Thistle Equity Consultant Limited vs Registrar Of Companies

Rajasekhar V. K., Member (Judicial)

The instant petition has been filed under section 230(1) read with section-232(1) of the Companies Act, 2013 along with the Companies

(Compromises, Arrangements and Amalgamations) Rules, 2016 by Vashu Equity Private Limited (Transferor Company No.3/Petitioner Company)

praying for sanctioning of the Scheme of Amalgamation of Thistle Equity Consultant Limited (Transferor Company No.1), Zinnia Equity

Consultant Limited (Transferor Company No.2) and Vashu Equity Private Limited (Transferor Company No.3/Petitioner Company) with Metro

Technobuild Private Limited (Transferee Company) (hereinafter referred to as “Scheme†or “Scheme of Amalgamationâ€).. Separate

Company Petition has been filed before the National Company Law Tribunal (NCLT), New Delhi Bench with respect to Transferor Company No.1, 2

and Transferee Company.

The Petition has now come up for final hearing. Dr UK Chaudhury, Ld. Senior Counsel for the Petitioner Company, submits as follows:-

a. The Board of Directors of the Transferor Company No.3/Petitioner Company has unanimously approved the Scheme of Amalgamation in its

meeting held on 28th February 2021.

b. The factual position of the authorised, issued, subscribed and paid-up share capital of the Petitioner Companies as on 31st March 2020 is described

in the present Company Petition.

Ld Counsel for the Petitioner Company submitted that the circumstances which necessitated the Scheme of Amalgamation are as follows:

a. For the optimum running, growth and development of the business and undertakings of the Transferor Companies and the Transferee Company

with their combined resources and a larger capital and asset base, it is considered desirable and expedient to amalgamate the Transferor Companies

with the Transferee Company in the manner and the terms and conditions stated in this Scheme of Amalgamation.

b. The amalgamation will enable appropriate consolidation and integration of the activities of the Transferor Companies and the Transferee Company

with pooling and more efficient utilisation of their resources, reduction in overheads and other expenses and improvement in various other operating

parameters. The amalgamation will result in the formation of a larger and stronger entity having greater capacity for conducting its operations more

efficiently and competitively. The Scheme is proposed accordingly and will have beneficial results for the Company, their shareholders, employees and

all concerned.

The Petitioner Company have stated that the accounting treatment proposed in the Scheme of Amalgamation is in conformity with the Accounting

Standards prescribed under Section 133 of the Companies Act, 2013 as certified by the Auditors of the Petitioner Company.

It has also been stated in the Petition that no proceedings under Sections 235 to 251 of the Companies Act, 1956 or under Sections 210 to 226 of the

Companies Act, 2013 is pending against the Petitioner Company.

It has also been stated in the Petition that the Scheme is not prejudicial to the interests of the shareholders and creditors of the Petitioner Company

and the Petition is made bona fide and is in the interest of all the Petitioner Company and their respective shareholders and Creditors as a whole and

is just and equitable.

A perusal of the present Petition discloses that initially the Petitioner Companies had filed CA (CAA) No.10/ALD/2021 seeking directions of this

Tribunal to dispense with the requirement of convening meetings of Equity and Preference Shareholders, Secured Creditors and Unsecured Creditors

of the Petitioner Company/ Transferor Company No.3. Accordingly, this Tribunal vide its Order dated 15/07/2021, dispensed with the requirement of

convening meetings of Equity and Preference Shareholders, Secured Creditors and Unsecured Creditors of the Petitioner Company/Transferor

Company No.3.

This Tribunal vide its Order dated 27/07/2021 issued directions to issue notice of hearing in respect of the present Company Petition to the Statutory

Authorities and also to make paper publication in respect thereof in English Newspaper ‘Business Standard’ and Hindi Newspaper

‘Business Standard’ having circulation where registered office of the Petitioner Company is situated.

In compliance thereof, the Petitioner Company on 1st September, 2021 have filed Affidavit of service and publication, confirming that notices have

been duly published in English Newspaper Business Standard and Hindi Newspaper Business Standard, and served upon â€" (a) the Central

Government through the office of the Regional Director (Northern Region), Ministry of Corporate Affairs, New Delhi; (b) the Registrar of

Companies, Uttar Pradesh, Kanpur; (c) the Official Liquidator, Allahabad; and (d) the Income-Tax Department having jurisdiction over the Petitioner

Company.

Pursuant to the said advertisements and notices, the Regional Director (Northern Region), Ministry of Corporate Affairs, New Delhi received a

Report from the Registrar of Companies, Uttar Pradesh, Kanpur and filed its representation on 17/09/2021 through an affidavit whereof the Regional

Director in his report stated that the transferor companies and the transferee companies have filed the Balance Sheets and Annual returns and no

prosecution has been filed and no inspection or investigation has been conducted in respect of the petitioner companies.

The Official Liquidator, Ministry of Corporate Affairs, Allahabad, Uttar Pradesh has also filed its report dated 26.08.2021. At Para 22 thereof, it is

mentioned that the Official Liquidator has no objection to the proposed Scheme.

Ld counsel representing the Income-Tax Department has filed its representation to the effect that the Income-Tax Department has no objection to

the sanction of the proposed Scheme of Amalgamation.

We have heard the learned Senior Counsel appearing for the petitioner, and the representative of the Regional Director (Northern Region),

Ministry of Corporate Affairs, New Delhi. We have also gone through the reports of the regulatory authorities, and the affidavit filed by the Petitioner

Company in response to the report of the Regional Director.

In his report, the Regional Director has stated that the balance sheet of the Petitioner transferor company and non-petitioner companies as on

31.03.2021 shows that the substantial quantum of equity shares are held by the non-petitioner Company and through the process of allotment of shares

and transfer/ acquisition of shares, the entire security premium amount and substantial face value of shares are booked as loss in the books of

respective intermediary allottees and these matters have material impact upon the national exchequer and may fall under the ambit of money

laundering. Further, it has made an observation that as per the latest MoU, the main object of the Petitioner Company No. 3 is to carry out the

business of providing ,designing and engineering services to domestic and international market but from the perusal of the latest financial statements it

is found that the company is following activities of providing long term loans & advances which falls under the ambit of “NBFC†as defined under

RBI Act, 1934 and in the balance sheet for the Financial Year ended on 31.03.2019 and 31.03.2020 the petitioner company has shown revenue from

“ other Income- Interest Income( Interest on long term loans & Advances) is the only source of revenue.

The Petitioner Companies in their Reply Affidavit filed on 30.11.2021, have stated that the transactions of allotment and transfers of shares have

been scrutinised in detail by the Income tax Department on several occasions and that Department has held the transactions to be genuine. It was

further submitted that the transferor/ Petitioner company advanced money received by allotment of shares to its group company, and it has not given

any loan or advance to any outside company. Therefore, the provisions of RBI Act, 1934 are not applicable to the company, since it is not engaged in

NBFC activities. The representative of the Central Government while agreeing to the reply of the Petitioner Companies conveyed no objection to the

sanction of the proposed Scheme of Amalgamation.

Having heard the ld Sr Counsel for the petitioner and the representative of the RD, we find that there appears to be no reservation to grant

sanction to the Scheme and we are of the view that the sanction of the present Scheme is not against public policy, nor it would be prejudicial to the

public interest at large.

In addition to above, all the statutory compliance seems to have been complied with by the Petitioner Company, therefore, the present Company

Petition deserves to be allowed in terms of its prayer clause.

In the result, the proposed Scheme of Amalgamation, which is annexed to the Company Petition stands approved and sanctioned. The Petitioner

Company shall act as per terms and conditions of the sanctioned Scheme and the same shall be binding on all the Shareholders, Secured Creditors and

Unsecured Creditors of the above-named Petitioner Companies and also on the Petitioner Company with effect from the Appointed Date i.e., 1st

April, 2020.

While approving the Scheme as above, it is clarified that this order should not be construed as, in any way, granting exemption from payment of

stamp duty  (if any, is applicable), taxes (including Income Tax, GST or any other charges, if any, are applicable) and payment in

accordance with law or in respect to any permission/ compliance with any other requirement which may be specifically required under any law. Also,

the Transferor Company No.1, Transferor Company No.2 and Transferor Company No.3 shall stand dissolved without undergoing the process of

winding up.

The Petitioner Company shall within thirty days of the date of the receipt of this order cause a certified copy of this order to be delivered to the

Registrar of Companies, Uttar Pradesh for registration.

All the concerned Regulatory Authorities to act on a copy of this order annexed with the Scheme duly authenticated by the Registrar, National

Company Law Tribunal, Allahabad Bench.

Leave is granted to the Petitioner Company to file the Schedule of Assets.

Any person interested shall be at liberty to apply before this Tribunal in the above matter for such directions as may be necessary.

Accordingly, the present CP (CAA) No.09/ALD/2021 is allowed and stands disposed of.