Power of Office to cancel registration

Power of Office to cancel registration

(1) The Office may cancel the registration of a company in the following circumstance:

• (a) If the promoter of the company makes an application, showing a reason for the failure to commence the business of the company, and accompanied by the prescribed fees, for the cancellation of the registration of the company:

• (b) If the company is in default in submitting to the Office the returns as referred to in Section 80 or fails to pay the fine as referred too in Section 81 for three consecutive financial years; or

• (c) If based on the proofs received in the course of administration of the company, the Office has a reasonable ground to believe that the company is not carrying on its business or the company is not in operation.

(2) If it is required to cancel the registration of any company pursuant to Sub section (1), the Office shall, prior to the cancellation of registration, give a notice, accompanied by the reason for such registration, to the concerned company.

(3) while sending a notice to a company pursuant to Sub-section (2), the notice shall be sent to the company at its registered office or to any office or such company if the address of the registered office of such company is not registered with the Office or if the office of the company is not located at the address registered and to the memorandum of association of the company if even address of such officer is not available to the Office or is not known.

(4) A notice given pursuant to Sub-section (2) shall also be published in a national daily newspaper, as per necessity.

(5) If the company fails to make an application, specifying the reasons that the registration of the company should not be canceled, within two months from the date of receipt by the company of a notice pursuant to Sub-section (2) or, despite the making of such application, the reasons specified are not found reasonable, the registration of such company may be canceled.

(6) If the registration of a company is canceled pursuant to Subsection (5), information thereof shall be given to the concerned directors and shall also be published in a national daily newspaper.

(7) If the registration of a company is canceled pursuant to Subsection (5), if there exists any kind of liability of the company, the liability of the officer or shareholder of the company shall continue to exist;; and nothing contained in this Section shall be deemed to bar the instituting of necessary legal action against them to have such liability fulfilled.

(8) The assets, rights, benefits or liabilities held in the name of the company at the time of cancellation of its registration pursuant to Subsection (5) shall devolve on its shareholders in the proportion of their shareholding.

              Provided, however, that the title and ownership of any property which has been held by the company as a trustee in favor of any other person shall devolve on the shareholders.

(9) If any debt to be repaid by or any liability to be performed/discharged by the company of which registration has been canceled pursuant to this Section cannot be settled from the assets, rights or benefits devolved on the shareholders pursuant to Sub-section (8), the shareholders, directors or officers who were involved in the management of such company and responsible for giving rise to the situation as referred to in Sub-section (1) shall personally bear such remaining loan or liability.

(10) A company of which registration is canceled pursuant to this Section shall not be allowed to carry on any business by the name of the same company.

(11) Following the cancellation of registration of any company pursuant to this Section, the Office shall return to the shareholders only such property, if any, remaining after deducting therefrom the expenses incurred in the cancellation of the registration of that company.