Removal of DIN Disqualification
Simranjeet Singh
Writ Petition For Removal Of DirectorDisqualification
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 removal of director disqualification.
Other companies who missed availing this window, took the route of NCLT for 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. The only option for restoration of DIN or removal of Director Disqualification is to file writ petition in High Court.
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.
Key Points to be pleaded in Writ Petition
Being a legal process, it is essential that you seek 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.
Adv. Simranjeet Singh
Simranjeet Singh & Associates
C – 523, LGF, Chittaranjan Park,
9654871449
011 - 40190343
*The content of this article is intended to provide a general guide to the subject matter. Specialist professional advice should be sought about your specific circumstances. The views expressed in this article are solely of the authors of this article.
Simranjeet Singh & Associates
C - 523, LGF, Chittaranjan Park,
New Delhi -110019
pramod ladda
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Deepak Singhal
we have also obtained from many High Courts Like Delhi, Jaipur, Chandigarh But Mumbai High court is not granting the order
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CS Deepak Singhal
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Priyanka Mundra
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Deepak Singhal
Please confirm on that basis whether the DIn of Director was activated
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Deepak Singhal
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Deepak Singhal
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