JB Technologies Private Limited Vs

Heard learned counsel for parties as well as the Authorized Representative of the Regional Director . No objector has come before this Tribunal to oppose this Scheme of Amalgamation nor has any party contravened any averments made in this Petition, except otherwise stated hereunder.

The sanction of this Tribunal is sought under Sections 232 r/w Section 230 of the Companies Act, 2013, to a Scheme of Amalgamation of JB Technologies Private Limited (“Transferor Company”) with SM Dyechem Limited (“Transferee Company”) and their respective Shareholders (“Scheme of Amalgamation”/ “Scheme”)

The Petitioner Companies have approved the said Scheme of Amalgamation by passing the respective Board Resolutions dated 10thOctober, 2022 which are annexed to the Company Scheme Petition.

The Petition have been filed in consonance with the order dated 11th October, 2023 passed in their Company Scheme Application No. 51 of 2023 by the National Company Law Tribunal.

The Petitioner Companies are companies belonging to the same group. The Transferor Company is engaged in the business of providing computer software and hardware services. The Transferee Company was formed with an object to carry on business of manufacturing of meal &oil, snack foods and speciality chemicals. The merger will ensure creation of a combined entity hosting all value-added product and services under the Transferee Company, as holding entity of the cluster. It will provide several benefits including but not limited to synergy, economies of scale, attain operational efficiencies, cost competitiveness etc. it is intended that the Petitioner Transferor Company be merged with Petitioner Transferee Company.

The merger and other provisions of the Scheme would benefit the shareholders, employees and other stakeholders of the Transferor Transferee Companies.

The Petitioner Companies have complied with all requirements as per directions of this National Company Law Tribunal, Mumbai Bench in C.A.(CAA)/51/2023 vide order dated 11.10.2023 and they have filed necessary Affidavits of compliance in this Tribunal. Moreover, the Petitioner Companies undertakes to comply with all statutory requirements, if any, as required under the Companies Act, 2013 and the Rules made there under whichever is applicable.

The Tribunal had vide, its order dated 11th October, 2023 ordered dispensation for meetings of Equity shareholders. There were no Secured Creditors in the Transferor Company as on the cut-off date. The Transferee Company has One Secured Creditor to whom Notice was sent as directed by Tribunal. Notices were sent to all the Unsecured Creditors on the cut-off date of the Transferor Company and Transferee Company as directed by the Tribunal. None of the creditors have appeared to oppose the scheme.

Consideration:

Upon coming into effect of this Scheme and in consideration of the merger of the Transferor Company into and with the Transferee Company, the Transferee Company shall, without any further application, act or deed, issue and allot to the shareholders of the Transferor Company whose names are recorded in the register of members as a member of the Transferor Company, including register and index of beneficial owners maintained by a depository under Section 11 of the Depositories Act, 1996, if any, on the Record Date (or to such of their respective heirs, executors, administrators or other legal representatives or other successors in title as may be recognised by the Board of the Transferee Company) (“Eligible Member”) in the following ratio (“Share Exchange Ratio”):

“6409 (Six Thousand Four Hundred and Nine) fully paid-up equity shares of Rs. 2/- (Rupees Two Only) each of the Transferee Company shall be issued and allotted for every 2 (Two) fully paid-up equity shares of Rs. 10/- each held in the Transferor Company.”

The Regional Director has filed his Report dated 08.04.2024 making certain observations and the Petitioner Companies have undertaken/made following submission that :

i.That there are no pending inquiry, inspection, investigations and prosecutions and complaint under Companies Act, against the Petitioner Companies;

ii.In terms of the Scheme, the Transferee Company will take over the assets and liabilities of the Transferor Company, post amalgamation, and the Transferee;

iii.The interest of the creditors will be protected;

iv.The Petitioner Transferee Company shall resolve complaint the filed by Mr. V Sachithanandam regarding non-receipt of Share Certificate pursuant to conversion of Debenture Certificate/ Trade Warrants complaint in accordance with law. In any event, the present scheme will have no impact on the said complaints since they are directed against Transferee which continues to remain in existence after the scheme becomes effective;

v.The stamp duties and fees paid on the authorised share capital of the Transferor Company shall be utilized and applied to the increased authorised share capital of the Transferee Company and no extra stamp duty and/or fees shall be required to be paid by the Transferee Company for its increased authorised share capital;

vi.The Petitioner Companies have complied with the requirements as clarified vide circular no. F. No. 7/12/2019/CL-I dated 21.08.2019 issued by the Ministry of Corporate Affairs;

vii.The Scheme enclosed to the Company Application and the Scheme enclosed to the Company Petition are one and same and there is no discrepancy or deviation;

viii.The Transferee Company will comply with Income Tax Provisions in relation to proceedings/claims under Income Tax Act against the Transferor Company;

ix.The Transferee Company shall comply with the provisions of Section 90 of Companies Act, 2013 r/w. Companies (Significant Beneficial Owners) Amendment Rules, 2019, thereunder and to file Form BEN – 2 for declaring name of the significant beneficial Owner with the concerned ROC.

Mr. Bhagwati Prasad, Deputy Director, Office of Regional Director (WR), Mumbai appeared on the date of hearing and submits that the explanations and clarifications given by the Petitioner Companies in rejoinder are satisfactory and they have no further objection to the Scheme.

The Official Liquidator has filed his report dated 10th January, 2024 inter alia, stating therein in Paragraph 6 of the said Report. The Official Liquidator has stated as follows:

i. The Petitioner companies submits that as per RBI circular no. DNBS (PD) C.C. No. 81 / 03.05.002/ 2006-07, dated October 19, 2006 “The Company will be treated as a non banking financial Company, (NBFC) if its financial assets are more than 50 per cent of its total assets (netted off by intangible assets), and income from the financial assets, is more than 50% of the gross income. Both these tests are required to be satisfied as the determinant factor for the principal business of a company.”

ii. In the financial year 2021-22 the Transferor Company had sold one of its non-financial asset (i.e. Property) and profit from the sale of above property, i.e, non-financial asset is shown under Revenue from Operations. Thus, the major revenue in the said year is from the sale of property which is non-financial income. Hence, as the income from the financial assets, is less than 50% of the gross income, the Transferor Company will not be considered as deemed NBFC and the provisions of Section 45-IA of Reserve Bank of India Act will not apply to the Transferor Company.

We have considered the submissions made by the Petitioner Company before the Official Liquidator and is of the considered view the observations are in order and does not have any bearing on the sanction of present scheme.

From the material on record, the Scheme of Amalgamation appears to be fair and reasonable and is not violative of any provisions of law and is not contrary to public policy considering that no objection has been received from any authority or creditors or members or any other stakeholders.

The Income Tax Department will be at liberty to examine the aspect of any tax payable as a result of this scheme and in case it is found that the scheme ultimately results in tax avoidance under the provisions of Income Tax Act, it shall be open to the Income tax authorities to take necessary action as possible under the Income Tax Law.

The said Scheme of Amalgamation is hereby sanctioned with the Appointed Date fixed as April 1, 2021,declared the same to be binding on the Petitioner Transferor Company and Petitioner Transferee Company and their respective Shareholders. The First Petitioner Company be dissolved without winding up.

The Petitioner Companies are directed to file a copy of this Order along with a copy of the Scheme with the concerned Registrar of Companies, within 30 days from the date of receipt of the certified copy of this Order by the Petitioner Companies.

The Petitioner Companies to lodge a copy of this Order along with the Scheme duly authenticated/certified by the Deputy Director or the Assistant Registrar, National Company Law Tribunal, Mumbai Bench, with the concerned Superintendent of Stamps for the purpose of adjudication of stamp duty payable, if any, within 60 days from the date of receipt of the certified Order from the Registry of this Tribunal.

All concerned regulatory authorities to act on a copy of this Order along with Scheme duly certified by the Deputy Director or the Assistant Registrar, National Company Law Tribunal, Mumbai Bench.

Ordered accordingly. File to be consigned to records.