AI Structured Summary
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Judgment
,,,,,,,,
Subrata Kumar Dash, Member (Technical)",,,,,,,,
This is a joint First Motion Application filed by Applicant Companies namely; Peoplestrong Technologies Private Limited (Applicant Company,,,,,,,,
1/Demerged Company) and Talenthired-The job Store Private Limited (Applicant Company 2/Resulting Company) under Section 230-232 of,,,,,,,,
Companies Act, 2013 (the Act) and other applicable provisions of the Act read with Companies (Compromises, Arrangements and Amalgamation)",,,,,,,,
Rules, 2016 in relation to the Scheme of Arrangement between the Applicant Companies. The said Scheme is also attached as Annexure A-3 of the",,,,,,,,
Application.,,,,,,,,
The Applicant Companies have prayed for dispensing with the requirement for convening the meeting of the equity shareholders, Secured and",,,,,,,,
Unsecured Creditors of the Applicant Companies and of preference shareholders of Applicant Company 1/Demerged Company.,,,,,,,,
The Applicant Company 1/Demerged Company is presently engaged in the business of designing, development, customisation, implementation,",,,,,,,,
maintenance, testing, benchmarking and dealing in technology Software and solutions, and to import, export, sell, purchase, distribute, host (in data",,,,,,,,
centres of over the web) or otherwise deal in own and third party computer software packages, programs and solutions, and to provide internet / web",,,,,,,,
based applications, services and solutions, provide or take up Information Technology related assignments on contracting or subcontracting basis,",,,,,,,,
offering services on-site/offsite or through development centres using owned / hired or third party infrastructure and equipment, to undertake IT",,,,,,,,
enabled services like data processing, Back office processing, HR and payroll processing, data warehousing and database management and Applicant",,,,,,,,
Company 2 /Resulting Company is presently engaged in the business of providing or outsourcing manpower placement and recruiting, Selecting,",,,,,,,,
Interviewing, Training and employing all types of executives, Middle Management Staff, junior Level Staff, workers, Labourers Skilled/Unskilled",,,,,,,,
required by various Industries and organizations including provisioning security services, Labour Contractors, Industrial, Commercial, Housing and",,,,,,,,
other security services.,,,,,,,,
It is submitted that the registered office of the Demerged Company and Resulting Company is at A-10, Infocity I, Sector-34, Gurgaon, Haryana",,,,,,,,
which is situated in the State of Haryana and, therefore, both applicant companies falls within the territorial jurisdiction of this Bench.",,,,,,,,
The rationale of the scheme is given below:-,,,,,,,,
a) Enhanced focus on the operations resulting from separate management teams, who can chart out their own independent strategies to facilitate business growth.",,,,,,,,
b) Increased focus on the respective businesses in order to better meet their respective customers' needs and resulting in deeper market penetration, develop their",,,,,,,,
own network of alliances and talent models that are critical to their own success.,,,,,,,,
c) Rationalization of operations with greater degree of operational efficiency and optimum utilization of various resources.,,,,,,,,
d) Investors/ Shareholders will be able to separately hold investments which will best suit their investment strategies and risk profiles. It will lead to creation and,,,,,,,,
enhancement of stakeholders’ value by unlocking the intrinsic value of different businesses.,,,,,,,,
e) Ability to leverage financial and operational resources separately for each business, if required.",,,,,,,,
f) Each business will be able to address independent business opportunities with efficient capital allocation and attract different set of investors, strategic partners,",,,,,,,,
and other stakeholders, thus leading to enhanced value creation for shareholders, which would be in the best interest of the Demerged Company and Resulting",,,,,,,,
Company and their respective stakeholders connected therewith.,,,,,,,,
It is stated that the Board of Directors of the Demerged Company and Resulting Company in their respective meetings held on 21.05.2021 have,,,,,,,,
considered and approved the Scheme of Arrangement subject to sanctioning of the same by this Tribunal. The copy of the Board Resolutions of the,,,,,,,,
Demerged Company and Resulting Company are attached as Annexure A-5 of the application. Applicant Company 1 and Applicant Company 2 have,,,,,,,,
authorized Mr. Pankaj Bansal, to do all acts and deeds and things in relation to the Scheme. The affidavit of Mr Pankaj Bansal, on behalf of the",,,,,,,,
Demerged and Resulting Company, has been filed in support of the contents of the application for seeking appropriate orders/directions.",,,,,,,,
The appointed date of the Scheme is 01.04.2021 as mentioned in the Clause 1.3 of Scheme of Arrangement attached as Annexure A-3.,,,,,,,,
It is stated that the Demerged Company and Resulting Company have filed the audited financial statements as on 31.03.2020 at Annexure- A-2 of,,,,,,,,
the application. The Demerged and Resulting Company have also filed unaudited financial statements as on 31.03.2021 as Annexure A-2(1) of the,,,,,,,,
application,,,,,,,,
It is submitted that no investigation or proceedings under the Companies Act, 2013 or the Companies Act, 1956 are pending against the Applicant",,,,,,,,
Companies.,,,,,,,,
It is submitted that in pursuance of the proviso to Sec. 230 (7) and Section 232 (3) of the Act, the Applicant Company has filed the certificate",,,,,,,,
dated 21.05.2021 issued by Statutory Auditors of Applicant Companies certifying that the Scheme is in compliance with the Accounting Standards,,,,,,,,
under Section 133 of the Act and the same is attached as Annexure A-15 of the application.,,,,,,,,
It is further submitted by the counsel for applicant companies that as per Valuation Report dated 10.05.2021 submitted by Mr. Punit Khandelwal,",,,,,,,,
Director of Incwert Advisory Private Limited (Annexure A-7 of the application) the following Share Exchange Ratio has been proposed:-,,,,,,,,
“1(one) equity share of the Resulting Company of face value of INR 1 each fully paid up held in the Demerged Company. 1(one) compulsory convertible,,,,,,,,
preference share of the Resulting Company of face value of INR 1 each fully paid up shall be issued for ever 1(one) compulsorily convertible preference share of,,,,,,,,
INR 1 each fully paid up held in the Demerged Company.â€,,,,,,,,
It is submitted by the learned counsel that the Scheme (Annexure A3) also takes care of the interests of the staff/workers and employees of the,,,,,,,,
Demerged Companies. By virtue of Clause 9.1, it is stated that Upon the coming into effect of this Scheme, all the employees relating to the",,,,,,,,
Demerged business undertaking that were employed by the Demerged Company, immediately before the Effective Date, shall become the employees",,,,,,,,
of the Resulting Company without any break or interruption of service and with the benefit of continuity of service on terms and conditions which are,,,,,,,,
not less favourable than the terms and conditions as were applicable to such employees relating to the Demerged business undertaking of the,,,,,,,,
Demerged Company immediately prior to the Demerger of the Demerged business undertaking.,,,,,,,,
It is submitted that the proposed scheme is not a corporate debt restructuring scheme as contemplated under section 230(2) (c) of Companies Act,",,,,,,,,
2013. It is further submitted that the investment made by demerged company in the equity Share Capital of Resulting Company shall stands Cancelled,,,,,,,,
which will lead to the reduction of the Equity Share Capital of the Resulting Company. There are no sectoral regulators or authorities other than,,,,,,,,
Central Government/Regional Director, Registrar of Companies and Income Tax Authorities which are affected by the scheme of arrangement.",,,,,,,,
The applicant companies has furnished the following documents,,,,,,,,
i. Proposed Scheme of Arrangement (Annexure A-3 of the application).,,,,,,,,
ii. Copy of Board Resolution of applicant Companies Approving the proposed scheme of Arrangement (Annexure A-5 of the application).,,,,,,,,
iii. List of Secured and Unsecured Creditors duly certified by the Statutory Auditors (Annexure A-9 of the application).,,,,,,,,
Name of the
Applicant
Companies","Shareholders along with their consent on
affidavit",,,,"Creditors along with their consents on
affidavit",,,
,"Equity
Shareholder","Consent
submitted
on
Affidavit","Preference
Shareholder
s",Consent,"Secured
Creditors",Consent,"Unsecured
Creditors","Unsecured
Creditors
Peoplestrong
Technologies
Pvt Ltd",10,10,3,3,1,1,3,3
Talenthired-
The Jobstore
Pvt Ltd",2,2,Nil,Nil,Nil,Nil,Nil,Nil
Accordingly, the directions of this Bench in the present case are as under:-",,,,,,,,
I. In relation to the Applicant Company 1/Demerged Company:,,,,,,,,
a) The meetings of the Equity Shareholders are dispensed with keeping in view the shareholding pattern, financial structure of the company and the fact that the",,,,,,,,
consent by way of affidavit have been received.,,,,,,,,
b) The meetings of the Preference Shareholders are dispensed with as it has three (3) Preference Shareholders and the consent of the same have been received by,,,,,,,,
way of affidavit.,,,,,,,,
c) The meeting of the Secured Creditors of the Applicant Company 1 /Demerged Company is dispensed with as it has only one (1) Secured Creditor and the consent,,,,,,,,
of the same has been received by way of affidavit.,,,,,,,,
d) The meeting of the Unsecured Creditors of the Applicant Company 1/Demerged Company is dispensed with as it has three (3) Unsecured Creditors and the,,,,,,,,
consent of the same have been received by way of affidavit.,,,,,,,,
II. In relation to the Applicant Company 2/Resulting Company:,,,,,,,,
a) The meetings of the Equity Shareholders are dispensed with keeping in view the shareholding pattern, financial structure of the company and the fact that the",,,,,,,,
consent by way of affidavit have been received.,,,,,,,,
b) Since, there are no Secured Creditors in the Applicant Company 2/Resulting Company. Therefore, there is no scope for any meeting.",,,,,,,,
c) Since, there are no Unsecured Creditors in the Applicant Company 2/Resulting Company. Therefore, there is no scope for any meeting.",,,,,,,,
In view of the above, the First Motion Application stands allowed by giving liberty to the Applicant Companies to file Second Motion Petition with",,,,,,,,
a direction that the Applicant Companies shall make specific prayer for sending notices to the Central Government, Registrar of Companies, Official",,,,,,,,
Liquidator and Income Tax Authorities by disclosing the PAN numbers of all the Applicant Companies in the title of the Second Motion Petition and,,,,,,,,
also filing of provisional Balance Sheet upto 30.09.2021 or later along with an affidavit with regard to the Sectoral Regulator governing the Applicant,,,,,,,,
Companies.,,,,,,,,