Are You a Victim of The MCA Action?
It is understandably quite unnerving if you are among one of those three lakh unfortunate Directors who lost their thriving careers due to strike off of their companies. Section 248 of the Companies Act, 2013, mandates that companies which default on financial compliances for three consecutive years should be struck off by the Registrar of Companies (ROC).
Worse was that you were removed as Director from all other active companies too and disqualified for 5 years from the day the company was struck off. This was a rather unjustified act by MCA as in most of the cases the directors were caught unawares, they had no inkling of what was coming their way!
Ways And Means To Remove Director Disqualification?
The government did realize that the companies which were struck off needed a viable solution at the earliest and as a result, opened a window temporarily, ‘Condonation of Delay’ in 2018. Many genuine companies were able to restore their status as ‘Active’ and the directors of such companies were successful in the removal of director disqualification.
Other companies who missed availing this window, took the route of NCLT for the revival of strike off company, making it easier for their directors to restore their career.
Still Looking For Restoration of DIN?
If your company has for some reason not taken any concrete step to become active once again, then the only option for you is to take individual and independent action. Companies Act 2013, surprisingly has no provision for relief for such Directors until and unless the company is revived and therefore, Directors like you are left helpless.
“If there is a problem then there has to be a solution, it is only a matter of being aware of which course to take!”
– Isha Malik (Company Secretary, MUDS Management Pvt. Ltd.)
Know Your Rights!
As per the provisions under Article 226 of the Indian Constitution, you can file a writ petition in the concerned High Court to seek relief. The most heartening news for you should be that since 2017 many of the aggrieved directors like you, have taken this legal recourse and have gained respite.
Delhi High Court in October 2017, has ordered stay on the matter, in the case of Srinivasan Sandilya & Others Vs Union of India. This gave a new lease of life to the concerned director’s career.
In a similar case, Bhagavan Das Dhananjaya Das Vs Union of India, the Madras High Court has called the order of the ROC illegal, arbitrary and devoid of merit and quashed it.
Many more such judgement from various High Courts of the country have given a new lease of life to many like you.
How To Draft A Writ Petition?
Being a legal process, it is essential that you seek the help of an experienced legal consulting firm which will take charge of the entire process. They will ensure that the matter is put up with details of all facts and figures.
The factors that stand in your favour are:
a.) Against the Principle of Natural Justice
Most of the struck off companies got no Notice, which is a mandatory clause, thus were caught unawares. The affected parties were not given a chance to clarify their stand or rectify the error, this is considered as against the principle of natural justice, which has been declared as a basic structure of the Indian Constitution by the Apex Court.
b.) Section 248’s Retrospective application
As the Companies Act, 2013, was implemented from 1 April 2014 and is a prospective one, therefore, applying any provision of it retrospectively is unjustified. The companies cannot be penalized for financial non-compliance in the year 2017. This amounted to flawed interpretation by the authorities.
c.) Against The Provisions of Companies Act, 1956
The private companies were governed by the Companies Act, 1956, (before the implementation of the Companies Act, 2013) which has no provision of disqualification of directors for non-compliance.
“At this juncture, the best option for the suffering directors like you is to take legal recourse and file a Writ Petition in the concerned High Court!”
– Kritika Chabbra (Market Analyst, MUDS Management Pvt. Ltd.
What Will a Legal Firm Do?
A consulting firm is equipped to deal with such matters in the shortest time with the best results as they have professionals on their team.
It will draft the writ petition, further file the matter in the High Court. The advocates will make appearances in the Court and accordingly plead the case. They will procure the final order from the High Court and submit it in the respective ROC’s office.
They will file the pending compliance related documents with the ROC and finally get the DIN activated and disqualification removed.
How To Know Which Firm Shall Be Most Competent?
You should shortlist a firm which has years of experience and an impressive track record in matters related to such cases. Only an experienced firm can do it in a time bound manner, bringing relief at the earliest.
An amateur company may mar your prospects of getting relief and would lead to a waste of time and money.
MUDS: The Most Reliable Consulting Firm!
An established consulting firm with tons of experience, MUDS has an impeccable record. It has helped 450+ directors to overcome their disqualification successfully and resurrect their career. MUDS has an exemplary team which is professionally capable and competent. With a pan India presence team, MUDS caters to clients from all corners of the country.
“If a problem is left unattended, it does not vanish, it turns into a CRISIS; keeping this in mind, you should act swiftly before it becomes too late! ”
-Shweta Gupta, Founder, and CEO, MUDS