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Judgment
R. Sucharitha Member (Judicial)
This is an application filed by the Applicant Company, namely M/s. FLOMETALLIC INDIA PRIVATE LIMITED (for brevity "Transferor Company") with MIS. BRAKES INDIA PRIVATE LIMITED (for brevity " Transferee Company") under section 230-232 of Companies Act, 2013, and other applicable provisions of the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 in relation to the Scheme of Amalgamation (hereinafter referred to as the "SCHEME") proposed by the MIS. FLOMETALLIC INDIA PRIVATE LIMITED with M/S. BRAKES INDIA PRIVATE LIMITED .The said Scheme is also appended as Annexure at page - 295 to 337 to the CA(CAA)/93(CHE)/2021.
The Applicant Companies in this Company Application has sought for the following relief;
EQUITY SECURED
SHAREHOLDERS
CREDITORS
UNSECURED
CREDITORS
TRANSFEREE COMPANY
To dispense with
To dispense with
To Order for Meeting
TRANSFEREE COMPANY
To dispense with
To dispense with
To Order for Meeting
An affidavit in support of the above application is sworn for and behalf of the applicant Companies has been filed by Mr. K. Sekar in the capacity of Authorised Signatory for the Transferor Company and by one Mr. Sriram Viji in the capacity as Deputy Managing Director of the Transferee Company along with the application and it is also represented that the Registered office of the Transferor and Transferee Company is situated within the territorial jurisdiction of the Bench of this Tribunal and falling within the purview of Registrar of Companies, Chennai.
FLOMETALLIC INDIA PRIVATE LIMITED (TRANSFEROR COMPANY) - CA(CAA)93(CHE)/2021
(I) There are 4 (Four) Equity Shareholders and list of shareholders to this effect is placed at page 112 and consent affidavits given by all is placed at Page No.114 to 130 of the typed set filed with the application and sought for dispensation with holding of meeting.
(ii) There are 23 Secured Debenture Holders represented by 1 Debenture Trustee and the certificate issued by the Chartered Accountants to this effect is placed at page 131 to 132 of the typed set filed with the application and consent affidavits given by the sole Debenture Trustee on behalf of the 23 Secured Debenture Holders is placed at Page No.133 - 135 of the typed set filed with the application and sought for dispensation with holding of meeting.
(iii) There are 215 Unsecured Creditors and the certificate issued by the Chartered Accountants to this effect is placed at Page Nos. 258 to 266 of the typed set filed with the application and sought for a direction convene / hold the meeting.
BRAKES INDIA PRIVATE LIMITED (TRANSFEREE COMPANY) - CA(CAA)96(CHE)/ 2021
(i) There are 8 (Eight) Equity Shareholders and list of shareholders to this effect is placed at page 162 and consent affidavits given by all is placed at Page No.163 to 189 of the typed set filed with the application and sought for dispensation with holding of meeting.
(ii) There is 1 (One) Secured Creditors and the certificate issued by the Chartered Accountant to this effect is placed at page 190 of the typed set filed along with the Application and consent affidavits given by the sole Secured Creditor is placed at Page No.192 to 195 of the typed set filed with the application and sought for dispensation with holding of meeting.
(iii) There are 2443 Unsecured Creditors and the certificate issued by the Chartered Accountant to this effect is placed at page 196 to 400 of the typed set filed along with the Application and sought for a direction to convene / hold the meeting.
We have perused the application and the connected documents / papers filed therewith including the Scheme contemplated by the Applicant companies.
From the certificate of incorporation filed, it is evident that the Transferor Company is a Private limited company incorporated under the provisions of Companies Act, 1956 on 05.10.2010. The Authorized Share Capital of the Transferor Company is Z100,00,00,000 (Rupees One Hundred Crore Only) consisting of 10,000 Equity Shares of Rs.1,00,000/- each. The Issued, Subscribed and Paid-up Capital of the Transferor Company is Z95,00,00,000/-(Rupees Ninety Five Crore only) consisting of 9500 Equity Shares of Rs.1,00,000/- each. The Registered office address of the Transferor Company is situated at 67, Chamiers Road, Chennai - 600 028
From the certificate of incorporation filed, it is evident that the Transferee Company is a Private limited company incorporated under the provisions of Companies Act, 1956 on 09.11.1962. The Authorized Share Capital of the Transferee Company is U5,00,00,000 (Rupees Twenty Five Crore Only) consisting of 25,00,000 Equity Shares of Rs.100/- each. The Issued, Subscribed and Paid-up Capital of the Transferee Company is U3,92,00,000/-
(Rupees Twenty Three Crore Ninety Two Lakh only) consisting of 23,92,000 Equity Shares of Rs.100/- each. The Registered office address of the Transferee Company is situated at 21, Patullos Road, Chennai - 600 002
The Applicant Companies has filed its Memorandum and Articles of Association inter alia delineating its object clauses as well as their last available Audited Annual Accounts for the year ended 31.03.2021.
The Board of Directors of the Transferor and Transferee Companies vide meeting held on 15.07.2021 and 19.07.2021 respectively have unanimously approved the proposed Scheme as contemplated above and copies of resolutions passed thereon have been placed on record by the applicant companies.
The Appointed date as specified in the Scheme Shall be 1st July 2021.
The Statutory Auditors of the Transferee Company have examined the Scheme in terms of provisions of Sec. 232 of Companies Act, 2013 and the rules made thereunder and certified that the Accounting Standards are in compliance with Section 133 of the Companies Act, 2013. The Certificate of the Statutory Auditors issued in this regard is placed at pages 401 to 404 of the typed set filed along with the CA(CAA)/96(CHE)/2021.
The Learned Counsel for the Applicant requested for a direction to the Application Companies for the purpose of issuance of notices issued to the Unsecured Creditors in relation to Transferor Company having not less that Rs.5 Lakh limit of credit, and Unsecured Creditors in relation to Transferee Company having not less than Rs.25 Lakh limit of credit, and atleast not less than 30 days prior to the date fixed for meeting. However, such a request made by the Learned Counsel for the Application Companies cannot be acceded to by this Tribunal. The Applicant Companies are required to issue individual notices to all the Unsecured Creditors of the Transferor and Transferee Companies.
Taking into consideration the application filed by the Applicant Company and the documents filed therewith as well as the position of law, this Tribunal propose to issue the following directions : -
A. IN RELATION TO THE TRANSFEROR COMPANY:
(1) With respect to Equity shareholders:
Since it is represented by the Transferor Company that there are 4 Equity Shareholders in the Company whose consents by way of Affidavits have been obtained from all and are placed on record, the necessity of convening and holding the meeting is dispensed with.
(ii) With respect to Secured Creditors:
Since it is represented by the Transferor Company that ther are 23 Secured Debenture Holders and the consents by way of Affidavit given by the Debenture Trustee have been obtained and placed on record, the necessity of convening and holding the meeting is dispensed with.
(iii) With respect to Unsecured Creditors:
Meeting of the Unsecured Creditors of the Transfero Company is directed to be held on 27.01.2022 at 2:30 PM at Hotel Jaya Pushpam (JP Hotel Chennai), 'Chakravarthy Hall', 1131, Jawaharlal Nehru Road, Jai Nagar, Koyambedu, Chennai - 600 107 or through video conferencing or if not convenient at any other suitable place for which prior approval shall be sought from this Tribunal within a period of 7 days from the date of this order and prior to the issue of notices.
B. IN RELATION TO THE TRANSFEREE COMPANY:
(i) With respect to Equity shareholders:
Since it is represented by the Transferee Company that there are 8 Equity Shareholders in the Company whose consents by way of Affidavits have been obtained from all and are placed on record, the necessity of convening and holding the meeting is dispensed with.
(ii) With respect to Secured Creditors:
Since it is represented by the Transferee Company that there are is 1 Secured Creditor and the consent by way of Affidavit given by sole Secured Creditor have been obtained and placed on record, the necessity of convening and holding the meeting is dispensed wik-h.
(iii) With respect to Unsecured Creditors:
Meeting of the Unsecured Creditors of the Transferee Company is directed to be held on 27.01.2022 at 11:30 AM at Hotel Jaya Pushpam (JP Hotel Chennai), 'Chakravarthy Hall', 1131, Jawaharlal Nehru Road, Jai Nagar, Koyambedu, Chennai - 600 107 or through video conferencing or if not convenient at any other suitable place for which prior approval shall be sought from this Tribunal within a period of 7 days from the date of this order and prior to the issue of notices.
The quorum for the meeting of the Unsecured Creditors of the Transferor and Transferee Company shall be 10 and 20 respectively.
i) The Chairperson appointed for the above said meetings shall be Mr. Sriram Viji and the alternate chairperson appointed for the above said meeting shall be the Mr. Harsha Viji, Director of the Transferor Company.
ii) Mr. T. Narayanan, Company Secretary of the Transferee Company is appointed as a Scrutinizer. The Chairperson(s) will file the reports of the meeting within a week from the date of holding of the above said meetings.
iii) In case the quorum as noted above, for the above meeting of the Applicant Companies is not present at the meeting, then the meeting shall be adjourned by half an hour, and thereafter the person(s) present and voting shall be deemed to constitute the quorum. For the purpose of computing the quorum the valid proxies shal l 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 registered office of the applicant companies at least 48 hours before the meeting. The Chairperson and Alternate Chairperson appointed herein along with Scrutinizer shall ensure that the proxy registers are properly maintained. However, every endeavour should be made by the applicant companies to attain at least the quorum fixed, if not more in relation to approval of the scheme.
iv) The meetings shall be conducted either by way of physica l means or by video or other audio visual means enabled with e-voting as per applicable procedure prescribed under the MCA Circular MCA General Circular Nos. (i) 20/2020 dated 5th May, 2020 (AGM Circular), (ii) 14/2020, dated 08.04.2020 (EGM Circular-I) and (iii) 17/2020 dated 13.04.2020 (EGM Circular-II);
v) That individual notices of the above said meetings shall be sent by the Applicant Company through registered post or speed post or through courier or e-mail, 30 days in advance before the scheduled date of the meeting, indicating the day, date, the place and the time as aforesaid, together with a copy of Scheme, copy of explanatory statement, required to be sent under the Companies Act, 2013 and the prescribed form of proxy shall also be sent along and in addition to the above any other documents as may be prescribed under the Act or rules may also be duly sent with the notice.
v) That the Applicant Company shall publish advertisement with a gap of atleast 30 clear days before the aforesaid meetings, indicating the day, date and the place and time as aforesaid, to be published in the English Daily "Business Line" (All India Edition), and "Makkal Kural" Tamil (Tamil Nadu Edition) in Vernacular stating the copies of 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 registered office of the respective Applicant Companies.
vii) The Chairperson shall as aforestated be responsible to report the result of the meeting within a period of 3 days of the conclusion of the meeting with details of voting on the proposed scheme.
viii) The companies shall individually send notice to concerned Regional Director, MCA, the Income Tax Authorities, Registrar of Companies Chennai, Official Liquidator in respect of Transferor Company, Reserve Bank of India, Securities Exchange Board of India, Bombay Stock Exchange, as well as other Sectoral regulators who may have significant bearing on the operation of the applicant companies or the Scheme per se along with copy of required documents and disclosures required under the provisions of Companies Act, 2013 read with Companies (Compromises, Arrangements, Amalgamations) Rules, 2016.
ix) 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 creditor or member of the applicant companies entitled to attend the meetings as aforesaid.
x) The Authorized Representative of the Applicant Companies shall furnish an affidavit of service of notice of meetings and publication of advertisement and compliance of all directions contained herein at least a week before the proposed meetings.
xi) All the aforesaid directions are to be complied with strictly in accordance with the applicable law including forms and formats contained in the Companies (Compromises, Arrangements, Amalgamations) Rules, 2016 as well as the provisions of the Companies Act, 2013 by the Applicants.
The Applications stand allowed on the aforesaid terms.