Gajbadan Hotels and Resorts Private Limited Vs

The present Joint Company Petition is filed by the Petitioner Companies above named under Sections 230 & 232 of the Companies Act, 2013, the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, and other applicable provisions, if any, for sanction of the Scheme of Amalgamation of Gajbadan Hotels and Resorts Private Limited (“Petitioner Company No. 1” or “Transferor Company No. 1”), and Vinayak Investment Advisory Private Limited (“Petitioner Company No. 2” or “Transferor Company No. 2”) with Lokdrushti Industries Private Limited (“Petitioner Company No. 3” or “Transferee Company”) (“Scheme” or “Scheme of Amalgamation”).

The Petition has now come up for final hearing. The Ld. Counsel for the Petitioner Companies submits as follows:

(i) The proposed ‘Scheme of Amalgamation’ has previously been approved by the Board of Directors of Petitioner Companies in their respective Board Meetings held on 28th March, 2023.

(ii) The factual position of the Authorized, Issued, Subscribed and Paid-up Share Capital of the Petitioner Companies as on 31st December, 2022 is described in the present Company Petition.

(iii) The rationale of the proposed Scheme of Amalgamation is elaborately described in the present Company Petition which may be summarized as under:

a. The proposed amalgamation will result in achieving business and administrative synergies by the petitioner companies;

b. The proposed Amalgamation would result in cost savings and synergies by rationalization, standardization and simplification of business processes of petitioner companies;

c. The transferee company, after proposed amalgamation would gain improved business capabilities arising from pooling of financial resources;

d. The proposed amalgamation would result in economies of scale of administrative and operational cost, duplication of costs of administration, distribution, selling and marketing and reduction in legal and regulatory compliances; and

e. The proposed amalgamation would enable the petitioner companies for maximization of shareholders value by strengthening core competencies of combined business efforts.

The Petitioners 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 respective Auditors of the Petitioner Companies.

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 are pending against any of the Petitioner Companies.

It has also been stated in the Petition that the Scheme is not prejudicial to the interest of the Shareholders and Creditors of the Petitioner Companies and the Petition is made bona-fide and is in the interest of all the Petitioner Companies and their respective Shareholders and Creditors as a whole and is just and equitable.

It has been stated that the Transferor Companies and the Transferee Company are closely held companies and their shares are not listed on any Stock Exchange

It  is  also  submitted  that  a  valuation  exercise  has  been carried out to determine the share swap ratio for the proposed Scheme of Amalgamation. M/s Alphavalue Consulting Valuation LLP, the Registered Valuer Entity, in respect of Securities or Financial Assets, registered with the Insolvency and Bankruptcy Board of India (IBBI), has prepared the Report on Valuation of Shares and Share Exchange Ratio.

The following Share Exchange Ratio has been proposed for the proposed Scheme of Amalgamation:

a) The Transferee Company, Lokdrushti Industries Private Limited will issue 1 (one) Equity Share of ₹10 each at a premium of Rs. 508.68 per share credited as fully paid-up, to the Shareholders of the Transferor Company No. 1, for every 1 (one) fully paid-up Equity Share of ₹10 each held in the Transferor Company No. 1- Gajbadan Hotels and Resorts Private Limited.

b) The Transferee Company, Lokdrushti Industries Private Limited will issue 1 (one) Equity Share of ₹10 each at a premium of Rs. 532.08 per share credited as fully paid-up, to the Shareholders of the Transferor Company No. 2, for every 1 (one) fully paid-up Equity Share of ₹10 each held in the Transferor Company No. 2 – Vinayak Investment Advisory Private Limited.

The Petitioner Companies have annexed the Share Valuation Report dated 14th March, 2023 given by M/s Alphavalue Consulting Valuation LLP, Registered Valuer Entity in respect of Securities or Financial Assets, registered with the Insolvency and Bankruptcy Board of India in relation to the share exchange ratio.

A perusal of the present Petition discloses that initially, the Petitioner Companies had filed a Company Application No. 12/ALD/2023 seeking directions of this Tribunal to dispense with the requirement of convening the meetings of the Equity Shareholders and Unsecured Creditors of the Transferor Companies and the Transferee Company, for the purpose of considering and approving the Scheme of Amalgamation. None of the Petitioner Companies has any Secured Creditor. Accordingly, this Tribunal vide its order dated 2nd June, 2023 (date of pronouncement), allowed the above-mentioned prayers, by dispensing with the requirement of convening the meetings of the Equity Shareholders and Unsecured Creditors of the Transferor Companies and the Transferee Company, for the purpose of considering and  approving the  Scheme of Amalgamation. None of the Petitioner Companies has any Secured Creditor.

This Tribunal vide its order dated 9th August, 2023, directed Notice to be issued in the present Company Petition/Scheme of Amalgamation to the following Statutory Authorities, viz., (i) Central Government through Regional Director (Northern Region), New Delhi; (ii) Registrar of Companies, Uttar Pradesh, Kanpur; (iii) Official Liquidator, Allahabad; and (iv) Principal Chief Commissioner of Income Tax, Lucknow with a copy to Principal Chief Commissioner of Income Tax, Kanpur.

This Tribunal further directed that the notice of hearing will also be advertised in “Business Standard” in English and “Jansatta” in Hindi language, having wide circulation over the area where the registered office of the Petitioners Companies are situated.

In compliance thereof, the Petitioner Companies have filed an Affidavit of service and publication, confirming that notices have been duly published in “Business Standard” in English and “Jansatta” in Hindi language on 7th September, 2023. The Petitioner Companies have also served notice of the Company Petition to (i) Central Government through Regional Director (Northern Region), New Delhi; (ii) Registrar of Companies, Uttarakhand; (iii) Official Liquidator, Dehradun;(iv) Principal Chief Commissioner of Income Tax, Lucknow; (v) Principal Chief Commissioner of Income Tax, Kanpur; (vi) Income Tax Department

In response to the above-stated notice, the Registrar of Companies, Ministry of Corporate Affairs, Uttarakhand, has submitted its Report dated 15th September, 2023. No objection has been raised by the Registrar of Companies on the Scheme of Amalgamation.

In response to the above-stated notice, the Regional Director, Northern Region, Ministry of Corporate Affairs, New Delhi has submitted its Report dated 29th September, 2023. No objection has been raised by the Regional Director on the Scheme of Amalgamation.

In response to the above-stated notice, the Official Liquidator, Ministry of Corporate Affairs, Dehradun, Uttarakhand has also submitted its Report dated 4th October, 2023 wherein it has been stated that the Official Liquidator has no objection to the dissolution of the Transferor Companies without winding up pursuant to provisions of Sections 230 and 232 of the Companies Act, 2013 and other applicable sections and rules thereunder.

In response to the notices served, the Income Tax Department has furnished its Report dated 27th September, 2023, 11th September, 2023 and 27th September, 2023 in respect of the Transferor Company No. 1, Transferor Company No. 2 and Transferee Company respectively. The Income Tax Department has given its ‘No-objection’ to the proposed Scheme of Amalgamation.

The Petitioner Companies have filed Affidavits vide diary no. 0902110006682023/7 dated 20.10.2023, wherein the Petitioner Companies have paid the demand of Rs. 1,945/-in Gajbadan Hotels and Resorts Private Limited (Transferor Company No. 1) and Rs. 343/- in Vinayak Investment Advisory Private Limited (Transferor Company No. 2) and as on date, there is no demand of Income tax pending against the Petitioner Companies.

The Petitioner Companies have also filed Affidavits vide Diary No. 0902110006682023/3 dated 16th September, 2023, confirming that neither the Petitioner Companies nor their Legal Counsel has received any objection/representation from any person against the Petition or the proposed Scheme of Amalgamation in response to the publication of the notice of hearing of the present Petition in Newspapers.

We have gone through the reports/comments of the Ld. Registrar of Companies, Uttarakhand; Ld. Regional Director (Northern Region), Ministry of Corporate Affairs, New Delhi; Ld. Official Liquidator, Ministry of Corporate Affairs, Dehradun, Uttarakhand; and the Income Tax Department and after perusing the same, 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 the above, all the statutory compliance seems to have been complied with by the Petitioner Companies, therefore, the present Company Petition deserves to be allowed in terms of its Prayer Clause.

As a result, the proposed Scheme of Amalgamation, which is annexed  to  the  Company  Petition  stands  approved  and sanctioned and the same shall be binding on all the Shareholders and Creditors of the above-named Petitioner Companies and also on the Petitioner Companies with effect from the Appointed Date, i.e., 1st day of April, 2023. The Petitioner Companies are required to act upon as per terms and conditions of the sanctioned Scheme of Amalgamation.

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.

THIS TRIBUNAL DO FURTHER ORDER:

a. Upon the Scheme becoming effective, all the property, rights and powers of the Transferor Companies specified in the Scheme hereto and all other property, rights and powers of the Transferor Companies be transferred, without further act or deed, to the Transferee Company and accordingly, the same shall, pursuant to Sections 230 & 232 of the Companies Act, 2013, be transferred to and vested in the Transferee Company for all the estate and interest of the Transferor Companies therein but subject nevertheless to all charges now affecting the same; and

b. Upon the Scheme becoming effective, all the liabilities and duties of the Transferor Companies be transferred, without further act or deed, to the Transferee Company, and accordingly the same shall pursuant to Sections 230 & 232 of the Companies Act, 2013, be transferred to and become the liabilities and duties of the Transferee Company; and

c. Upon the Scheme becoming effective, all the employees of the Transferor Company, in service on the Effective Date, shall be transferred to and shall become the employees of the Transferee Company as provided in the Scheme of Amalgamation; and

d. Upon the Scheme becoming effective, all proceedings now pending by or against the Transferor Company be continued by or against the Transferee Company; and

e. Upon  the  Scheme  finally  coming  into  effect  and  in consideration of the transfer and vesting of all the said assets and liabilities of the Transferor Companies to the Transferee Company in terms of the Scheme, the Transferee Company shall, without any further application or deed, issue and allot Share(s) to the Shareholders of the Transferor Companies in the following manner as provided in the Scheme of Amalgamation:

a) The Transferee Company, Lokdrushti Industries Private Limited will issue 1 (one) Equity Share of ₹10 each at a premium of Rs. 508.68 per share credited as fully paid-up, to the Shareholders of the Transferor Company No. 1, for every 1 (one) fully paid-up Equity Share of ₹10 each held in the Transferor Company No. 1- Gajbadan Hotels and Resorts Private Limited.

b) The Transferee Company, Lokdrushti Industries Private Limited will issue 1 (one) Equity Share of ₹10 each at a premium of Rs. 532.08 per share credited as fully paid-up, to the Shareholders of the Transferor Company No. 2, for every 1 (one) fully paid-up Equity Share of ₹10 each held in the Transferor Company No.2 - Vinayak Investment Advisory Private Limited.

Liberty is granted to the Petitioners to file the Schedule of Assets.

The Petitioner Companies 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, Uttarakhand, for registration; and on such certified copy being so delivered, the Transferor Companies shall stand dissolved without undergoing the process of winding up and the Registrar of Companies shall place all documents relating to the Transferor Companies and registered with him on the file kept by him in relation to the Transferee Company and the files relating to the said three Companies shall be consolidated accordingly; and

The Petitioner Companies shall supply legible printouts of the Scheme in an acceptable form to the Registry and the Registry will append such printouts, after verification, to the certified copy of the Order.

Certified  copy  of  this  Order  be  supplied,  if  applied  for, subject to compliance with usual formalities.

That the Resulting Company shall deposit an amount of Rs.25,000/- (Rupees Twenty Five Thousand Only) in favour of “The Ministry of Corporate Affairs” within a period of four weeks from the date of receipt of the certified copy of this order and file affidavit of compliance thereof.

All the concerned Regulatory Authorities and other persons to act on a copy of this Order annexed with the Scheme duly authenticated by the Registrar, National Company Law Tribunal, Allahabad Bench.

Any person interested shall be at liberty to apply to the Tribunal in the above matter for any directions that may be necessary.

Accordingly, the present Company Petition bearing CP (CAA) No. 11/ALD/2023 is allowed and stands disposed of.