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Judgment
Ajay Kumar Vatsavayi, Member (Judicial)
This is a joint Second Motion Petition under Sections 230 and 232 of the Companies Act, 2013 (for short to be referred hereinafter as the
‘Act’) filed by the Petitioner Companies in terms of Rule 15 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016
(for brevity, ‘Rules’) for the sanction of Scheme of Amalgamation (for brevity ‘Scheme’) of Vidhyut Metallic Tubings Private Limited
(Transferor Company) and Vidhyut Steel Tubes Industries Private Limited (Transferee Company) jointly described as ‘Petitioner Companies’.
The joint petition is maintainable in terms of Rule 3(2) of the Rules.
The Petitioner Companies filed First Motion Application CA (CAA) No.22/Chd/Hry/2019 before this Tribunal for seeking dispensing with the
meetings of the Shareholders, Secured and Unsecured Creditors of all the Applicant Companies and based on such joint application moved under
Sections 230-232 of the Companies Act, 2013, (for brevity, the ‘Act’) necessary directions were issued on 04.03.2020 in which meetings of
Equity Shareholders and Unsecured Creditors of both the Applicant Companies were dispensed off. Copy of the Order dated 04.03.2020 passed in the
First Motion Application is attached as Annexure A-10 of petition.
When the petition was listed on 05.06.2020, following order was passed:-
The petition be listed for hearing on 18.08.2020. Notice of hearing be advertised in “Financial Express†(English) and “Jansatta†(Hindi) both Haryana
Edition not less than 10 days before the aforesaid date fixed for hearing.
Notice be also served upon the Objector(s) or their representatives as contemplated under sub-section (4) of Section 230 of the Act who may have made
representation and who have desired to be heard in their representation along with a copy of the petition and the annexures filed therewith at least 15 days
before the date fixed for hearing. It be specified in the notices that the objections, if any, to the Scheme contemplated by the authorities to whom notice has been
given on or before the date of hearing fixed herein may be filed, failing which it will be considered that there is no objection to the approval of the Scheme on the
part of the authorities by this Tribunal and subject to other conditions being satisfied as may be applicable under the Companies Act, 2013 and relevant rules
framed thereunder.
In addition to the above public notice, each of the Petitioner shall serve the notice of the petition on the following Authorities namely, (a) Central Government
through Regional Director (Northern Region), Ministry of Corporate Affairs, (b) Registrar of Companies, NCT of Delhi & Haryana, (c) the Official Liquidator
(attached to High Court of Punjab and Haryana at Chandigarh) (d) Income Tax Department through the Nodal Officer- Principal Chief Commissioner of Income
Tax, Aaykar Bhawan, Sector 17-E, Chandigarh and by mentioning the PAN of the Companies, along with copy of this Petition by speed post and to such other
Sectoral Regulator(s) who may govern the working of the respective companies involved in the ‘Scheme’.
The petitioner-companies shall at least 7 days before the date of hearing of the petition file an affidavit of service regarding paper publication as well as service
of notices on the authorities specified above including the sectoral regulator as well as to objectors, if any. Objections, if any, to the ‘Scheme’ contemplated
by the authorities to whom notice has been given on or before the date of hearing fixed herein may be filed, failing which it will be considered that there is no
objection to the approval of the ‘Scheme’ on the part of the authorities by this Tribunal and subject to other condition being satisfied as may be applicable
under the Companies Act, 2013 and relevant rules framed thereunder. Registry shall also report before the date fixed as to whether any objection has been
received to the proposed ‘Scheme’.
The affidavit of compliance by the Director of both the Petitioner Companies was filed vide Diary No. 00782/1 dated 10.08.2020 along with copies
of the newspaper publications in “Financial Express†(English) and “Jansatta†(Hindi) Haryana Edition both dated 15.07.2020, attached as
Annexure A. Copies of proof of service of notice to the statutory authorities, i.e. (a) Central Government through Regional Director (Northern
Region), Ministry of Corporate Affairs, (b) Registrar of Companies, NCT of Delhi & Haryana, (c) the Official Liquidator, attached to Punjab and
Haryana High Court (d) Income Tax Department through the Nodal Officer- Principal Chief Commissioner of Income Tax, Aaykar Bhawan, Sector
17-E, Chandigarh and by mentioning the PAN of the Companies, as well as the postal receipts are at Annexure B,C,D & E (Colly). It is deposed that
no objection has been received from any of the Applicant Companies, till date. The Registry has also reported that no objections has been received as
per order dated 05.06.2020.
It is deposed that apart from the above stated authorities, there are no other sectoral regulators in both the Petitioner Companies. Affidavits in this
regard are attached as Annexure A4 & A7 respectively. The certificate of the Statutory Auditor of the Transferee Company certifying that the
accounting treatment proposed in the Scheme is in compliance with the accounting standards prescribed under Section 133 of the Companies Act,
2013 read with relevant rules issued thereunder and other Generally Accepted Accounting Principles was filed with First Motion Application as
Annexure A-24.
The audited financials for the year ended 31.03.2019 along with the provisional statements as on 01.04.2019 of the Transferor Company and the
Transferee Company have been attached as Annexure A2, A5 & A9 of this petition.
The main objects, authorized, issued and paid up share capital, rationale of the Scheme and interest of employees have been discussed in detail in
the Order disposing of the First Motion Application on 04.03.2020.
It is stated in Clause 6.2 of the Scheme that if any suit, writ petition, appeal, revision or other proceedings of whatsoever nature (hereinafter called
“the proceedings’) by or against the Transferor Company is pending, the same shall not abate, be discontinued or be in any way prejudicially
affected by reason of the transfer of the business of the Transferor Company or because of anything contained in the Scheme, but the proceedings
may be continued, prosecuted and enforced by or against the Transferee Company in the same manner and to the same extent as it would or might
have been continued, prosecuted and enforced by or against the Transferor Company as if the Scheme had not been made.
The Scheme (Clause 5) also takes care of the interest of employees. From the relevant clauses of the Scheme there seems to be no adverse impact
on the service conditions of the employees of the Transferor Company.
We have heard the Learned Counsel for the Petitioners, Official Liquidator, Registrar of Companies, Regional Director, Northern Region and the
Income Tax Department & have perused the records.
The Regional Director (RD) has filed its report vide Diary No. 00782/3 dated 11.03.2021 along with the report of the Registrar of Companies
(RoC). The observations are as under:-
(a) In para 10 of the RD report, it is stated that as per the RoC report, both the Transferor & Transferee Company have filed their Balance Sheet and Annual Return up
to 31.03.2020. It is also stated that no prosecution has been filed & no inspection or investigation has been conducted in respect of the petitioner companies.
(b) In para 11 of the RD report, it is submitted that as per Para 32 of the report of ROC, it is observed that while referring to Clause 12 of the Scheme, the Transferee
Company shall comply with the provision of Section 232 (3) (i) of the Companies Act, 2013 and pay the difference fee on consolidated authorized share capital of
Transferee Company, after setting off the fee already paid by the Transferor Companies on their respective authorized capital.
In response to the RD report, the petitioner companies have filed an affidavit vide Diary No. 00782/5, dated 15.07.2021, wherein it is stated that
the Transferee Company undertakes that they will comply with Section 232 (3) (i) of the Companies Act, 2013 and pay the difference fee on
consolidated authorized share capital of Transferee Company, after setting off the fee already paid by the Transferor Company on their respective
authorized capital.
The Official Liquidator (OL) in its report (diary No. 00782/2 dated 18.01.2021) has mainly reiterated the contents of the proposed ‘Scheme’
and has not made any adverse observations or raised any objections to the present Scheme of Amalgamation.
The Income Tax Department (ITD) has filed its report vide Diary No. 00782/4 dated 12.04.2021. It is reported that no outstanding demand/
proceedings are pending in case of the Petitioner Companies with the Income Tax Department. It is also submitted that the Assessment Proceedings
u/s 143(3) of the Income Tax Act, 1961 for the Assessment Year 2019-20 are pending in case of the Transferee Company.
The Petitioner Companies have also attached Valuation Report dated 28.03.2019 (Annexure A8) prepared by Chaitanya Jee Srivastava,
Registered Valuer for which a detailed reference has been made in Para 28 of the Order dated 05.11.2019 (Annexure A21).
As per the Scheme, the Appointed Date means the opening of business hours on 01.04.2019.
In view of the above, there is no impediment in the approval of the ‘Scheme’. The Scheme (Annexure A1) is hereby approved. While
approving the Scheme, it is clarified that this Order should not be construed as an Order in any way granting exemption from payment of any stamp
duty, taxes or any other charges, if any, and payment in accordance with law or in respect of any permission /compliance with any other requirement
which may be specifically required under any law. With the sanction of the ‘Scheme’, the Transferor Company shall stand dissolved without
undergoing the process of winding up resulting in increase in the share capital of the Transferee Company.
AND THIS TRIBUNAL DOES FURTHER ORDER:
i) That all the property, rights and powers of the Transferor Company be transferred, without further act or deed, to the Transferee Company and accordingly, the
same shall pursuant to sections 230 to 232 of the Companies Act, 2013, be transferred to and vested in the Transferee Company for all the estate and interest of the
Transferor Company but subject nevertheless to all charges now affecting the same; and
ii) That all the liabilities and duties of the Transferor Company be transferred, without further act or deed, to the Transferee Company and accordingly the same
shall pursuant to Sections 230 to 232 of the Companies Act, 2013, be transferred to and become the liabilities and duties of the Transferee Company; and
iii) That all the proceedings now pending by or against the Transferor Company be continued by or against the Transferee Company; and
iv) That the employees of the Transferor Company shall be transferred to the Transferee Company in terms of the ‘Scheme’; and
v) That the Transferee Company shall, without further application, allot to the existing members of the Transferor Company shares of the Transferee Company to
which they are entitled under the said Scheme of Amalgamation: and
vi) That the fee, if any, paid by the Transferor Company on its authorized capital shall be set off against any fees payable by the Transferee Company on its
authorized capital subsequent to the sanction of the ‘Scheme’; and
vii) That the Petitioner Companies do, within 30 days after the date of receipt of this Order, cause a certified copy of this Order to be delivered to the Registrar of
Companies for registration and on such certified copy being so delivered, the Transferor Company shall be dissolved without undergoing the process of winding up.
The concerned Registrar of Companies shall place all documents relating to the Transferor Company registered with him on the file relating to the said Transferee
Company and the files relating to the Transferor and Transferee Companies shall be consolidated accordingly, as the case may be;
viii) That the Transferee Company shall deposit an amount of ₹75,000/- with the Pay & Accounts Office in respect of the Regional Director, Northern Region,
Ministry of Corporate Affairs, New Delhi, and ₹25,000/- in favour of “The Company Law Bar Associationâ€, Chandigarh within a period of four weeks from the
date of receipt of certified copy of this Order; and
ix) That any person interested shall be at liberty to apply to the Tribunal in the above matter for any directions that may be necessary.
As per the above directions, Form No.CAA-7 of Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, formal orders be
issued on the petitioners on filing of the Schedule of Property i.e. (i) freehold property of the Transferor Company and (ii) leasehold property of the
Transferor Company by way of affidavit of the Transferor Company respectively.
Copy of this order be communicated to the Counsel for the Petitioners.