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TMI Blog2017 (1) TMI 1302X X X X Extracts X X X X X X X X Extracts X X X X ..... t, within two weeks from today, stating therein, that it will take over and defray all the liabilities of the Demerged Undertaking (as defined in the proposed scheme) of the Demerged Company. Notwithstanding the above, if there is any deficiency found or, violation committed qua any enactment, statutory rule or regulation, the sanction granted by this Court to the proposed scheme will not come in the way of action being taken, albeit, in accordance with law, against the concerned persons, directors and officials of the Petitioner Companies. - CO.PET. 438/2016 - - - Dated:- 25-1-2017 - MR SIDDHARTH MRIDUL J. Petitioner No.2/Resulting Company Through: Mr. Rajeev K Goel, Advocate for the Petitioners Ms. Aparna Mudium, Assistant Registrar of Companies for the Regional Director J U D G M E N T SIDDHARTH MRIDUL, J. 1. This joint petition has been filed under Sections 391(2), 394 and 100 to 104 of the Companies Act, 1956 (hereinafter referred to as the Act ), by Modi-Mundipharma Healthcare Pvt. Ltd. (hereinafter referred to as Demerged Company ) and Modi-Mundipharma Pvt. Ltd. (hereinafter referred to as Resulting Company ) seeking sanction to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. The circumstances which justify and/or necessitate the proposed scheme are, inter alia, stated to be as follows: - a) The Demerged Company is engaged in the business of over the counter healthcare and Lifestyle products, including products in categories of skin-care, hair-care, dietary supplements, anti-snoring, mosquito repellants and cholesterol management, both in the domestic and export markets. b) The nature of offerings; risk and returns of domestic and export segments of the business of the Demerged Company are distinct from each other in terms of: (i) Regulatory requirements applicable ill respective markets; (ii) Marketing know-how and infrastructure requirements; and (iii) Realization and margins, and working capital requirements. c) Further, the management of the Demerged Company is already witnessing a clear distinction in the manner of doing business in the domestic and the export markets in terms of the marketing efforts required to promote sales, tax and regulatory compliances, skill set required in the employees to cater to the respective markets, etc. Accordingly, it is felt necessary that separate manageme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Resulting Company have filed their reports in this behalf and the same are on record. 16. However, in so far as the liabilities of the Petitioner Companies qua provisions made for LTA, gratuity and leave encashment are concerned, an observation has been made in the said order dated 05.02.2016 that the said liabilities of the Petitioner Companies shall be examined at the sanction/confirmation petition stage as they were not due and payable at the time of filing of the said Company Application (M) No.19 of 2016. The relevant para of the said order dated 05.02.2016, in this behalf, reads as hereinunder: 10.4 In so far as the provisions made qua LTA, leave encashment and gratuity are concerned, amounts shown against them have not been expended as due dates have not been reached. 10.5 In this context, the learned counsel for the applicants has made a submission that outstanding dues referred to in Table A and B should not form part of the class of persons / entities who represent unsecured creditors, at the stage of first motion. In other words, a request was made that no separate meeting be called qua the said statutory and other dues as reflected in Table A and B a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of this Scheme, and such transfer shall be automatically effected, or in any manner as may be mutually agreed by the Demerged Company and Resulting Company, from the Effective Date. 6.2.3. Any and all immovable properties, if any, owned or held by the Demerged Undertaking, and any documents of title, rights and easements, if any, held by the Demerged Undertaking thereto shall without any further act, instrument or deed be transferred to and/or vested in and/or be deemed to have been transferred to and vested in the Resulting Company and shall belong to the Resulting Company. 6.2.4. Any and all debts, liabilities, contingent liabilities, duties and obligations of every kind, nature and description of Demerged Undertaking shall also, under the provisions of Sections 391 to 394 of the Act, without any further act or deed, be transferred to or be deemed to be transferred to the Resulting Company so as to become the debts, liabilities, contingent liabilities, duties and obligations of Resulting Company and it shall not be necessary to obtain the consent of any third party or other person who is a party to any contract or arrangement by virtue of which such debt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Regional Director, Northern Region, Ministry of Corporate Affairs. Furthermore, vide said order dated 18.05.2016, citations were directed to be published in the newspapers, namely, Business Standard (English) and 'Business Standard (Hindi). Affidavit of service and publication, dated 28.07.2016, showing compliance regarding publication of citations in the aforesaid newspapers and service of petition paper book on the Regional Director and the Registrar of Companies, has been filed by the Resulting Company. Copies of the newspaper clippings, regarding publication carried out on 30.06.2016 have also been filed alongwith the said affidavit. 20. Further, in response to the notices issued in the present petition, the Regional Director, Northern Region, Ministry of Corporate Affairs, has filed its affidavit dated 04.10.2016, wherein, inter alia, no objection has been raised to the proposed scheme subject to clarification by the Petitioner Companies with respect to the following observations made by the Registrar of Companies: - 9. That the Deponent states that the Registrar of Companies, Delhi Haryana vide para 31 of his report has following observations:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Resulting Company, being the parent company, holds the entire share capital as well as the debentures of the Demerged Company. d) Post Scheme, all the fully Convertible Debentures issued by the Demerged Company, which are held by the Parent Resulting Company, will be cancelled in terms of the Scheme as the same represents an inter-corporate loan between the Demerged Undertaking and the Resulting Company. e) Further, as part of re-organization of share capital of the Demerged Company post De-merger, out of the total issued and paid up share capital consisting of 9,50,000 Equity Shares of ₹ 10 each, 9,00,000 Equity Shares of ₹ 10 each will be cancelled against a payment of ₹ 1,00,000 to the Resulting Company. Post De-merger, the Demerged Company will have 50,000 Equity Shares of ₹ 10 each aggregating ₹ 5.00 lakhs held by the Resulting Company. f) The consideration of ₹ 1.00 lakh for cancellation of 9,00,000 equity shares of ₹ 10 each aggregating ₹ 90.00 lakhs has been determined in view of the accumulated losses of the Demerged Company. g) It is submitted that Sections 100 to 104 of the Companies Act, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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