DG Resources Ltd v The Commissioners for HMRC

The court considered two applications by DG Resources Ltd: an injunction to restrain HMRC from advertising a winding-up petition and an application to strike out that petition. Key legal principles concerned the effect of amendments to the Companies Act 2006 (in particular s.86), the Registered Office Address (Rectification of Register) Regulations 2024 (the "Regulations") and the permitted methods of service in paragraph 2 of Schedule 4 to the Insolvency (England and Wales) Rules 2016 (the "Rules").

The judge held that Companies House had validly changed the company’s registered office to a default address under the Regulations after issuing a Regulation 6 notice which the company did not answer. Service of the petition at the default registered office was valid under paragraph 2(1)(c) (acceptance by a person authorised to accept service) and, in any event, would have been effective under paragraph 2(2). The company’s allegations that HMRC had colluded with Companies House or deliberately withheld the petition were dismissed as unsupported by evidence. The company failed to establish a genuine and substantial cross-claim in the form of a tax rebate or an assigned claim sufficient to equal or exceed the petition debt. Accordingly the interim injunction was discharged and the petition was not struck out.

Background and parties: DG Resources Ltd (the applicant) faced a winding-up petition presented by HMRC for unpaid tax of £1,104,015.14. The company applied for an injunction to restrain advertisement of the petition and, later, applied to strike out the petition. The company also relied on two principal defences: that it was entitled to a tax rebate due to trading losses (a cross-claim) and that it had acquired assigned claims against HMRC exceeding the petition debt.

Procedural posture: First instance in the Chancery Division, Insolvency and Companies Court. The petition had been presented on 11 December 2024 and advertised in the London Gazette on 24 January 2025 after service. The company had not responded to a Companies House Regulation 6 notice and the registered office was changed to a default address on 4 December 2024.

Issues framed by the court:

• whether the petition had been validly served under the Rules in the context of the changed registered office under the Regulations and Companies Act 2006;
• whether the company had a genuine and substantial cross-claim (a tax rebate or assigned claims) that equalled or exceeded the petition debt such that the petition should be dismissed;
• whether allegations that HMRC had improperly colluded with Companies House or deliberately withheld the petition were proven.

Court’s reasoning and findings:

• The court analysed the effect of the ECCT amendments to the Companies Act 2006 (notably s.86), the Regulations (including Regulations 4, 6, 7, 15 and 18) and the service provisions in paragraph 2 of Schedule 4 to the Insolvency Rules. The Regulations permit Companies House to change a company’s registered office to a default address where the company fails to demonstrate an "appropriate address"; service at that registered office remains governed by section 1139 and the Rules.
• The petition had been handed to a receptionist at the default address who stated she was authorised to accept service. That satisfied paragraph 2(1)(c) of Schedule 4; alternatively, the deposit and handing to a person attending the office would satisfy paragraph 2(2). The company’s restrictive reading of "person" (as restricted to directors/officers/employees) was rejected as inconsistent with the Rules’ language and purpose.
• The company’s allegations of collusion with Companies House, or deliberate withholding of the petition by HMRC to frustrate an injunction, were dismissed for want of evidence; the company had not put the allegation into evidence nor sought cross-examination, and the chronology rebutted the allegation.
• The claimed rebate and asserted assigned claims were unsupported: the CT600 and other material were incomplete and there was no evidence of prior corporation tax paid or computations to establish a substantial cross-claim. The company therefore failed to show a cross-claim equalling or exceeding the petition debt.

Result: the interim injunction restraining advertisement was discharged; the petition stood as validly served and was not struck out. The judge declined to exercise the case management power to strike the petition in the circumstances described and invited the parties to agree an order.

This is a first-instance decision. The court dismissed the company’s applications: the interim injunction restraining advertisement is discharged and the Petition is not struck out. The petition was validly served at the registered office shown on the Companies House register (the default address) in accordance with paragraph 2(1)(c) of Schedule 4 to the Insolvency Rules (and in any event paragraph 2(2)), and the company failed to establish a genuine and substantial cross-claim or to provide evidence of misconduct by HMRC or a Regulation 4 application to Companies House.