Greenview Tea Company Privata Limited Vs

Rohit Kapoor, Member (Judicial)

It is submitted by Ld. counsel appearing for the Petitioner that the Petitioner No 1 , Petitioner No 2 , Petitioner No 3 and Petitioner No 4 are under the jurisdiction of the Guwahati Bench . Hence this Bench has no jurisdiction in their regard .

The instant petition has been filed under Section 230(6) read with Section 232(3) of the Companies Act, 2013 (“Act”) for sanction of the Composite Scheme of Arrangement whereby the Investment Division of GREENVIEW TEA COMPANY PRIVATE LIMITED being the Petitioner No. 5 above named ("Demerged Company " or “Petitioner No.5”) will be Demerged by transfer and vesting of the same in VRINDAVAN PROJECTS PRIVATE LIMITED being the Petitioner No.1 above named (" Resulting Company " or “Petitioner No.1” – the NON APPLICANT) from the Appointed Date, 01st April,2019 in the manner and on the terms and conditions stated in the said Composite Scheme of Arrangement (“Scheme”).

The Petition has now come up for final hearing. Counsel for the Applicants submits as follows:-

(a) The Scheme was approved by the Board of Directors of Petitioner No 5 at their meeting held on 06th October,2020. Further the Board of Directors of Petitioner No 1 , Petitioner No 3 and Petitioner No 4( all Non Petitioner Companies ) have at their meeting held on 06th October,2020 and Petitioner No 2 ( Non Petitioner ) at their meeting held on 05th October,2020 have approved the Composite Scheme of Arrangement.

(b) The circumstances which justify and/or have necessitated the Composite Scheme of Arrangement and the benefits of the same are, inter alia, as follows:-

FOR THE PURPOSE OF AMALGAMATION

a. As part of an overall scheme of arrangement, the management of the TRANSFEROR COMPANIES and TRANSFEREE COMPANY has concurred on a plan whereby all the TRANSFEROR COMPANIES will be amalgamated with the TRANSFEREE COMPANY. The TRANSFEROR COMPANIES are involved in the business of construction of contractual basis inter-alia it has made deployment of surplus funds in other investable instruments. The TRANSFEREE COMPANY was incorporated with object of real estate activities and is currently engaged in leasing of equipment used in construction and infrastructure business and while pursuing the same has also made deployment of surplus funds other investible instruments. Thus, the Business carried on by the TRANSFEREE COMPANY and TRANSFEROR COMPANIES can be combined and carried forward.

b. The arrangement will enable the TRANSFEREE COMPANY to consolidate its line of business by restructuring and re-organizing its business activities and Capital Structure;

c. The arrangement will enable the amalgamated company to broad base their business activities under the roof of the TRANSFEREE COMPANY;

d. The arrangement will result in economy of scale including reduction in overhead expenses relating to management and administration in better and more productive utilization of various resources;

e. The said Scheme of Arrangement will enable the establishment of a larger company with larger resources and a larger capital base enabling further development of the business of the company concerned. The said scheme will also enable the undertakings and business of the Transferee Company to obtain greater facilities possessed and enjoyed by one large company compared with a number of small Company for raising capital, securing and conducting trade on favorable terms and other benefits;

f. The said scheme will contribute in furthering and fulfilling the objects of the Company concerned and, in the growth, and development of these businesses;

g. The said scheme will strengthen and consolidate the position of the amalgamated company and will enable the amalgamated company to increase its profitability;

h. The said scheme will enable the undertakings concerned to pool their resources and to expand their activities;

i. The said scheme will enable the Companies concerned to rationalize and streamline their management, business and finances and to eliminate duplication of work to their common advantages.

j. The management of the respective TRANSFEROR COMPANIES is also of the view that the Scheme of Arrangement by which it is being amalgamated with the TRANSFEREE COMPANY will be beneficial for their shareholders.

FOR THE PURPOSE OF DEMERGER

k. The Demerger of INVESTMENT DIVISION of the DEMERGED COMPANY and transfer and vesting of the same in the RESULTING COMPANY will strengthen the RESULTING COMPANY and allow the Resulting Company to provide depth and focus along with adoption of strategies necessary for its growth and expansion by utilising the liquid and marketable assets of the Demerged Undertaking.

l. Post demerger the management of the DEMERGED COMPANY can lend greater focus to the operations of remaining business mainly consisting of Tea Manufacturing and Trading Activities as the company expects better opportunities in the market.

m. By demerger of Demerged Undertaking into the Resulting Company, the financial resources will be conveniently merged and pooled with the resources of the Resulting Company, leading to utilisation of resources towards expansion and growth of the business of the Resulting Company.

n. Post this restructuring both DEMERGED COMPANY and RESULTING COMPANY are expected to be better poised for meeting future growth opportunities, gain the advantage of cost savings and improvement of their earning potential.

o. The management of the DEMERGED COMPANY is of the opinion that the Scheme of Arrangement will provide greater capacity and better utilization of its resources. The Scheme of Arrangement will also enable it to consolidate its business by restructuring and reorganizing its business activities and capital structure.

(c) The Statutory Auditors of the Petitioner Company have by their certificate dated 11th November, 2020 and the Statutory Auditors Non Petitioner Companies have all by their certificate dated 09th November, 2020 have confirmed that the accounting treatment in the Scheme is in conformity with the accounting standards prescribed under Section 133 of the Companies Act, 2013.

(d) No proceedings are pending under Sections 210 to 227 of the Companies Act, 2013 against the Petitioner(s).

(e) The exchange ratio of shares in consideration of the Amalgamation has been fixed on a fair and reasonable basis and on the basis of the Report dated 27th February,2020 thereon of ANIL KUMAR GUPTA, IBBI , Registered Valuer.

(f) By an order dated 2nd December, 2021 in Company Application No. CA/(CAA)/110/KB/2021 this Tribunal made the following directions with regard to meetings of shareholders and creditors under Section 230(1) of the Act:-

a. Meetings dispensed:

Meeting of Equity Shareholders of the Applicant No 5 for considering the Scheme are dispensed with in view of all shareholders of Applicant No 5 having respectively given their consent to the Scheme by way of affidavits.

Meeting of Preference Shareholders of the Applicant No 5 for considering the Scheme are dispensed with in view of all shareholders of Applicant No 5 having respectively given their consent to the Scheme by way of affidavits.

Meeting of Secured Creditors of the Applicant No 5 for considering the Scheme are dispensed with in view consent by 100% in value of Secured Creditors of Applicant No 5 having respectively given their consent to the Scheme by way of affidavits.

Meeting of Unsecured Creditors of the Applicant No 5 for considering the Scheme are dispensed with in view consent by 99.96% in value of Secured Creditors of Applicant No 5 having respectively given their consent to the Scheme by way of affidavits.

b. No requirement of Meetings No requirement of meetings

c. Meetings to be held

No meeting required to be held .

Consequently, the Petitioner(s) presented the instant petition for sanction of the Scheme. By an order dated 21ST June,2022 the instant petition was admitted by this Tribunal and fixed for hearing on 26th July,2022 upon issuance of notices to the Statutory / Sectoral Authorities and advertisement of date of hearing. In compliance with the said order dated 21st June,2022 the Petitioner(s) have duly served such notices on the Regulatory Authorities viz Upon Income Tax Authorities though special messenger on 09th July ,2022 and by email on 13th July,2022, Upon Registrar of Companies , Kolkata ,West Bengal through special messenger on 30th June ,2022 and by email on 06th July 2022 and Upon Regional Director, Eastern Region through special messenger on 30th June ,2022 and by email on 06th July 2022 , Upon Official Liquidator , High Court Calcutta on 30th June,2022. The Petitioner(s) have also published such advertisements once each in the Financial Express and Dainik Statesman in their respective issues dated 01st July,2022. An affidavit of Compliance duly affirmed on 13th July,2022 has also been filed.

All statutory formalities requisite for obtaining sanction of the Scheme have been duly complied with by the Petitioners. The Scheme has been made bona fide and is in the interest of all concerned.

As the Company Petition before this Bench is for Demerger of one of the Division of the Demerged Company by transferring and vesting of the same in the Resulting Company the report of the Official Liquidator is not required.

Pursuant to the said advertisements and notices the Regional Director, Ministry of Corporate Affairs, Kolkata (“RD”) have filed their representations before this Tribunal.

The RD has filed his reply affidavit dated 19th July,2022 (“RD affidavit”) which has been dealt with by the Petitioner(s) by their Rejoinder affidavit dated 22nd July,2022 (“Rejoinder”). The observations of the RD and responses of the Petitioner(s) are summarized as under:-

Paragraph 2 (a) of RD Affidavit

It is submitted that the Transferee Company cum Resulting Company Vrindavan Projects Private Limited and Transferor Companies namely , Infracare Systems Private Limited , Khordia Builders Private Limited , Vardhaman Trading Company Private Limited are registered in the State of Assam which is not under the jurisdiction of this Deponent. Hence, this Deponent has no comment on them.

Paragraph 2 (a) of the Rejoinder

The observation made by the Regional Director are only informative in nature .

Hence no reply is offered.

Paragraph 2 (b) of RD Affidavit

It is submitted that on examination of the report of the Registrar of Companies, West Bengal, it appears that no complaint and/or representation regarding the proposed Scheme of Amalgamation has been received against Greenview Tea Co Private Limited . Further, as per available records , the Demerged Company Greenview Tea Co Private Limited is updated in filing their statutory Returns for the financial year 31/03/2021. The Report of the Registrar of Companies , West Bengal received in the matter is enclosed herewith as Annexure –I for perusal and ready reference.

Paragraph 2 (b) of the Rejoinder

No adverse comments made by the Registrar of Companies, West Bengal in his report to the Regional Director. Further the Registrar of Companies, West Bengal has not received any Complaint and / or representation from any person on the proposed Scheme. Hence no comments are offered.

Paragraph 2 (c) of RD Affidavit

Petitioner company should undertake to comply with the provisions of section 232(3)(i) of the Companies Act,2013 through appropriate affirmation.

Paragraph 2 (c) of the Rejoinder

The Deponent duly authorised hereby confirms that the Transferee Company undertakes to comply with the provisions of Sec 232(3)(i) of the Companies Act, 2013 in regard to adjustment of fees upon clubbing of Authorized Share Capital(s) of the Transferor Company (ies) with the Authorized Share Capital of the Transferee Company in post-amalgamation and shall file a detailed statement thereof with the Registrar of Companies at the time of filing of INC – 28.

Paragraph 2 (d) of RD Affidavit

That the Transferee Company should be directed to pay stamp duty, if any, applicable on the transfer of the immovable properties from the Transferor Companies to it.

Paragraph 2 (d) of the Rejoinder

The Deponent duly authorized hereby undertakes that Petitioner Companies, shall file list / details of assets that will be transferred by the Transferor Companies to the Transferee Company upon coming into effect of the Scheme.

Paragraph 2 (e) of RD Affidavit

That the Transferee Company should be directed to pay stamp duty, if any, applicable on the transfer of the immovable properties from the Transferor Companies to it.

Paragraph 2 (e) of the Rejoinder

The Deponent duly authorized hereby undertakes that the Transferee Company / Resultant Company shall pay applicable stamp duty on the transfer of the immovable properties from the Transferor Companies to it.

Paragraph 2 (f) of RD Affidavit

The scheme envisages that the merger of the Two Transferor Companies with the Transferee / Resultant Company and demerger of the division of the Demerged Company with the Transferee / Resultant Company shall happen simultaneously. But in that case it remains to have clarity that how the investments held by Khordia Builders Private Limited and Vardhaman Trading Company Private Limited in the Demerged Company , Greenview Tea Co Private Limited shall be addressed . The Transferee / Resultant Company ( Vrindavan Projects Private Limited ) shall be issuing shares to the Transferor Companies , being shareholders of the Demerged Company , according to the exchange ratio , but the transferor companies shall be , at the same time instant , merging with the Transferee Company itself . Therefore no shares should be issued by Vrindavan Projects Private Limited to Khordia Builders Private Limited and Vardhaman Trading Company Private Limited . The Scheme is ambigious in this regard .

Paragraph 2 (f) of the Rejoinder

The Deponent duly authorized hereby undertakes that upon coming into effect of the Scheme no equity shares of the Transferee / Resultant Company will be allotted by the Transferee / Resultant Company in respect of 40,000 equity shares of Greenview Tea Co Private Limited held by Khordia Builders Private Limited and 39,000 equity shares of Greenview Tea Co Private Limited held by Vardhaman Trading Company Private Limited transferred to and vested in Transferee / Resultant Company upon amalgamation of the said Transferor Companies .

Paragraph 2 (g) of RD Affidavit

The Hon'ble Tribunal may kindly direct the Petitioners to file an affidavit the extent that the Scheme enclosed to the Company Application and Company Petition are one and same and there is no discrepancy or no change is made.

Paragraph 2 (g) of the Rejoinder

The Deponent duly authorised by the Petitioner Companies hereby affirms that the Scheme enclosed to the Company Application and Company Petition are one and same and there is no discrepancy or no change is made.

Paragraph 2 (h) of RD Affidavit

It is submitted that as per instructions of the Ministry of Corporate Affairs, New Delhi, a copy of the scheme was forwarded to the Income Tax Department on 26/10/2021 with a request to forward their comments / observations / objections, however the same is still awaited.

Paragraph 2 (h) of the Rejoinder

The Income Tax authorities have not made any observations on notice served by the office of the Regional Director.

Further the Petitioner Companies have also complied with the directions contained in the order passed by the Hon’ble Tribunal in the dispensation order and direction order and have effected service upon the Income Tax Department. However the said department have not made/ filed observation pursuant to the said notices filed by the Petitioner Companies.

The Learned Counsel for the Petitioner(s) further submits that in compliance with directions contained in the order dated 19th May,2022 passed by the Guwahati Bench of this Tribunal the Petitioner Company and Non Petitioner Companies have all agreed to shift the Appointed Date from 01st April , 2019 to 01st April, 2021.

The Petitioners have filed affidavit duly affirmed on 22nd June, 2022 annexing Board Resolution for shifting of Appointed Date from 01st April, 2019 to 01st April,2021 in compliance with the direction of the order dated 19-05-2022 of Guwahati Bench of this Tribunal.

Heard the submissions made by the Ld Counsel appearing for the Petitioner and the JD appearing for the RD(ER). Upon perusing the records and documents in the instant proceedings and considering the submissions, we allow the petition and make the following orders:-

i. The Scheme of Arrangement mentioned in this Petition regarding the Investment division of the Demerged company and the amalgamation thereof with the resulting company (Vrindanvan Projects Private Limited) as contained in the Composite scheme, is hereby sanctioned by this Tribunal with Appointed date as 1st day of April, 2021 on Vrindavan Projects Private Limited, and Greenview Tea company (resulting company) and their shareholders and all concerned subject to the sanctioning of the other part of the composite scheme relating to the Infracare Systems Private Limited, Khordia Builders Private Limited and Vardhaman Trading Company Private Limited by NCLT Guwahati in so far as the companies in its jurisdiction are concerned.

ii. The Appointed Date stands shifted from 1st day of April, 2019 to 01st April, 2021 and the same shall be read accordingly wherever the same is appearing in the Scheme in compliance with the directions given by NCLT Guwahati Bench on 19.05.2022 in CP(CAA) 3/GB/2022.

IN RELATION TO DEMERGER IN SECTION - B

iii. All  the  properties,  rights  and  interest  of  INVESTMENT DIVISION of GREENVIEW TEA COMPANY PRIVATE LIMITED - DEMERGED COMPANY be transferred to and vested in without further act or deed in VRINDAVAN PROJECTS PRIVATE LIMITED –RESULTING COMPANY and accordingly the same shall pursuant to Section 232 of the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016 be transferred to and vested in VRINDAVAN PROJECTS PRIVATE LIMITED – RESULTING COMPANY for all the estate and interest of Investment Division of GREENVIEW TEA COMPANY PRIVATE LIMITED - DEMERGED COMPANY but subject nevertheless to all charges, now affecting the same;

iv. All the liabilities and duties in relation to INVESTMENT DIVISION of GREENVIEW TEA COMPANY PRIVATE LIMITED – DEMERGED COMPANY be transferred without further act or deed to VRINDAVAN PROJECTS PRIVATE LIMITED – RESULTING COMPANY and accordingly the same shall pursuant to Section 232 of the Companies Act, 2013 and read with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016 be transferred to and become the liabilities and duties of VRINDAVAN PROJECTS PRIVATE LIMITED – RESULTING COMPANY;

v. That all the proceedings and/or suit appeals now pending by or against or in relation to Investment Division Of Greenview Tea Company Private Limited - Demerged Company Shall Be Continued By Or Against Vrindavan Projects Private Limited – Resulting Company;

vi. ALLOTMENT OF SHARES :

VRINDAVAN PROJECTS PRIVATE LIMITED–RESULTING COMPANY cum TRANSFEREE COMPANY do issue and allot shares to the shareholders of GREENVIEW TEA COMPANY PRIVATE LIMITED - DEMERGED COMPANY as envisaged in the Composite Scheme of Arrangement and for that, if necessary, VRINDAVAN PROJECTS PRIVATE LIMITED–RESULTING COMPANY cum TRANSFEREE COMPANY will increase the authorized share capital.

Upon coming into effect of the Scheme no equity shares of the Transferee / Resultant Company will be allotted by the Transferee / Resultant Company in respect of 40,000 equity shares of Greenview Tea Co Private Limited held by Khordia Builders Private Limited and 39,000 equity shares of Greenview Tea Co Private Limited held by Vardhaman Trading Company Private Limited transferred to and vested in Transferee / Resultant Company upon amalgamation of the said Transferor Companies .

vii. FILING SCHEDULE OF ASSETS AND LIABILITIES

The schedule of assets and liabilities relating to INVESTMENT DIVISION of Greenview Tea Company Private Limited - Demerged Company Shall Be Filed by Vrindavan Projects Private Limited–Resulting Company in SECTION B of the Scheme within a period of 60 days from the date of the order to be made herein.

viii. FILING OF CERTIFIED COPY OF ORDER

Greenview Tea Company Private Limited - Demerged Company And Vrindavan Projects Private Limited –Transferee Company Cum Resulting Company shall within 30 days (effective date) after the date of obtaining the Certified Copy of the order to be made herein cause certified copies of this order to be delivered to the Registrar of Companies, Shillong and Registrar of Companies, Kolkata for registration respectively;

ix. Any person interested be at liberty to apply to this Tribunal in the above matter for any direction that may be necessary;

In case of any default, including any provisions of Income Tax in respect of transferor companies, the Income Tax Department, the ROC West Bengal and all others, statutory departments/authorities shall be at liberty to initiate appropriate proceedings against the TRANSFEREE which after the sanction of the scheme by this tribunal is in any case shall be responsible for the liabilities/non-compliances of the transferor companies as well.

The Petitioner(s) shall supply legible print out of the scheme and schedule of assets and liabilities in acceptable form to the department and the department will append such printout, upon verification to the certified copy of the order.

The Company Petition C.P (CAA) No. 71/ KB / 2022 connected with Company Application C.A(CAA) No 110 / KB / 2021 is disposed of accordingly.

Urgent certified copy of this order, if applied for, be supplied to the parties, subject to compliance with all requisite formalities.