of disposal
for gain in the normal course of trading or otherwise carrying on of business;
(c) has engaged in any other activity except the one which is necessary or expedient
for the purpose of making an application under that section, or deciding whether to do so
or concluding the affairs of the company, or complying with any statutory requirement;
(d) has made an application to the Tribunal for the sanctioning of a compromise
or arrangement and the matter has not been finally concluded; or
(e) is being wound up under Chapter XX, whether voluntarily or by the Tribunal.
(2) If a company files an application under sub-section (2) of section 248 in violation of
sub-section (1), it shall be punishable with fine which may extend to one lakh rupees.
(3) An application filed under sub-section (2) of section 248 shall be withdrawn by the
company or rejected by the Registrar as soon as conditions under sub-section (1) are brought
to his notice.
 
 
 
250.Effect of company notified as dissolved.

 Where a company stands dissolved under section 248, it shall on and from the
date mentioned in the notice under sub-section (5) of that section cease to operate as a
company and the Certificate of Incorporation issued to it shall be deemed to have been
cancelled from such date except for the purpose of realising the amount due to the company
and for the payment or discharge of the liabilities or obligations of the company.
 
 
 
251.Fraudulent application for removal of name.

(1) Where it is found that an application by a company under sub-section (2) of
section 248 has been made with the object of evading the liabilities of the company or with
the intention to deceive the creditors or to defraud any other persons, the persons in charge
of the management of the company shall, notwithstanding that the company has been
notified as dissolved—
(a) be jointly and severally liable to any person or persons who had incurred
loss or damage as a result of the company being notified as dissolved; and
(b) be punishable for fraud in the manner as provided in section 447.
(2) Without prejudice to the provisions contained in sub-section (1), the Registrar may
also recommend prosecution of the persons responsible for the filing of an application under
sub-section (2) of section 248.
 
 
 
252.Appeal to Tribunal.

(1) Any person aggrieved by an order of the Registrar, notifying a company as
dissolved under section 248, may file an appeal to the Tribunal within a period of three years
from the date of the order of the Registrar and if the Tribunal is of the opinion that the
removal of the name of the company from the register of companies is not justified in view of
the absence of any of the grounds on which the order was passed by the Registrar, it may
order restoration of the name of the company in the register of companies:
Provided that before passing any order under this section, the Tribunal shall give a
reasonable opportunity of making representations and of being heard to the Registrar, the
company and all the persons concerned :
Provided further that if the Registrar is satisfied, that the name of the company has
been struck off from the register of companies either inadvertently or on the basis of incorrect
information furnished by the company or its directors, which requires restoration in the
register of companies, he may within a period of three years from the date of passing of the
order dissolving the company under section 248, file an application before the Tribunal
seeking restoration of name of such company.
(2) A copy of the order passed by the Tribunal shall be filed by the company with the
Registrar within thirty days from the date of the order and on receipt of the order, the
Registrar shall cause the name of the company to be restored in the register of companies
and shall issue a fresh certificate of incorporation.
(3) If a company, or any member or creditor or workman thereof feels aggrieved by the
company having its name struck off from the register of companies, the Tribunal on an
application made by the company, member, creditor or workman before the expiry of twenty
years from the publication in the Official Gazette of the notice under sub-section (5) of
section 248 may, if satisfied that the company was, at the time of its name being struck off,
carrying on business or in operation or otherwise it is just that the name of the company be
restored to the register of companies, order the name of the company to be restored to the
register of companies, and the Tribunal may, by the order, give such other directions and
make such provisions as deemed 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.

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