Jalnidhi Bitumen Specialities Private Limited Vs

Balraj Joshi, Member (Technical)

The instant petition has been filed under Section 230(6) read with Section 232(3) of the Companies Act, 2013 (“Act”) for sanction of the Scheme of Amalgamation of ALANKAR TOWERS PRIVATE LIMITED being the Petitioner No. 2 above named ("Transferor Company No 1 " or “Petitioner No. 2”) and PRANATI PROPERTIES PRIVATE LIMITED being the Petitioner No. 3 above named ("Transferor Company No 2 " or “ Petitioner No. 3”) and SPMK PROPERTIES PRIVATE LIMITED being the Petitioner No. 4 above named ("Transferor Company No 3 " or “ Petitioner No. 4”) with JALNIDHI BITUMEN SPECIALITIES PRIVATE  LIMITED  being  the Petitioner No.1 above named  ("Transferee Company " or “Petitioner   No.1”) whereby and where under the Transferor Companies are proposed to be amalgamated with the Transferee Company from the Appointed Date, 01st April, 2020 in the manner and on the terms and conditions stated in the said Scheme of Amalgamation.(“Scheme”).

The Petition has now come up for final hearing. Counsel for the Applicants submits as follows:-

(a) The Scheme was approved by the Board of Directors of the Petitioner Companies at their meetings held on 25th January,2021.

(b) The circumstances which justify and/or have necessitated the Scheme and the benefits of the same are, inter alia, as follows:-

a. Apart from pursuing its main object, the TRANSFEREE COMPANY and all the Transferor companies have made deployment of funds in other investable instruments. The activities of the TRANSFEROR COMPANIES and the TRANSFEREE COMPANY can be combined/adjusted and carried forward conveniently with combined strength;

b. The amalgamation will enable the TRANSFEREE COMPANY to consolidate its line of business by restructuring and re-organizing its business activities and Capital Structure;

c. The amalgamation will enable the amalgamated company to broad base their business activities under the roof of the

TRANSFEREE COMPANY;

d. The amalgamation will result in economy of scale including reduction in overhead expenses relating to management and administration in better and more productive utilization of various resources;

e. The business of the Transferor Companies can be conveniently and advantageously combined together and in general with the business of the Transferee Company concerned and will be carried on more economically and profitably under the said Scheme;

f. The said Scheme of Amalgamation will enable the establishment of a larger company with larger resources and a larger capital base enabling further development of the business of the company concerned. The said scheme will also enable the undertakings and business of the said applicant company to obtain greater facilities possessed and enjoyed by one large company compared with a number of small Company for raising capital, securing and conducting trade on favorable terms and other benefits;

g. The said scheme will contribute in furthering and fulfilling the objects of the Company concerned and in the growth and development of these businesses;

h. The said scheme will strengthen and consolidate the position of the amalgamated company and will enable the amalgamated company to increase its profitability;

i. The said scheme will enable the undertakings concerned to pool their resources and to expand their activities;

j. The said scheme will enable the Companies concerned to rationalize and streamline their management, business and finances and to eliminate duplication of work to their common advantages;

k. The said scheme will have beneficial results for the Companies concerned, their shareholders, employees and all concerned.

(c) The Statutory Auditors of the Petitioner Companies have by their certificate dated 05th March,2021 have confirmed that the accounting treatment in the Scheme is in conformity with the accounting standards prescribed under Section 133 of the Companies Act, 2013.

(d) No proceedings are pending under Sections 210 to 227 of the Companies Act, 2013 against the Petitioner(s).

(e) The exchange ratio of shares in consideration of the Amalgamation has been fixed on a fair and reasonable basis and on the basis of the Report dated 20th January,2021 thereon of VISHAL GUPTA, IBBI , Registered Valuer.

(f) By an order dated 26th August, 2021 in Company Application No. C.A (CAA) No.104/(KB)/2021 this Tribunal made the following directions with regard to meetings of shareholders and creditors under Section 230(1) of the Act:-

a. Meetings dispensed:

Equity Shareholders

Meeting of Equity Shareholders of the Applicant Companies for considering the Scheme are dispensed with in view of all shareholders of Applicant Companies having respectively given their consent to the Scheme by way of affidavits.

Unsecured Creditors

Meeting of Unsecured Creditors of Applicant No 2 for considering the Scheme are dispensed with in view of consent by 100% in value of Unsecured creditors of Applicant No 2 having respectively given their consent to the Scheme by way of affidavits.

Meeting of Unsecured Creditors of Applicant No 3 for considering the Scheme are dispensed with in view of consent by 100% in value of Unsecured creditors of Applicant No 3 having respectively given their consent to the Scheme by way of affidavits.

Meeting of Unsecured Creditors of Applicant No 4 for considering the Scheme are dispensed with in view of consent by 100% in value of Unsecured creditors of Applicant No 3 having respectively given their consent to the Scheme by way of affidavits.

b. No requirement of Meetings

Unsecured Creditors

Secured Creditors of Applicant No 2 , Applicant No 3 and Applicant No 4 NIL Creditors verified by auditors certificate.

c. Meetings to be held

Secured Creditors of Applicant No 1 and Unsecured Creditors of Applicant No 1.

(g) Consequently, the Petitioner(s) presented the instant petition for sanction of the Scheme. By an order dated 21st June,2022 the instant petition was admitted by this Tribunal and fixed for hearing on 25th July,2022 upon issuance of notices to the Statutory / Sectoral Authorities and advertisement of date of hearing. In compliance with the said order dated 21ST June,2022 the Petitioner(s) have duly served such notices on the Regulatory Authorities viz Upon Income Tax Authorities though special messenger on 04th July ,2022 and by email on 01st July,2022 and 05th July , 2022, Upon Registrar of Companies , Kolkata ,West Bengal through special messenger on 30th June ,2022 and by email on 01st July 2022 and Upon Regional Director, Eastern Region through special messenger on 30th June ,2022 and by email on 01st July 2022 , Upon Official Liquidator , High Court Calcutta on 30th June,2022. The Petitioner(s) have also published such advertisements once each in the Financial Express and Dainik Statesman in their respective issues dated 01st July,2022. An affidavit of Compliance duly affirmed on 07th July,2022 has also been filed.

(h) All statutory formalities requisite for obtaining sanction of the Scheme have been duly complied with by the Petitioners. The Scheme has been made bona fide and is in the interest of all concerned.

By an order dated 31st March,2022 in Misc App (Comp Act) No 2 / KB / 2022 Connected with C.A (CAA) No. 104 / KB / 2021 this Tribunal has recorded the following at Paragraph 9 and Paragraph 10 of the said order :-

Paragraph 9

Heard the Ld. Counsel for the Applicants and perused the records and it appears that the issues raised by the Chairperson are not relevant. The Secured Creditors and Unsecured Creditors who joined the meeting and voted there at have unanimously approved the resolution. It would be evident from the Chairperson’s Report and Report of the Scrutinizer that the votes have been declared invalid on technical grounds which are not material. Infact the Chairperson has not taken into consideration the Report of the Scrutinizer.

Paragraph 10

Hence, the Bench, therefore, considers that the resolution contained in the notice convening the meeting has been passed unanimously by the Secured Creditors of the Transferee Company / Applicant No 1 and Unsecured Creditors of the Transferee Company / Applicant No 1 in meeting held virtually on 28th October,2021.

Pursuant to the said advertisements and notices the Regional Director, Ministry of Corporate Affairs, Kolkata (“RD”), Official Liquidator, High Court have filed their representations before this Tribunal.

The Official Liquidator has filed his report dated 14 / 07 / 2022 and concluded as under: -

PARA 8

That the Official Liquidator has not received any complaint against the proposed Scheme of Amalgamation from any person/party interested in the Scheme in any manner till the date of filing of this Report.

PARA 10

That the Official Liquidator on the basis of information submitted by the Petitioner Companies is of the view that the affairs of the aforesaid Transferor Companies do not appear to have been conducted in a manner prejudicial to the interest of its members or to public interest as per the provisions of the Companies Act, 1956/the Companies Act, 2013 whichever is applicable.

The RD has filed his reply affidavit dated 19th July, 2022 (“RD affidavit”) which has been dealt with by the Petitioner(s) by their Rejoinder affidavit dated 22nd July,2022 (“Rejoinder”). The observations of the RD and responses of the Petitioner(s) are summarized as under:-

Paragraph 2 (a) of RD Affidavit

It is submitted that on examination of the report of the Registrar of Companies, West Bengal, it appears that no complaint and/or representation regarding the proposed Scheme of Amalgamation has been received against Petitioner Companies. Further, as per available records , the all the Petitioner Companies are updated in filing their Statutory Returns for the financial year 31/03/2021. However in the said report , the ROC WB made some observation regarding active charge pending against the petitioner companies , copy of the report of the ROC,WB marked as Annexure-I is enclose herewith for perusal and ready reference .

Paragraph 2 (a) of the Rejoinder

No adverse comments made by the Registrar of Companies, West Bengal in his report to the Regional Director. Further the Registrar of Companies, West Bengal has not received any Complaint and / or representation from any person on the proposed Scheme. Hence no comments are offered.

As regards active charges in respect of the Transferee Company they shall continue to exist. As regards active charges in respect of Petitioner Transferor Companies namely – Pranati Properties Private Limited and SPMK Properties Private Limited they have provided corporate guarantee for credit facilities availed by Transferee Company. Relevant pages of the Balance Sheet for 31-03-2021 of Pranati Properties Private Limited and SPMK Properties Private Limited admitting the corporate guarantee provided are annexed collectively and marked - ANNEXURE – B.

Paragraph 2 (b) of RD Affidavit

The Petitioner Companies should be directed to provide list / details of Assets, if any, to be transferred from the Transferor Companies to the Transferee Company upon sanctioning of the proposed Scheme.

Paragraph 2 (b) of the Rejoinder

The Deponents duly authorized hereby undertakes that Petitioner Companies, shall file list / details of assets that will be transferred by the Transferor Companies to the Transferee Company upon coming into effect of the Scheme.

Paragraph 2 (c) of RD Affidavit

Petitioner company should undertake to comply with the provisions of section 232(3)(i) of the Companies Act,2013 through appropriate affirmation.

Paragraph 2 (c) of the Rejoinder

The Deponents duly authorised hereby confirms that the Transferee Company undertakes to comply with the provisions of Sec 232(3)(i) of the Companies Act, 2013 in regard to adjustment of fees upon clubbing of Authorized Share Capital(s) of the Transferor Company (ies) with the Authorized Share Capital of the Transferee Company in post-amalgamation and shall file a detailed statement thereof with the Registrar of Companies at the time of filing of INC – 28.

Paragraph 2 (d) of RD Affidavit

That the Transferee Company should be directed to pay stamp duty, if any, applicable on the transfer of the immovable properties from the Transferor Companies to it.

Paragraph 2 (d) of the Rejoinder

The Deponents duly authorized hereby undertakes that the Transferee Company / Resultant Company shall pay applicable stamp duty on the transfer of the immovable properties from the Transferor Companies to it.

Paragraph 2 (e) of RD Affidavit

The Hon'ble Tribunal may kindly direct the Petitioners to file an affidavit the extent that the Scheme enclosed to the Company Application and Company Petition are one and same and there is no discrepancy or no change is made.

Paragraph 2 (d) of the Rejoinder

The Deponents duly authorized hereby undertakes that the Transferee Company / Resultant Company shall pay applicable stamp duty on the transfer of the immovable properties from the Transferor Companies to it.

Paragraph 2 (e) of the Rejoinder

The Deponent duly authorised by the Petitioner Companies hereby affirms that the Scheme enclosed to the Company Application and Company Petition are one and same and there is no discrepancy or no change is made.

Paragraph 2 (f) of RD Affidavit

It is submitted that as per instructions of the Ministry of Corporate Affairs, New Delhi, a copy of the scheme was forwarded to the Income Tax Department on 26/10/2021 with a request to forward their comments / observations / objections, however the same is still awaited.

Paragraph 2 (f) of the Rejoinder

The Income Tax authorities have not made any observations on notice served by the office of the Regional Director.

Further the Petitioner Companies have also complied with the directions contained in the order passed by the Hon’ble Tribunal in the dispensation order and direction order and have effected service upon the Income Tax Department. However, the said department have not made/ filed observation pursuant to the said notices filed by the Petitioner Companies.

Heard submissions made by the Ld Counsel appearing for the Petitioner, RD. Upon perusing the records and documents in the instant proceedings and considering the submissions, we allow the petition and make the following orders:-

a. The Scheme of Amalgamation mentioned in this Petition being Annexure “A” hereto, be and is hereby sanctioned with appointed date as 1st day of April, 2020 on ALANKAR TOWERS PRIVATE LIMITED, PRANATI PROPERTIES PRIVATE LIMITED and SPMK PROPERTIES PRIVATE LIMITED with JALNIDHI BITUMEN SPECIALITIES PRIVATE LIMITED, and their shareholders and all concerned;

TRANSFER OF ALL ASSETS

a. All the properties, rights and interest of ALANKAR TOWERS PRIVATE LIMITED, PRANATI PROPERTIES PRIVATE LIMITED and SPMK PROPERTIES PRIVATE LIMITED be transferred to and vested in without further act or deed in JALNIDHI BITUMEN SPECIALITIES PRIVATE LIMITED and accordingly the same shall pursuant to Section 232 of the Companies Act, 2013 and read with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016 be transferred to and vested in JALNIDHI BITUMEN SPECIALITIES PRIVATE LIMITED for all the estate and interest of ALANKAR TOWERS PRIVATE LIMITED, PRANATI PROPERTIES PRIVATE LIMITED and SPMK PROPERTIES PRIVATE LIMITED but subject nevertheless to all charges, now affecting the same;

TRANSFER OF ALL LIABILITIES

b. All the liabilities and duties of ALANKAR TOWERS PRIVATE LIMITED, PRANATI PROPERTIES PRIVATE LIMITED and SPMK PROPERTIES PRIVATE LIMITED be transferred without further act or deed to JALNIDHI BITUMEN SPECIALITIES PRIVATE LIMITED and accordingly the same shall pursuant to Section 232 of the Companies Act, 2013 and read with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016 be transferred to and become the liabilities and duties of JALNIDHI BITUMEN SPECIALITIES PRIVATE LIMITED;

TRANSFER OF ALL LEGAL PROCEEDINGS

c. That all the proceedings and/or suit appeals now pending by or against ALANKAR TOWERS PRIVATE LIMITED, PRANATI PROPERTIES PRIVATE LIMITED and SPMK PROPERTIES PRIVATE shall be continued by or against JALNIDHI BITUMEN SPECIALITIES PRIVATE LIMITED;

ALLOTMENT OF SHARES

d. JALNIDHI BITUMEN SPECIALITIES PRIVATE LIMITED do issue and allot shares to the shareholders of ALANKAR TOWERS PRIVATE LIMITED, PRANATI PROPERTIES PRIVATE LIMITED and SPMK PROPERTIES PRIVATE LIMITED as envisaged in the said Scheme of Amalgamation and for that, if necessary, to increase the authorized share capital;

FILING SCHEDULE OF ASSETS & LIABILITIES

e. The Schedule of Assets & Liabilities in respect of JALNIDHI BITUMEN SPECIALITIES PRIVATE LIMITED and ALANKAR TOWERS PRIVATE LIMITED, PRANATI PROPERTIES PRIVATE LIMITED and SPMK PROPERTIES PRIVATE LIMITED be filed within a period of 60 days from the date of the order to be made herein;

DISSOLUTION OF TRANSFEROR COMPANIES

f. The Transferor Companies namely - ALANKAR TOWERS PRIVATE LIMITED, PRANATI PROPERTIES PRIVATE LIMITED and SPMK PROPERTIES PRIVATE LIMITED shall stand dissolved without winding up from the effective date ;

FILING OF CERTIFIED COPY OF ORDER

g. The applicant companies shall within 30 days after the date of obtaining the Certified Copy of the order (effective date) to be made herein cause certified copies of this order to be delivered to the Registrar of Companies, West Bengal for registration.

MISCELLANEOUS

h. Any person interested shall be at liberty to apply to this Hon’ble Tribunal in the above matter for any direction that may be necessary;

In case of any default, including any provisions of Income Tax in respect of transferor companies, the Income Tax Department, the ROC West Bengal and all others, statutory departments/authorities shall be at liberty to initiate appropriate proceedings against the transferee company and this sanction shall not come in the way of such authorities in taking any lawful action against the defaulting entities including the Transferee company, which after the sanction of the scheme by this tribunal is in any case shall be responsible for the liabilities/non-compliances of the transferor companies as well.

The Petitioner(s) shall supply legible print out of the scheme and schedule of assets and liabilities in acceptable form to the department and the department will append such printout, upon verification to the certified copy of the order.

The Company Petition C.P(CAA) No. 69/ KB / 2022 connected with Company Application C.A(CAA) No. 104 / KB / 2021 is disposed of accordingly.

Urgent certified copy of this order, if applied for, be supplied to the parties, subject to compliance with all requisite formalities.