Kanin (India) Limited vs Kanin Industries Private Limited

Santanu Kumar Mohapatra, Member (T)

This application has been jointly filed by both the Applicant Companies under Sections 230 to 232 of the Companies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 and the National Company Law Tribunal Rules, 2016, duly supported by separate affidavits of the Applicant Companies, for seeking appropriate orders/directions for convening the respective meetings of shareholders, secured creditors and unsecured creditors of the applicant companies, in connection with the proposed Scheme of Amalgamation contemplated between the applicant companies. The said Scheme of Arrangement (hereinafter referred to as the "Scheme") has been placed on record along with the joint application.

It is represented that the registered offices of both the applicant companies are situated in New Delhi and therefore the subject matter of this joint application falls within the Jurisdiction of this Bench.

M/s. Kanin (India) Limited (Transferor Company) was incorporated on 13.09.1985 under the provisions of the Companies Act, 1956. The present Authorized Share Capital of the Transferor Company is Rs. 6,00,00,000/- divided into 6,00,000 Equity Shares of Rs. 100/-. The present Issued, Subscribed and paid-up Share Capital of the Company is Rs. 5,35,00,000/- divided into 5,35,000 Equity Shares of Rs. 100/- each. The registered office of the Transferor Company is presently situated at A-46, Mohan Co-operative Industrial Estate Limited, Mathura Road, New Delhi - 110044.

It is submitted that the transferor Company has 15 Equity Shareholders. Additionally, transferor company has 04 secured creditors and 371 unsecured creditors. In respect of meetings of equity shareholders, secured creditors and unsecured creditors, the applicants have proposed on 17.02.2020 the place, date and time of the meetings and have prayed for issuance of directions for convening and holding of their respective meetings in order to obtain their approval in favour of the Scheme.

M/s. Kanin Industries Private Limited (Transferee Company) was incorporated on 01.11.2019 as a private limited company under the provisions of the Companies Act, 1956. The registered office of the Company is presently situated at A-46, Mohan Co-operative Industrial Estate Limited, Mathura Road, New Delhi - 110044. The Authorized Share Capital of the company is Rs. 1,00,00,000/- divided in to 1,00,000 equity shares of Rs. 100/- each. The present Issued, subscribed and paid up share Capital of the Company is Rs. 1,00,000/- divided into 1,000 Equity Shares of Rs. 100/- each.

It is submitted that the transferee Company has 2 Equity Shareholders. As on 31.12.2019, the transferee company has no secured creditor and 1 unsecured creditor. As the company has no secured creditor, the requirement of convening meeting of the meeting of secured creditors does not arise. In respect of meetings of equity shareholders and unsecured creditors of the transferee Company, the applicants have proposed on 17.02.2020 the place, date and time of the meetings and have prayed for issuance of directions for convening and holding of their respective meetings in order to obtain their approval in favour of the Scheme.

We have perused the joint applications and the connected documents/papers filed by the applicants including the Scheme of Amalgamation as contemplated between the applicant companies.

It is seen that the board of directors of both the applicant companies vide meetings held on 12.12.2019 have unanimously approved the proposed Scheme of Amalgamation. Copies of such resolutions passed thereat have been placed on record by the applicant companies.

Both the applicants have also filed their respective Memorandum and Articles of Associations. The applicants have further filed the audited financial statement of transferor company for the year ending 31.03.2019 and provisional unaudited management accounts of transferee company till 31.12.2019.

It is submitted that the proposed demerger is sought to be made under the provisions of Section 230 to 232 of the Companies Act, 2013 and the same if sanctioned by this Tribunal the appointed date as provided in the Scheme shall be 01.04.2020.

Both the applicant companies have submitted on affidavit that no proceedings for inspection, inquiry or investigation under the provisions of the Companies Act, 2013 or under any other law is pending against any of the applicant companies.

Certificates of the respective statutory auditors of both the applicant companies have been placed on record confirming that the accounting treatment in the Scheme is in conformity with Section 133 of the Companies Act, 2013.

Further, it has been stated in the application that the Scheme will be beneficial to both the applicant companies and their respective shareholders, employees, creditors and other stake holders.

In the facts and taking into consideration the application jointly filed by the Applicant Companies the following directions are issued: -

A. In relation to the Transferor Company: -

i. The meeting of the equity shareholders of the transferor company is directed to he held at A-46, Mohan Co-operative Industrial Estate Limited, Mathura Road, New Delhi-110044, on 03.04.2020 at 10:00 A.M. The quorum of the meeting shall he 10 in number or 90 % in value.

ii. The meeting of secured creditors of the transferor company is directed to be held at A-46, Mohan Co-operative Industrial Estate Limited, Mathura Road, New Delhi-110044, on 03.04.2020 at 11:30 A.M. The quorum of the meeting shall be 2 in number or 90 % in value.

iii. The meeting of unsecured creditors is directed to be held at A-46, Mohan Co-operative Industrial Estate Limited, Mathura Road, New Delhi - 110044, on 03.04.2020 at 1:30 PM. The quorum of the meeting shall be 100 in number or 90% in value.

B. In relation to the Transferee Company: -

i. The meeting of the equity shareholders of the transferee company is directed to be held at A-46, Mohan Co-operative Industrial Estate Limited, Mathura Road, New Delhi-110044, on 03.04.2020 at 3:00 P.M. The quorum of the meeting shall be 2 in number or 90% in value.

ii. The meeting of secured creditors is dispensed with because there is no secured creditor in the company and therefore, the requirement of convening meeting of secured creditors does not arise.

iii. The meeting of unsecured creditors is directed to be held at A-46, Mohan Co-operative Industrial Estate Limited, Mathura Road, New Delhi- 110044, on 03.04.2020 at 04:00 P.M. The quorum of the meeting shall be 1 in number or 90% in value.

C. Mr. P.K. Malhotra, Former Law Secretary (Mobile No. 9818559029) is appointed as the Chairperson and Mr. Inderjeet Singh, Advocate (Mobile No. 9818285641) is appointed as the Alternate Chairperson and Mr. Gopal Prasad Aggarwal, Chartered Accountant (Mobile No. 9437052192) is appointed as Scrutinizer for the aforesaid meetings in terms of direction issued herein.

D. In case the quorum as noted above for the aforesaid meetings are not present at the meetings, then the meeting shall be adjourned by half an hour, and thereafter the persons present and voting shall be deemed to constitute the quorum. For the purpose of computing the quorum the valid proxies shall also be considered, if the proxy in the prescribed form, duly signed by the person entitled to attend and vote at the meeting, is filed with the respective registered offices of the applicant companies at least 48 hours before the meetings. The Chairperson and Alternate Chairperson appointed herein along with Scrutinizer shall ensure that the proxy registers are properly maintained.

E. The fee of the Chairperson for the aforesaid meetings shall be Rs. 1,50,000/-, the fee of the Alternate Chairperson shall be Rs. 1,00,000/- and the fee of the Scrutinizer shall be Rs. 1,00,000/- in addition to meeting their incidental expenses.

F. The Chairperson will file its reports in respect of all the meetings within a week from the date of holding of the above meetings.

G. That the applicant companies shall publish advertisement with a gap of at least 30 days before the aforesaid meetings, indicating the day, date and the place and time as aforesaid, to be published in Delhi editions of 'Business Standard' English edition and "Business Standard" Hindi edition stating that the copies of the Scheme, the explanatory statement required to be furnished pursuant to Section 230 of the Companies Act, 2013 and the form of proxy shall be provided free of charge at the respective registered offices of the applicant Companies.

H. Voting shall be allowed on the proposed Scheme by voting in person, by proxy, through postal ballot or through electronic means as may be applicable for the respective meetings of equity shareholders and creditors of both the applicant Companies in terms of the provisions of the Companies Act, 2013 and Rules framed there under.

I. The companies shall individually send notice to Central Government through Regional Director (Northern Region), Ministry of Corporate Affairs, the Income Tax Authorities, Registrar of Companies National Capital Territory of Delhi and Haryana, Official Liquidator along with copy of relevant documents and disclosures as required under the provisions of Companies Act, 2013 read with Companies (Compromises, Arrangements, Amalgamations) Rules, 2016.

J. The Applicant Companies shall further furnish copy of the Scheme free of charge within 1 day of any requisition for the Scheme made by every shareholders and creditors of the Applicant Companies entitled to attend the meetings as mentioned above.

K. The authorized representative of both the Applicant Companies shall furnish an affidavit of service of notice of the meetings and publication of advertisement and compliance of all directions contained herein at least a week before the proposed meetings.

L. All the aforesaid directions are to be complied with by the applicant companies strictly in accordance with the applicable law including forms and formats contained in the Companies (Compromises, Arrangements, Amalgamations) Rules, 2016 as well as in terms of the provisions of the Companies Act, 2013.

The application stands allowed in the aforesaid terms.

Let the copy of the order be served to the parties.