Agarwal Fin-Lease And Investment Private Limited vs Registrar of Companies

Virendra Kumar Gupta, Member (Technical)

The instant application has been filed in the first stage of the proceedings under Section 230(1) read with Section 232(1) of the Companies Act, 2013 (“Act”) for orders and directions with regard to meetings of Shareholders and Creditors in connection with the Composite Scheme of Arrangement between Agarwal Fin-Lease and Investment Private Limited (‘Transferor Company No. 1), Chinhat Land and Finance Private Limited (‘Transferor Company No. 2), Enembee Engineers Private Limited (‘Transferor Company No. 3), Uma Sales Private Limited (‘Transferor Company No. 4), Vinamra Fin-Lease and Investment Private Limited (‘Transferor Company No. 5), Vibhu Enterprises Private Limited (‘Transferor Company No. 6’ / ‘Demerged Company’) and Technical Associates Limited (‘Transferee Company’/ ‘Resulting Company’) and their respective Shareholders and Creditors (“Scheme” or “Composite Scheme”) . The Composite Scheme inter-alia, provides for Amalgamation of Agarwal Fin-Lease and Investment Private Limited (‘Transferor Company No. 1), Chinhat Land and Finance Private Limited (‘Transferor Company No. 2), Enembee Engineers Private Limited (‘Transferor Company No. 3), Uma Sales Private Limited (‘Transferor Company No. 4), Vinamra Fin-Lease and Investment Private Limited (‘Transferor Company No. 5) with Technical Associates Limited (‘Transferee Company’) and Demerger of the ‘Investment Business’ (the ‘Investment Undertaking’) of Vibhu Enterprises Private Limited, (‘Transferor Company No. 6’ / ‘Demerged Company’) along with all the estate, assets, liabilities, rights, title, claims, interest and authorities including accretions and appurtenances thereof and vesting the same as a going concern with Technical Associates Limited (‘Transferee Company / Resulting Company’) in the manner and on the terms and conditions stated in the said Composite Scheme of Arrangement enclosed as Annexure A-1 to the Company Application.

It is submitted by Ld. Counsel appearing for the Applicant Companies that the shares of the Applicant Transferor Companies No. 1 to 6 and the Applicant Transferee Company are not listed on the Stock Exchanges. Further, the Applicant Companies have the following classes of Shareholders and Creditors:

(a) Applicant / Transferor Company No.1: Equity Shareholders, no Preference Shareholders and no Secured and Unsecured Creditors;

(b) Applicant / Transferor Company No. 2: Equity Shareholders, no Preference Shareholders and no Secured and Unsecured Creditors;

(c) Applicant / Transferor Company No. 3: Equity Shareholders, no Preference Shareholders and no Secured and Unsecured Creditors;

(d) Applicant / Transferor Company No. 4: Equity Shareholders, no Preference Shareholders and no Secured and Unsecured Creditors;

(e) Applicant / Transferor Company No. 5: Equity Shareholders, no Preference Shareholders and no Secured and Unsecured Creditors;

(f) Applicant / Transferor Company No.6 / Demerged Company: Equity Shareholders, no Preference Shareholders and Secured Creditors and 2 (Two) Unsecured Creditors;

(g) Applicant / Transferee Company / Resulting Company: Equity Shareholders, no Preference Shareholders and has both Secured Creditors and Unsecured Creditors.

In regard to Applicant / Transferor Company No. 1, it is submitted that there are 6 (Six) Equity Shareholders, no preference shareholders and no secured and unsecured creditors. A copy of the Certificate issued by the Statutory Auditors showing nil position of secured and unsecured creditors in the Applicant / Transferor Company No. 1 is annexed to the Application. All the Equity Shareholders have already given their consent to the Composite Scheme of Arrangement by way of Affidavits which are annexed to the Application.

In regard to Applicant / Transferor Company No. 2, it is submitted that there are 6 (Six) Equity Shareholders, no preference shareholders and no secured and unsecured creditors. A copy of the Certificate issued by the Statutory Auditors showing nil position of secured and unsecured creditors in the Applicant / Transferor Company No. 2 is annexed to the Application. All the Equity Shareholders have already given their consent to the Composite Scheme of Arrangement by way of Affidavits which are annexed to the Application.

In regard to Applicant / Transferor Company No. 3, it is submitted that there are 3 (Three) Equity Shareholders, no preference shareholders and no secured and unsecured creditors. A copy of the Certificate issued by the Statutory Auditors showing nil position of secured and unsecured creditors in the Applicant / Transferor Company No. 3 is annexed to the Application. All the Equity Shareholders have already given their consent to the Composite Scheme of Arrangement by way of Affidavits which are annexed to the Application.

In regard to Applicant / Transferor Company No. 4, it is submitted that there are 2 (Two) Equity Shareholders, no preference shareholders and no secured and unsecured creditors. A copy of the Certificate issued by the Statutory Auditors showing nil position of secured and unsecured creditors in the Applicant / Transferor Company No. 4 is annexed to the Application. All the Equity Shareholders have already given their consent to the Composite Scheme of Arrangement by way of Affidavits which are annexed to the Application.

In regard to Applicant / Transferor Company No. 5, it is submitted that there are 6 (Six) Equity Shareholders, no preference shareholders and no secured and unsecured creditors. A copy of the Certificate issued by the Statutory Auditors showing nil position of secured and unsecured creditors in the Applicant / Transferor Company No. 5 is annexed to the Application. All the Equity Shareholders have already given their consent to the Composite Scheme of Arrangement by way of Affidavits which are annexed to the Application.

In regard to Applicant / Transferor Company No. 6 / Demerged Company, it is submitted that there are 6 (Six) Equity Shareholders, no preference shareholders, no secured creditors and 2 (Two) unsecured creditors. A copy of the list of Creditors of the Applicant / Transferor Company No. 6 / Demerged Company duly certified by the Statutory Auditors is annexed to the Application. Both the Unsecured Creditors have given their consent in writing in the form of an Affidavit signifying their consent to the Composite Scheme of Arrangement which are annexed to the Application. All the Equity Shareholders have already given their consent to the Composite Scheme of Arrangement by way of Affidavits which are annexed to the Application.

In regard to Applicant / Transferee Company / Resulting Company, it is submitted that there are 23 (Twenty Three) Equity Shareholders, no preference shareholders, 4 (Four) secured creditors and 263 (Two Hundred and Sixty Three) unsecured creditors. A copy of the list of secured and unsecured creditors of the Applicant / Transferee Company / Resulting Company duly certified by the Statutory Auditors is annexed to the Application. All the Equity Shareholders have already given their consent to the Composite Scheme of Arrangement by way of Affidavits which are annexed to the Application.

Directions are sought accordingly for (a) dispensing with the requirement of convening meetings of the Equity Shareholders of the Applicant / Transferor Company No. 1, 2, 3, 4, 5 and 6 and the Applicant / Transferee Company, who have already given their consent to the Composite Scheme of Arrangement; (b) dispensing with the requirement of convening the meeting of the preference shareholders of the Applicant Companies, as there are no preference shareholders; (c) dispensing with the requirement of convening the meeting of the secured creditors of the Applicant / Transferor Company No. 1, 2, 3, 4, 5 and 6 as there are no secured creditors in the Applicant Transferor Companies; (d) dispensing with the requirement of convening the meeting of the unsecured creditors of the Applicant / Transferor Company No. 1, 2, 3, 4 and 5 as there are no unsecured creditors in the aforementioned Companies. (e) dispensing with the requirement of convening the meeting of the unsecured creditors of the Applicant / Transferor Company No. 6 / Demerged Company, as the unsecured creditors with requisite majority have already given their consent to the Composite Scheme of Arrangement; and (f) convening of the meetings of the Secured Creditors and Unsecured Creditors of the Applicant / Transferee Company / Resulting Company to consider the Composite Scheme of Arrangement under Section 230(1) read with Section 232(1) of the Act.

Upon perusing the records and documents in the instant proceedings and considering the submissions made on behalf of the Applicant Companies, we allow the instant application and make the following orders:-

(a) Meetings dispensed: Meetings of the Equity Shareholders of the Applicant / Transferor Company No. 1 to 5, Applicant / Transferor Company No. 6 / Demerged Company and the Applicant / Transferee Company / Resulting Company, Secured creditors of the Applicant / Transferor Company Nos. 1 to 6 and Unsecured creditors of the Applicant / Transferor Company No. 1 to 6 are dispensed with under Section 230(1) read with Section 232(1) of the Act.

(b) Meetings to be held | Date and Time: The following meetings shall be convened and held at the following time on Saturday, 9th July, 2022 for the purpose of considering and, if thought fit, approving the said Scheme, with or without modification:-

i. Meeting of Secured Creditors of the Applicant / Transferee Company / Resulting Company at 12:00 Noon at the Registered Office of the Company at 8th KM, Faizabad Road, Vijaypur, Gomti Nagar, Lucknow -226010 (Uttar Pradesh).

ii. Meeting of Unsecured Creditors of the Applicant / Transferee Company / Resulting Company at 3:00 P.M. at the Registered Office of the Company at 8th KM, Faizabad Road, Vijaypur, Gomti Nagar, Lucknow -226010 (Uttar Pradesh).

In the event any meeting, as aforesaid, spills over and is concluded after the time fixed for commencement of the succeeding meeting, such succeeding meeting shall be held immediately after such conclusion of the prior meeting.

(c) Mode of meetings: The meetings, as above, shall be held physically at the Registered office of the Applicant / Transferee Company / Resulting Company situated at 8th KM, Faizabad Road, Vijaypur, Gomti Nagar, Lucknow - 226010 (Uttar Pradesh).

(d) Advertisement: At least 30 (Thirty) clear days before the meeting(s) to be held, as aforesaid, an advertisement of the notice of meeting(s) as per Rule 7 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 be published in ‘Economic Times’ in English Language and ‘Aaj’ in Hindi Language having wide circulation in Lucknow in the state of Uttar Pradesh in which registered office of the Applicant Companies is situated by way of a joint advertisement.

(e) Individual Notices: At least 30 (Thirty) clear days before the date of the meeting(s) to be held, as aforesaid, notices convening the said meeting(s), along with all documents required to be sent with the same, including a copy of the said Composite Scheme of Arrangement, statement prescribed under the provisions of the Act disclosing necessary details and the prescribed form of proxy and the postal ballot form shall be sent to each of the Secured Creditors and Unsecured Creditors of the Applicant / Transferee Company / Resulting Company as on 31st December, 2021 (cut-off date) having value of debt exceeding Rs. 20,000/- (Rupees Twenty Thousand only) as per the list appended in the Company Application as per Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, by registered / speed post at their respective last known addresses or by email where email addresses are available. The respective notices along with accompanying documents shall also be posted on the website, if any, of the Applicant / Transferee Company / Resulting Company. The Chairperson appointed for the said meetings to issue the notices of the aforesaid meetings.

(f) Chairperson: Shri Abhinav Mehrotra, Advocate (Mobile No. 9838509679) is appointed as the Chairperson of the meetings to be held, as aforesaid. Each of these persons shall be paid a consolidated sum of ₹1,00,000/- for conducting the aforesaid meetings. Apart from the above remuneration, the Applicant / Transferee Company / Resulting Company shall make necessary and proper arrangements for travel / transport , stay and other allied expenses. The Chairperson shall have all other powers under the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 read with the other applicable rules and provisions in relation to conduct of the meetings, including for deciding procedural questions that may arise at the meeting(s) or at any adjournment thereof, or any other matter relating to the meetings, including an amendment to the Composite Scheme of Arrangement, if any, proposed by any persons.

(g) Scrutinizer: Shri Ankit Kumar Singh, Practicing Company Secretary (Mobile No. 7007496701) is appointed as the Scrutinizer of the meetings to be held as aforesaid and he shall be paid a consolidated sum of Rs. 75,000/- for the meetings. Apart from the above remuneration, the Applicant / Transferee Company / Resulting Company shall make necessary and proper arrangements for travel / transport, stay and other allied expenses.

(h) Quorum and Attendance: The quorum for the aforesaid meeting of the Secured creditors shall be 2 (Two) and for meeting of the Unsecured creditors shall be as prescribed under Section 103 of the Companies Act, 2013. For computing the quorum, persons present through valid proxy shall also be considered. In case the quorum of any of the aforesaid meeting (s) is not present, then the meeting shall be adjourned for half an hour and the persons present at the adjourned meeting(s) shall be deemed to constitute quorum .

(i) Mode of Voting: At the venue of the meetings held physically, voting shall be conducted physically by polling paper and the Secured and Unsecured creditors present in person or by proxy shall be entitled to vote thereat. Further, in addition to the voting by polling paper at the venue of the meeting, facility for voting by postal ballot shall also be provided to the Secured and Unsecured Creditors.

(j) Cut-off date: The cut-off date for determining the eligibility to vote and value of votes shall be 31st December, 2021 for the meetings of both the Secured and Unsecured Creditors of the Applicant / Transferee Company / Resulting Company. The value of the votes cast shall be reckoned and scrutinized with reference to the said date. The value of each of the Secured Creditors and Unsecured Creditors shall be in accordance with the books and records of the of the Applicant / Transferee Company / Resulting Company as on the cut-off date as stated above and, where entries in the books are disputed, the Chairperson shall determine the value for purposes of the said meetings.

(k) Voting procedure: Subject to the directions and matters dealt with herein, the procedure for voting by polling paper, postal ballot and conduct of voting at the meeting shall be in so far as the same is prescribed by the Companies (Management and Administration) Rules, 2014 and the forms thereunder shall be followed with such variations as may be required in the circumstances and in relation to the resolution for approval of the Composite Scheme of Arrangement. Persons who are entitled and have an option to vote on the resolution put to a meeting by (a) by polling paper or (b) by postal ballots as above, may opt to exercise their votes only in one of such modes. In case, they cast their votes by postal ballot as aforesaid, they will not be entitled to vote again at the meeting, whether in person or by proxy. If they do so, the votes so cast by them at the meeting shall be treated as invalid. It is clarified that such persons choosing to cast their votes by postal ballot shall nevertheless be entitled to attend and participate in the discussions in such meeting but shall not be entitled to vote again at such meeting.

(l) Proxies and Board Resolutions: A person, including a Body Corporate entitled to attend and vote at the meeting, as aforesaid, may do so personally or by proxy, provided the proxies in the prescribed form duly signed by such person and / or the certified copy of resolution of the Board of Directors or other governing body of such person, where it is a Body Corporate, authorising its representative to attend and vote at such meeting on its behalf, as the case may be, is deposited at the registered office of the Applicant / Transferee Company / Resulting Company not later than 48 (forty-eight) hours before the time for holding such meeting. If a Body Corporate chooses to vote by postal ballot , a scanned copy of such board resolution shall be sent by email to the Scrutinizer. It is clarified that proxies can only attend at the venue of the meeting and vote thereat by polling paper and are not entitled otherwise to vote by postal ballot.

(m) Scrutinizer’s Report: The votes cast shall be scrutinized by the Scrutinizer. Votes cast in all the modes shall be consolidated. The Scrutinizer shall prepare and submit the respective reports on the meetings along with all papers relating to the voting to the Chairperson of the meetings within 2 (Two) days after conclusion of the respective meetings of the Secured Creditors and Unsecured Creditors of the Applicant / Transferee Company / Resulting Company. The Chairperson shall declare the results of the meetings after submission of the reports of the Scrutinizer.

(n) Declaration of Results: The resolution for approval of the Composite Scheme of Arrangement put to the meetings shall, if approved by a majority in number representing three-fourths in value of the Secured Creditors and Unsecured Creditors of the Applicant / Transferee Company / Resulting Company casting their votes, as aforesaid, shall be deemed to have been duly passed on the date of such meeting under Section 230(1) read with Section 232(1) of the Companies Act, 2013.The declaration of results by the Chairperson shall be displayed on the Notice Board of the Applicant / Transferee Company /Resulting Company at its Registered office and shall also be posted on the websites of the Applicant / Transferee Company / Resulting Company, if any.

(o) The Chairperson to report to this Tribunal the results of the said meetings within 15 (Fifteen) days from the date of the conclusion of the said meetings. Such report shall be in Form No. CAA4 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 verified by affidavit.

Notice under Section 230(5) of the Companies Act, 2013 along with all accompanying documents, including a copy of the aforesaid Composite Scheme of Arrangement and statement under the provisions of the Companies Act, 2013 shall also be served on the (i) Central Government through the Regional Director, Northern Region, Ministry of Corporate Affairs; (ii) Registrar of Companies, Uttar Pradesh within whose jurisdiction the Applicant Companies are registered; (iii) Income-Tax Authorities within whose jurisdiction the Applicant Companies are assessed, clearly indicating the PAN of the company concerned; (iv) the Official Liquidator, Uttar Pradesh; by hand delivery or by registered / speed post or by email forthwith after the notices are sent to the secured creditors and unsecured creditors, as aforesaid. The notice shall specify that representation, if any, should be filed before this Tribunal within 30 (Thirty) days from the date of receipt of the notice with a copy of such representation being simultaneously sent to the Counsel of the said Applicants. If no such representation is received by the Tribunal within such period, it shall be presumed that such authorities have no representation to make on the said Composite Scheme of Arrangement. Such notice shall be sent pursuant to Section 230(5) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Compromises, Arrangements and Amalgamations) Rules 2016 in Form No. CAA3 of the said Rules with necessary variations incorporating the directions herein.

The Applicants to file an affidavit proving service of notices of meetings and publication of advertisement and compliance of all directions contained herein at least a week before the meetings to be held.

With the above directions CA (CAA) No. 6 / ALD / 2022 is accordingly, disposed of.

Connected company petition be filed within a period of three weeks.