DLF Golf Resorts Limited Vs

Subrata Kumar Dash, Member (Technical)

CA No. 200/2022

The present application has been filed by the applicant companies for placing on record the financial statements as on 31.03.2022. The same are taken on record. CA No. 200/2022 stands allowed and disposed of.

CA (CAA) No. 36/Chd/Hry/2022

This is a joint first motion application filed by Applicant Companies namely; DLF Golf Resorts Limited (Applicant Company No. 1/Transferor Company No. 1), DLF Homes Services Private Limited (Applicant Company No. 2/Transferor Company No. 2) and DLF Recreational Foundation Limited (Applicant Company No. 3/Transferee Company) under Sections 230-232 of Companies Act, 2013 (the Act) and other applicable provisions of the Act read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 (the Rules) in relation to the Scheme of Amalgamation between the Applicant Companies. The said Scheme is attached as Annexure A-1 of the Application.

The Applicant Companies have prayed interalia, for dispensing with the requirement of the convening of the meetings of the Equity Shareholders, Applicant Companies, Compulsory Convertible Debenture Holders and secured and unsecured creditors of Applicant Companies Nos. 2 and 3.

The Applicant Company No. 1 is presently engaged in the business to establish, own or take on lease and run one or more Golf Courses and carry on all other activities related to or connected with incidental to or usually combined with Golf Course Clubs.

The Applicant Company No. 2 is presently engaged in the business of providing services of management, protection and maintenance of multi-stored buildings/colonies, residential houses, bungalows, apartment, business premises commercial complexes, office complexes etc.

The Applicant Company No. 3 is presently engaged in the business of setting up and developing clubs, hotels, hospitality, service rooms, community centers, recreational facilities, leisure and sports etc.

It is submitted that the registered offices of Applicant Companies are situated in Haryana, therefore, the territorial jurisdiction of all the applicant companies fall within this Bench.

The rationale of the Scheme is given below:-

This Scheme would benefit the respective companies involved in this Scheme and their shareholders on account of the following reasons:

a) The amalgamation will result in better, efficient and economical management, achieve cost savings, pooling of resources and rationalization of administrative expenses/services. The amalgamation will enable the companies to pool their financial, commercial and other resources and synergy of operations would be achieved.

b) The amalgamation will enable the companies to achieve optimal capital structure and achieve efficiency in terms of operations of the merged entity under the combined entity.

c) The amalgamation will reduce administrative costs and operative and overhead expenses which would further lead to greater and effective executive control, cost efficiency, synergy of operations, and optimum utilization of the resources. It will result in reduction in multiplicity of legal and regulatory compliances required at present to be carried out by the Transferor Companies and the Transferee Company. With the enhanced resources at its disposal, the Transferee Company will have greater flexibility and strength and will be able to compete more effectively as a combined entity.

d) The Transferee Company as a consolidated entity after amalgamation will have better financial and business prospects. This Scheme would be beneficial to and in the best interest of the respective shareholders of the Transferor Companies and the Transferee Company. This Scheme shall not in any manner be prejudicial to the interests of concerned members/creditors, directors, key managerial personnel, vendors or general public at large.

e) The  amalgamation  would  be  advantageous  to  combine  the activities of the Transferor Companies and the Transferee Company into a single company and consolidate their business and assets.

The application is filed for seeking sanction of Scheme of Amalgamation between Transferor Companies and Transferee Company and their respective shareholders. As per the Scheme the secured creditors as well as the unsecured creditors will be paid in full as and when their respective amounts fall due in usual course and thus, the Scheme is not affecting the rights of creditors. The aggregate assets of Transferor Company and Transferee Company are more than sufficient to meet the liabilities of the unsecured creditors of the Applicant Companies.

It is stated that the Board of Directors of the Applicant Companies in their meeting held on 10.05.2022 have considered and unanimously approved the Scheme of Amalgamation subject to sanctioning of the same by this Tribunal. The copy of the board resolutions of the Applicant Companies are attached as Annexure A-4, A-10 and A-17 respectively of the application.

The appointed date of the Scheme is 01.04.2021 as mentioned in the Section I Clause ii of Scheme of Amalgamation which is attached as Annexure A-1 of the application.

It is stated that the Applicant Companies have filed the audited Balance Sheets as on 31.03.2021 and provisional balance sheets as on 31.03.2022 which are attached as Annexure A of Diary No. 01646 dated 18.07.2022

It is submitted that in pursuance Sec. 230 and Section 232 of the Act, the Applicant Companies have filed certificates, dated 10.05.2022 issued by Chartered Accountants of Applicant Companies certifying that the Scheme is

in compliance with the Accounting Standards under Section 133 of the Act and the same are attached as Annexure A-23 of the application.

It is further submitted by the counsel for applicant companies that the valuation report has been submitted by Mr. Romesh Vijay, Registered Valuer having IBBI Registration No: IBBI/RV-E/06/2019/11008 which is attached as Annexure A-22 of the application. As per valuation report, dated 10.05.2022, the following Share Exchange Ratio has been proposed :-

“As consideration for the merger of DGRL and DHSPL into DRFL.

● DRFL will issue 706 equity shares of Rs. 10/- (Rupees Ten only) each credited as fully paid for 10 equity shares of Rs. 10/-(Rupees Ten only) each held by the equity shareholders in the DGRL to the equity shareholders of the DGRL.

● DRFL will issue 1 equity share of Rs 10/- (Rupees Ten only) each credited as fully paid for all equity shares of Rs. 10-/ (Rupees Ten only) each held by the equity shareholders in the DHSPL to the equity shareholders of the DHSPL.”

It is averred that the Scheme [Annexure A-1 of the application] also takes care of the interests of the staff/workers and employees of the Companies by virtue of Part A, Clause 8.5 of the Scheme.

It is deposed by the authorized signatories of applicant companies by way of affidavits that there are no material legal proceedings pending against applicant companies under Companies Act, 2013, Service Tax/GST, the aforesaid affidavit duly signed by the authorized signatories of applicant companies attached as Annexure A-24 with the petition.

The applicant companies have furnished the following documents:-

i. Proposed Scheme of Amalgamation (Annexure A-1 of the application)

ii. Certificate of Incorporation along with Memorandum and Articles of Association of the applicant companies (Annexure A-2, A-8 and A-15 respectively of the application).

iii. List of Equity Shareholders duly certified by Pratap Rastogi & Associates, Chartered Accountant as on 10.05.2022 with consent affidavits of the Applicant Companies (Annexure A-5, A-11 and A-18 of the application)

iv. List of Compulsorily Convertible Debenture Holders of Applicant Company No. 2 and 3 duly certified by Pratap Rastogi & Associates, Chartered Accountant as on 22.03.2022 (Annexure A-12 and A-19 respectively of the application).

v. Certificates of Statutory Auditors to the effect that Accounting treatment proposed in the Scheme is in conformity with Section 133 of Companies Act, 2013 (Annexure A-23 of the application).

vi. Proposed Share Exchange Ratio (Annexure A-22 of the application).

vii. Audited Financial Statements as on 31.03.2021 of the Applicant Companies (Annexure A-3, A-9 and A-16 of the application).

viii. Provisional balance sheet as on 31.12.2021 of the Applicant Companies (Annexure A-3, A-9 and A-16 of the application).

ix. Affidavits mentioning legal proceedings furnished by Authorised Signatories of applicant companies. (Annexure A-24 of the application).

x. List of creditors duly certified by Pratap Rastogi & Associates, Chartered Accountant on 22.03.2021 of Applicant Company No. 1/Transferor Company No. 1. (Annexure A-6 of the application)

xi. List of creditors duly certified by Pratap Rastogi & Associates, Chartered Accountant on 22.03.2021 along with consent affidavit of unsecured creditors as on 16.05.2022 of Applicant Company No. 2/Transferor Company No. 2. (Annexure A-13 of the application)

xii. List of creditors duly certified by Pratap Rastogi & Associates, Chartered Accountant on 22.03.2021 along with consent affidavit of unsecured creditors as on 16.05.2022 of Applicant Company No. 3/Transferee Company No. 3. (Annexure A-20 of the application)

xiii. Audited Financial Statements as on 31.03.2022 of the Applicant Companies. (Annexure A of Diary No. 01646 dated 18.07.2022)

The Applicant Companies have furnished the details of the Equity Shareholders, Debenture Holders, Secured Creditors and Unsecured Creditors along with consent on affidavits which is as follow:

Name of

Shareholders along with

Creditors along with their consent

the

their consent

Applicant

Companies

Equity

Consent

Debenture

Consent

Secured

Consent

Unsecure

Consent

Shareholder

submitted

Holders

submitted

Creditors

submitted

d

submitted

on

on

on

Creditors

on

affidavit

affidavit

affidavit

affidavit

Applicant

7(Seven)

100% (in

NIL

N.A.

NIL

N.A.

NIL

N.A.

Company

Equity

value)

No. 1

Shareholders

Applicant

7 (Seven)

100% (in

1 (One)

100% (in

Nil

N.A.

12(Twelve)

93% (in

Company

Equity

value)

value)

Unsecured

value)

No. 2

Shareholders

Creditors

Applicant

7 (Seven)

100% (in

03(Three)

100% (in

NIL

N.A.

04(Four)

100% (in

Company

Equity

value)

value)

value)

No. 3

Shareholders

Accordingly, the directions of this Bench in the present case are as under:-

I. In relation to the Company/Applicant Company No.1:

a. The meetings of the Equity Shareholders are dispensed with keeping in view the shareholding pattern, financial structure of the company and the fact that the consent of all the Equity Shareholders has been received by way of affidavits.

b. Since, there is no Debenture Holder, Secured Creditor and Unsecured Creditor in the Applicant Company No.1 /Transferor Company No.1, there is no scope for any meeting.

II. In relation to the Applicant Company No. 2/Transferor Company No. 2:

a. The meetings of the Equity Shareholders are dispensed with keeping in view the shareholding pattern, financial structure of the company and the fact that the consent of all the Equity Shareholders has been received by way of affidavits.

b. The meeting of the Debenture Holders of the Applicant Company No. 2/Transferor Company No. 2 is dispensed with as it has 1 (One) Debenture Holder and the consent of sole Debenture Holder has been received by way of affidavit.

c. Since, there is no Secured Creditor in the Applicant Company No. 2/Transferor Company No. 2. therefore, there is no scope for any meeting.

d. The meeting of the Unsecured Creditors of the Applicant Company No. 2/Transferor Company No. 2 is dispensed with as it has 12 (Twelve) Unsecured Creditors and consent of Unsecured Creditors holding 93% in value have been received by way of affidavits.

III. In relation to the Applicant Company No. 3/Transferee Company:

a. The meetings of the Equity Shareholders are dispensed with keeping in view the shareholding pattern, financial structure of the company and the fact that the consent of all the Equity Shareholders have been received by way of affidavits.

b. The meeting of the Debenture Holders of the Applicant Company No. 3/Transferee Company is dispensed with as it has 3 (Three) Debenture Holder and the consent of all Debenture Holders have been received by way of affidavits.

c. Since, there is no Secured Creditor in the Applicant Company No.

3/Transferee Company. There is no scope for any meeting.

d. The meeting of the Unsecured Creditors of the Applicant Company No. 3/Transferee Company is dispensed with as it has 4 (Four) Unsecured Creditors and the consent of all Unsecured Creditors have been received by way of affidavits.

The Applicant Companies are directed to submit on affidavit all material facts relating to the companies, such as pendency of any investigation of any proceeding against the company, if any in compliance of Section 230 (2) (a) of the Companies Act,2013.

In view of the above, the First Motion Application stands allowed by giving liberty to the Applicant Companies to file Second Motion Petition with a direction that the Applicant Companies shall make specific prayer for sending notices to the (a) Central Government through Regional Director, Northern Region, Ministry of Corporate Affairs, New Delhi, (b) concerned Registrar of Companies; (c) Official Liquidator and (d) Income Tax Authorities by disclosing the PAN numbers of all the Applicant Companies in the title of the Second Motion Petition. The applicant companies shall also file separate affidavits stating the Sectoral regulators governing the respective companies while filing second motion petition.