In Re: Vectra Auto Components Private Limited

H. Billappa, J.—The petitioner Transferor company has filed this petition praying for sanction of the scheme of amalgamation with the Transferee Company namely, Vectra Investments Private Limited without winding up.

It is stated, the petitioner Transferor company was incorporated on 22.05.1992 having its registered office at No. 15, 1st main, Gandhinagar, Bangalore-560 009. The share capital of the petitioner Transferor company as on 31.03.2013 was Rs. 8,00,00,000/- (Rupees Eight Crores only) divided into 20,000/- equity shares of Rs. 10/- each. The issued, subscribed and paid-up share capital of the company was Rs. 8,00,00,000/- divided into 20,000/- equity share of Rs. 100/- each fully paid-up and 78,00,000/- equity shares of Rs. 10/- each fully paid-up. The audited balance sheet for the financial year ended on 313.2013 is at Annexure ''C.

It is stated, the Transferee company was incorporated on 10.10.1997 having its registered office situated at ''Vectra House'', No. 15, 1st mam road, Gandhinagar, Bangalore-560 009. The transferee company is engaged in the business of investment in all its branches and dealing in acquiring, underwriting, investing in and acquire, hold and lease, sell and otherwise deal in shares, debentures, stock, bonds and obligation and securities of every kind.

It is stated, the Board of directors of the Transferor company have passed a resolution dated 09.07.2013 approving and adopting the scheme of amalgamation of the Transferor company with the Transferee company.

It is stated, the Transferor company is a 100% wholly owned subsidiary company of the Transferee company and the entire share capital of the Transferor company is currently held by the Transferee company.

It is stated, the Transferor company had filed CA No. 523 of 2014 for dispensation of holding of the meeting of the shareholders and the creditors and also for dispensation of filing separate application and petition in respect of the Transferee Company. The said application was allowed by order dated 22.04.2014. Thereafter, by order dated 17.07.2014 this Court directed notice to the Regional Director and also the Official Liquidator. Further, directed the Transferor company to take out paper publication in ''The Hindu'' and ''Udayavani'' news papers, Bengaluru edition. Accordingly, the paper publication on 30.7.2014 in ''The Hindu'' and T. Jdayavani'' newspapers. Nobody has appeared to resist the petition.

It is stated, this Court by its order dated 21.08.2014 passed in OLR No. 390 of 2014 appointed M/s. T. Gandhi and company, Chartered Accountants to scrutinize and verify the books of accounts and records of the Transferor company. The Official Liquidator has filed OLR No. 521 of 2014 based on the report of the Chartered Accountants stating that the Transferor company may be dissolved without winding up.

The Registrar of Companies has filed an affidavit dated 03.12.2014 on behalf of the Regional director, ministry of corporate affairs, south east region, Hyderabad, stating that notice dated 11.08.2014 was issued to the Income Tax Department and the Deputy Commissioner of Income Tax, circle-11(5), Bengaluru vide letter dated 04.09.2014 has observed that no arrears of tax are pending against M/s. Vectra Auto Components Private Limited and M/s. Vectra Investments Private Limited. In the case of Vectra Investments Private Limited scrutiny assessment under section 143 (3) of the Income Tax Act, 1961 is pending which gets time barred on 31.03.2015.

Further, it is stated, the Assistant General Manager, Reserve Bank of India, Bengaluru vide letter dated 14.11.2014 has observed that they have no objections to the proposed scheme of amalgamation of M/s. Veetra Auto Components Private Limited with M/s. Vectra Investments Private Ltd. Further, it is observed that the petitioner Transferor company is required to clarify as to whether the petitioner Transferor company has filed its annual return till the financial year 31.03.2013. Non-compliance of Section-383-A by the Transferor company for a long, despite the capital work in progress of Rs. 2.40 crores the Transferor company has to file compounding application before the merger is effected, since after the merger, the prosecution for violation cannot be launched. It is stated, the capital work in progress of Rs. 2.40 crores has become redundant due to closure of automobile business of Transferor company ought to have been written off This was not done leading to violation of Section-211 read with Schedule-VI, Part-I for which the Transferor company needed to file compounding application. It is also not clear as to how capital work in progress went up from Rs. 2.16 to Rs. 2.40 crores when the Transferor company claims that it did not do any business during the last few years.

Further, it is observed that the appointed date also needs to be shifted from 01.04.2013 to 01.04.2014 as the last financial year had ended long ago. It is stated that on verification from the records of MCA-21 portal, the Transferor company has not filed its published balance sheets for the financial years 2012-13 and 2013-14 and it has also not filed its published balance sheet for the year ending 31.03.2014. It is stated, both the companies have requested for extension of their annual general meetings for the financial year 2013-14 and the same has been rejected by the Registrar of Companies, Karnataka.

The petitioner Transferor company has filed an affidavit dated 12.06.2015 explaining all the observations made by the Registrar of Companies in their affidavit dated 03.12.2014.

The learned counsel for the petitioner submits that the annual return till the financial year ending up to 31.03.2014 have been submitted and in so far as the capital work in progress of Rs. 2.40 crores is concerned, it is explained in the affidavit that the appointed date can be reckoned from 01.04.2013 as the Transferor company is a 100% wholly owned subsidiary company of the Transferee company. It is stated, in respect of the observation (v) of the Registrar of Companies, the same has been complied with by filing compounding application and it has been accepted.

In the additional affidavit dated 21.07.2015 filed by the Registrar of Companies, it is stated that the capital work in progress on sale, if not fetched the price beyond Rs. 2.40 crores, it will be prejudicial to the interest of the Transferee company.

The learned counsel for the petitioner Transferor company submits that the Transferor company is the wholly owned subsidiary company of the Transferee company and therefore, the interest of the Transferee company will not be prejudiced in anyway.

In the above circumstances and the explanation offered by the Transferor company in the affidavit dated 12.6.2015 for the observations made by the Registrar of Companies and keeping in view the submission of the learned counsel for the Transferor company and the Transferor company is wholly owned subsidiary company of the Transferee company the scheme as per Annexure-A can be sanctioned without winding up, subject to compliance of statutory requirements of law.

Accordingly, the following order is passed:

"The company petition is allowed. The scheme of amalgamation vide Annexure-A is hereby sanctioned subject to the compliance of all the requirements of law. The petitioner Transferor company stands dissolved without winding up and in terms of the scheme of amalgamation. The petitioner Transferor company and the Transferee company are directed to file the copy of this order with the Registrar of Companies, Karnataka within 30 days."