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Judgment
This Court is convened by video conference.
CA No. 350 of 2021 in CA No. 8 of 2021:
The Counsel for the Applicant Companies submit that vide the order dated September 28, 2021in CA (CAA) 8 of 2021, this Bench had inter-alia directed the Applicant Companies to conduct of following meetings:
a. Meetings of the equity shareholders of the First, Second, Third, Fourth, Fifth and Twentieth Applicant Companies to be held on November 10, 2021.
b. Meetings of the secured creditors of the Applicant companies on November 11, 2021 and November 12, 2021.
c. Meetings of the unsecured creditors of the Applicant companies on November 11, 2021 and November 13, 2021.
The present Application is filed for the limited purpose for revising the dates of the meetings of the equity shareholders / secured creditors / unsecured creditors for the following reasons:
a. There were around 53,000 equity shareholders and 2300 secured creditors/ unsecured creditors for which there was printing of around 5.25 crore pages of the notices and there was logistic difficulty in dispatching these notices within the time period (as the order in the matter CA(CAA) 8 of 2021 was received on October 07, 2021);
b. The Applicant Companies received a representation dated October 30, 2021 from its bankers (its financial creditors) requesting that the Applicant companies seek an extension of the dates of the meetings since the bankers were yet to review the documents pertaining to the Scheme and it was unlikely that the bankers could schedule their internal committee meeting prior to November 11 and November 12, 2021.
CA No. 357/2021 in CA No. 350/2021 in CAA/8/2021:
The present Application has filed by Amazon.com NV Investment Holdings LLC under Rule 11 of NCLT Rules to bring on record materials. It was pointed out that on 25.10.2020, the Emergency Arbitrator passed an interim award (“EA order”) which certain dipositive directions the order is reproduced below:
a. “The Respondents are injuncted from taking any steps in furtherance or in aid of the Board Resolution made by the Board of Directors of FRL on 29 August 2020 in relation to the Disputed Transaction, including but not limited to filing or pursuing any application before any person, including regulatory bodes or agencies in India, or requesting for approval at any company meeting;
b. The Respondents are injuncted from taking any steps to complete the Disputed Transaction with entities that are part of the MDA Group;
c. Without prejudice to the rights of any current Promoter Lenders, the Respondents are injuncted from directly or indirectly taking any steps to transfer/dispose/alienate/encumber FRL’s Retail Assets or the shares held in FRL by the Promoters in any manner without the prior written consent of the Claimant;
d. The Respondents are injuncted rom issuing securities of FRL or obtaining/securing any financing, directly or indirectly, from any Restricted Person that will be in any manner contrary to Section 13.3.1 of the FCPL SHA;
e. The orders in (a) to (d) above are to take effect immediately and will remain in place until further order from the Tribunal, when constituted; and
f. The Claimant is to provide within 7 days from the date hereof a cross-undertaking in damages to the Respondents. If the Parties are unable to agree on its terms, they are to refer their differences to me qua EA for resolution; and
g. The costs of this Application be part of the costs of this Arbitration.”
The Applicant further stated that the present Application in CA 350 in CA (CAA) 8 has been filed in violations of directions passed in the EA order. The Applicant sought for dismissal CA No. 350 in CA/8/2021.
FINDINGS:
This matter was posted for clarification on 24.02.2022 and during the course of hearing learned Senior Counsel for the Petitioner pointed out that an order of Hon’ble Supreme Court in Civil Appeal No. 859-860 of 2022 was passed on 15.02.2022, wherein the steps/stages with regard to approval of the proposed Scheme to culminate into the final order where captured at Para 11 and the same is reproduced is below:
S. No.
Process
1
Pronouncement of Order of NCLT, Mumbai Bench
2
Receipt of admission stage order from NCLT
3
Dispatch of Notice/ addendum to Notice
4
Advertisement of Notice in Newspaper in Form CAA-2 (not less than 30 days before the date of hearing)
5
Notice u/s. 230(5) to the regulatory authorities
6
Filing of requisite documents with ROC, RD and OL
7
Affidavit to be filed not less than 7 days before the scheduled date of meetings
8
Meetings of Shareholders and Creditors
First date of the Meetings
Last date of Meetings
9
Chairman report in Form CAA.4 to be filed with NCLT
10
Filing of Petition with NCLT in Form CAA.5 within 7 days of Chairman Report
11
Admission of Petition and determination of date of final hearing by NCLT
12
Advertisement in newspaper of final hearing of petition (not less than 10 days before the final hearing)
13
Notice of final hearing also to be given to the regulators/ objectors from whom the representation is received
14
Filing of Affidavit confirming service of notice, publication of advertisement (at least 3 days before the hearing)
15
Final hearing of petition by NCLT for approval of the scheme
16
After hearing, passing of final order sanctioning the scheme
Further at para 16 the Hon’ble Supreme Court has granted liberty to FRL to approach the Hon’ble High Court by filing application seeking continuation of NCLT proceedings beyond the stage (meetings of Shareholders and Creditors). Para 16 is reproduced below:
In view of the above submissions, we grant liberty to FRL to approach the High Court by filing an application seeking continuation of the NCLT proceedings beyond the 8th Stage (Meeting of Shareholders and Creditors). Accordingly, we request the learned Single Judge of the Delhi High Court, to consider all the contentions raised by both the parties in this regard and pass appropriate order as to continuation of the NCLT proceedings beyond the stage mentioned at serial no. 8 and other regulatory approvals expeditiously, uninfluenced by any observations made herein.
However, the Senior Counsel for the Respondent objected for calling for any meeting in view of the order dated 29.10.2021 of Arbitral Tribunal of Singapore and the order passed by the Hon’ble Supreme Court on 01.02.2022. The order passed by Hon’ble Supreme Court on 01.02.2022 records setting aside of impugned order dated 22.02.2021 and 18.03.2021 (2nd Impugned Order) in OMP (ENF)(Comm.) No. 17 of 2021 and further set aside the 3rd impugned order dated 29.10.2021 in Arbitration Appeal No. 64 and 63 of 2021.
The short point which arises for consideration is whether this Bench can revise the date of meetings in furtherance of the order passed by this Tribunal on 28.09.2021 to convene meetings of shareholders and creditors of the Applicant Companies.
This Bench notes that in view of the clear direction of Hon’ble Supreme Court dated 15.02.2022, FRL was granted liberty to approach the Hon’ble High Court by filing Application seeking continuation of NCLT proceedings beyond 8th stage (meetings of shareholders and creditors). Hence, in view of the above directions of Hon’ble Supreme Court, this Bench concludes that the meetings of the shareholders and creditors can be revised.
In view of the above and in continuation of the order dated 28 September 2021 passed in CA No. 8 of 2021, this Bench directs the Applicant Companies to conduct the meetings of the equity shareholders / members (including Class B Series 1 shareholders for the Transferee Company) and creditors as following:
A. This Bench hereby modify appointment of Chairpersons for the meetings (which include meetings of shareholders, secured creditors and unsecured creditors as aforesaid), as follows:-
Sr. No.
Applicant Company’s Number
Chairperson’s Name and Designation
1.
Second Applicant Company
· Mr. Shailesh Haribhakti failing him
· Mrs. Sharda Sunder
B. That the meeting of the Equity Shareholders (in case of First Applicant Company, Second Applicant Company, Third Applicant Company, Fourth Applicant Company and Fifth Applicant Company) / Members (comprising of equity shareholders and Class B (Series 1) equity shareholders in case of Twentieth Applicant Company) of the following Applicant Companies will be convened and held as follows:
Applicant Company’s Number
Month, Date & Time
First Applicant Company
20/04/2022, Wednesday, 10:30 am
Second Applicant Company
20/04/2022, Wednesday, 9:00 am
Third Applicant Company
20/04/2022, Wednesday, 03:00 pm
Fourth Applicant Company
20/04/2022, Wednesday, 12:00 noon
Fifth Applicant Company
20/04/2022, Wednesday, 1:30 pm
Twentieth Applicant Company
20/04/2022, Wednesday, 04:30 pm
C. This Bench directs conduct of meetings of creditors of the Applicant Companies as follows:
(a) That the meeting of the secured creditors of the below mentioned Applicant Companies will be convened and held as follows:
Applicant Company’s Number
Month, Date & Time
First Applicant Company
21/04/2022, Thursday, 10:30 am
Second Applicant Company
21/04/2022, Thursday, 09:00 am
Third Applicant Company
21/04/2022, Thursday, 02:15 pm
Fourth Applicant Company
21/04/2022, Thursday, 12:00 noon
Fifth Applicant Company
21/04/2022, Thursday, 01:30 pm
Applicant Company’s Number
Month, Date & Time
Seventh Applicant Company
22/04/2022, Friday,
10:00 am
Eighth Applicant Company
22/04/2022, Friday,
10:30 am
Ninth Applicant Company
22/04/2022, Friday,
11:00 am
Tenth Applicant Company
22/04/2022, Friday,
11:30 am
Eleventh Applicant Company
22/04/2022, Friday, 12:00 noon
Twelfth Applicant Company
22/04/2022, Friday,
12:30 pm
Thirteenth Applicant Company
22/04/2022, Friday,
01:00 pm
Fourteenth Applicant Company
22/04/2022, Friday,
02:30 pm
Fifteenth Applicant Company
22/04/2022, Friday,
03:00 pm
Sixteenth Applicant Company
22/04/2022, Friday,
03:30 pm
Seventeenth Applicant Company
22/04/2022, Friday,
04:00 pm
Eighteenth Applicant Company
22/04/2022, Friday,
04:30 pm
Applicant Company’s Number
Month, Date & Time
Nineteenth Applicant Company
22/04/2022, Friday,
05:00 pm
Twentieth Applicant Company
21/04/2022, Thursday, 04:30 pm
(b) There are no secured creditors in the Sixth Applicant Company as on January 31, 2022. Hence the meeting of secured creditors of the Sixth Applicant Company is hereby dispensed with.
D. That the meeting of the unsecured creditors of the below mentioned Applicant Companies will be convened and held as follows:
Applicant Company’s Number
Month, Date & Time
First Applicant Company
21/04/2022, Thursday, 11:15 am
Second Applicant Company
21/04/2022, Thursday, 9:45 am
Third Applicant Company
21/04/2022, Thursday, 03:00 pm
Applicant Company’s Number
Month, Date & Time
Fourth Applicant Company
21/04/2022, Thursday, 12:45 pm
Fifth Applicant Company
21/04/2022, Thursday, 02:15 pm
Sixth Applicant Company
23/04/2022, Saturday, 9:30 am
Seventh Applicant Company
23/04/2022, Saturday, 10:00 am
Eighth Applicant Company
23/04/2022, Saturday, 10:30 am
Ninth Applicant Company
23/04/2022, Saturday, 11:00 am
Tenth Applicant Company
23/04/2022, Saturday, 11:30 am
Eleventh Applicant Company
23/04/2022, Saturday, 12:00 noon
Twelfth Applicant Company
23/04/2022, Saturday, 12:30 pm
Applicant Company’s Number
Month, Date & Time
Thirteenth Applicant Company
23/04/2022, Saturday, 01:00 pm
Fourteenth Applicant Company
23/04/2022, Saturday, 02:30 pm
Fifteenth Applicant Company
23/04/2022, Saturday, 03:00 pm
Sixteenth Applicant Company
23/04/2022, Saturday, 03:30 pm
Seventeenth Applicant Company
23/04/2022, Saturday, 04:00 pm
Eighteenth Applicant Company
23/04/2022, Saturday, 04:30 pm
Nineteenth Applicant Company
23/04/2022, Saturday, 05:00 pm
Twentieth Applicant Company
21/04/2022, Thursday, 05:15 pm
E. The respective Applicant Companies shall send an addendum to the original notices to their respective shareholders, secured creditors and unsecured creditors not later than 20 March 2022 through Email (to those shareholders / creditors whose email addresses are duly registered with the Applicant Companies for the purpose of receiving such notices by email) or by Air Mail / Courier / Registered Post / Hand Delivery / Speed Post at their last known address as per the records of the respective Applicant Company.
F. The quorum for the aforesaid meeting of the Equity Shareholders, Secured Creditors and Unsecured Creditors of the Applicant Companies shall be as prescribed under Section 103 of the Companies Act, 20l3. It is hereby clarified that in the event there are no creditors in any of the Applicant Companies then the meeting of the creditors of such Applicant Company would not be required to be conducted and it will be sufficient compliance of this order. In case the required quorum as stated above is not present at the commencement of the meeting, the meeting shall be adjourned by 15 (fifteen) minutes and thereafter the persons present shall be deemed to constitute the quorum.
G. After the order was pronounced, the learned Counsel for the Applicant Companies pointed out that vide letter dated 22nd November, 2021 M/s T.R. Chadha LLP has informed the Office of Official Liquidator, High Court, Bombay that as they are carrying on certain assignments for Future Consumer Limited and few other Transferor Companies, hence they are not accepting this assignment.
H. The bench hereby appoints M/s Bipin Shah & Associates, Chartered Accountants to assist the Official Liquidator to scrutinize the books of accounts of the Transferor companies for the last five years on remuneration of Rs. 5,00,000 (Rupees Five Lakhs only).
The rest of the order dated 28 September 2021 in CA (CAA) 8 of 2021 remains the same and the Application No 350 of 2021 is disposed of accordingly.
This Court doth orders as follows.
a. CA No. 350 of 2021 in CA (CAA) 8 of 2021 is allowed.
b. CA No. 357 of 2021 in CA No. 350 of 2021 in CA (CAA) 8/2021 is dismissed.