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TMI Blog2018 (4) TMI 1778X X X X Extracts X X X X X X X X Extracts X X X X ..... he Scheme as envisaged in the provisions of section 230(4) of the Companies Act, 2013. Taking in consideration of the shareholders whose shares are cancelled this Tribunal directed the Transferee Company to consider to make payment to the shareholders whose shares were cancelled in terms of respective clauses of the scheme and on the intervention of this Tribunal, the Transferee Company accepted to make payment to the objector at the book value as on 01.04.2016, the appointed date, however, without prejudice to the submissions made on the locus standi of the objector - The scheme does not require any modification other than mentioned at para 16 above and the said scheme of Arrangement and Amalgamation appears to be fair and reasonable, not contrary to public policy and also not violative of any provisions of law, all the statutory compliances have been made under the Companies Act, 2013. The scheme of Arrangement and Amalgamation annexed with the petition is hereby sanctioned which shall binding on all the member, creditors and shareholders - Petition allowed. - CP/159, 160, 161, 162, 163, 164 & 165/CAA/2017 [CA/95, 96, 97, 98, 99, 100 & 101/CAA/2017] - - - Dated:- 12-4-201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itors Unsecured Creditors Transferor Company-1 342/2 Nil Nil Transferor Company-2 120 254/3 Nil Nil Transferor Company-3 2/2 Nil Nil Transferor Company-4 5,70,700 8/0 Nil 3 Transferor Company-5 Transferor Company-6 Demerged Company-I 9/0 Nil Nil Demerged Company-2 506/509 Nil 1 Transferee Company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd out of 14 equity shareholders, all the 14 shareholders attended the meeting with the shareholding 25,64,546 amounting to 100% voted in favour of the scheme and none of them have voted against the resolution. The meeting of the preference and equity shareholders of the demerged company - 2 was also conducted as per the direction of this tribunal and out of 9 equity shareholders all the 9 equity shareholders were present at the meeting of the shareholders, holding 98,48,233 amounts to 100 % voted in favour of the scheme and none of them have voted against the resolution. The scheme was approved by both the equity shareholders and preference shareholders with requisite majority and the chairman's reports have also been filed in this regard. The petitioner companies complied with all the orders passed by this bench. 5. Shri. P.H. Arvindh Pandian, learned Senior Counsel for the petitioner companies submitted that the rational of scheme is that simplification of group structure by elimination of multiple entities and achieve greater administrative efficiency, elimination of administrative functions and multiple record keeping, thus resulting in reduced expenditure and unlocking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held, I fully paid up equity share of ₹ 100/- for every 4,44,255 -10% Redeemable Non-Cumulative Preference shares of ₹ 10/- each held and 1 fully paid up equity share of ₹ 100/- each for every 4,44,255 10% eighties Redeemable Non-Cumulative Preference shares of ₹ 10/- each held in the Transferor Company - 4. The OL has submitted that the company petitions may be decided on merits. 9. The Regional Director, Southern Region (in short RD) in his report affidavit (in short report) dated 10.11.2017 made the following comments: (a) The divesting of the shares/investments from the demerged companies (1) and (2) pertaining to cement business of the Dalmia Group Companies is only a transfer of shares and not transfer of a business or business undertaking and hence could not be considered as scheme of demerger/arrangement u/s 230 to 232 of the Companies Act, 2013 as well under the provisions of section 2(AA) ofthe IT Act, 1961; (b)How the minority equity and preference shareholders in the second demerged company will be issued with shares or compensated for the fractional holding i.e. who holds less than 1636 equity shares and also the minority preference sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0.51 shares. Since the fractional entitlement would be rounded off to nearest integer, the shareholder holding 116 shares would get at least 1 share of ₹ 100/- each and there are 23 shareholders holding less than 116 shares. By the present scheme the Transferee Company is sending out all the public shareholders of the transferor company except the shareholders holding 47 shares. (4) A private company can only have a maximum of 200 members as per section 2(68) of the Companies Act, 2013 and if the scheme is approved, the Transferee Company would have more than 200 members. In order to avoid seeking approval of the shareholders from converting the company from Private Limited to Public Limited due to the increase of shareholders more than 200, the Transferee Company is seeking to send out majority of the public shareholders without even repaying their entitlement. Post the scheme the only the promoters would be holding majority shares and only the public would hold only 47 shares. The notice does not speak about repayment of capital to the public shareholders and therefore the scheme is a fraud committed on the public shareholders. (5) According to the scheme the balance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anies Act, 2013 and the clauses 1.11, 1.12 and 6.1 of the scheme, it is clear that the undertakings proposed to be demerged from the Demerged Companies 1 and 2 to the Transferee Company would constitute an undertaking for the purposes of the Companies Act, 2013 since the criteria laid down in explanation to section 180 being met. (ii) The Demerged Company -2 was directed to convene, conduct and hold the meeting of the preference and the equity shareholders by the Hon'ble Tribunal vide its order dated 30.06.2017 and accordingly notice of meeting was sent to all the shareholders and the meeting was convened on 17.08.2017. The scheme was approved by the majority of the members present and voting and except for one, none of the other shareholders of the Demerged Company-2 have opposed the scheme. Only one shareholder of the Transferor Company-I had opposed the scheme and according to the direction given by the Hon'ble Tribunal the shareholders meeting of the Transferor Company-I was also convened and the scheme was approved by the majority of the shareholders. (iii) With regard to the comment of deemed profit, the learned Senior Counsel submitted that the copy of the sche ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... areholding is not entitled to oppose the scheme and his objections are need not be considered. 13.In view of the above submissions, the learned senior counsel prayed for allowing the scheme as prayed for in the petitions. 14.Heard the respective parties and perused the documents filed by the Regional Director, Official Liquidator and the Objector. 15.The petitioners have clarified the objections raised by the Regional Director, Southern Region which are also part of objections of the objector. It is a fact that the notices have been issued to all the statutory authorities and except the Regional Director, the Income Tax Authorities have not submitted any objections to the Scheme. It is also a fact that the Transferee Company is going to record the cancelled portion of the capital to capital reserve and there is no repayment to the shareholders whose shares are cancelled. It is also on record that the Objector does not possess the requisite qualification to oppose the Scheme as envisaged in the provisions of section 230(4) of the Companies Act, 2013. Taking in consideration of the shareholders whose shares are cancelled this Tribunal directed the Transferee Company to cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsideration all the above, the company petitions are allowed and the scheme of Arrangement and Amalgamation annexed with the petition is hereby sanctioned which shall binding on all the member, creditors and shareholders. 19. While approving the scheme as above, we further clarify that this order will not be construed as an order granting exemption from payment of stamp duty or taxes or any other charged, if payable, as per the relevant provisions of law or from any applicable permissions that may have to be obtained and compliances that may have to be made as per the mandate of law. 20. The Transferee Company is directed to file the amended MOA and AOA with ROC, Chennai. 21.The Transferor companies 1-4 shall be dissolved without winding up from the date of filing of the certified copy of this order with the ROC. 22. Upon receiving the certified copy of this order, the ROC, Chennai is directed to place all documents relating to the Transferor Companies 1 to 4 with that of the Transferee Company and the filed relating to the Transferor Companies 1 to 4 shall be consolidated with the files and records of the Transferee Company. 23.The Transferor Companies 1-4 are also ..... X X X X Extracts X X X X X X X X Extracts X X X X
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