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TMI Blog2022 (1) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... Amol Minechem Limited (Transferee Company') and their respective Shareholders and Creditors (hereinafter referred to as the Scheme ). The said Scheme shall be effective from the date of appointment as set out in the Scheme. 2. It is stated that both the petitioner companies are situated in the State of Gujarat, hence, both the companies are under the jurisdiction of the National Company Law Tribunal Bench at Ahmedabad. 3. The rationale of the proposed scheme of amalgamation is described as under:- (i) Simplification of group structure by eliminating multiple companies thus enabling focus on core competencies and unlocking of value. (ii) Greater efficiency in cash management of amalgamated entity and unfettered access to cash flow generated by the combined business which can be deployed more efficiently to fund organic and inorganic growth opportunities, to maximize shareholder value. (iii) Cost savings are expected to flow from more focused operational efforts, rationalization, standardization and simplification of business processes, productivity improvements, improved procurement, usage of common resource pool like human resource, administration, finance, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctive Shareholders and Creditors (Scheme of Amalgamation). 9. This Tribunal allowed the Company Application vide order dated 02.12.2020, inter alia, directed for convening meetings of the Equity Shareholders and Unsecured Creditors of the Petitioner Transferor Company as well as the Equity Shareholders, Secured Creditors and Unsecured Creditors of the Petitioner Transferee Company on 27.01.2021. This Tribunal appointed Mr. Munir Shah, Independent Practicing Chartered Accountant as the Chairman of the said meetings and Mr. Sharvil Suthar, Independent Practicing Company Secretary as the Scrutinizer of the aforesaid meetings and gave further directions to comply with various stipulations contained in the Order including filing of the Chairman's Report. 10. It was further directed by order dated 02.12.2020 to publish the notice of meetings in two newspapers Indian Express in English and Gujarati translation thereof in Gujarati daily Sandesh having circulation in Ahmedabad. The petitioner companies stated that newspaper publications were made in English daily Indian Express and Gujarati daily Sandesh Ahmedabad editions on 23rd December, 2020 and affidavits of service a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition not less than 10 days before fixed date of hearing, calling for objections, if any, on or before the date of hearing. The petitioner companies submitted that the notice of hearing of petition was published in vernacular language (Gujarati daily) 'Sandesh' and in English language (English daily) both in Ahmedabad editions. The affidavit of service and publication along with necessary proof of services to the statutory was filed on 18th March 2021. 15. In response to such notices, the Regional director filed an affidavit with the Tribunal on 2nd March 2021. The Office of the Official Liquidator also filed a report dated 17th March 2021. The Reserve Bank of India filed its representation dated 25th January 2021. 16. Following are the observations of Regional Director (RD) in its representation dated 02.03.2021:- i) Paragraph-2(a) with regard to the compliance of notice under Section 239(5) of the Companies Act, 2013, in paragraph-2(b) with regard to nature of the scheme/share exchange ratio and in paragraph-2(d) is with regard to rationale of the proposed Scheme of Amalgamation. ii) Paragraph-2(c) refers to the consolidated authorized share capital of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d status of the Company on MCA Portal confirms it to be an Unlisted Company. It is therefore submitted that the petitioner transferee company is not required to comply with SEBI guidelines for the present Scheme of Arrangement. (iv) Para 2(f) of the said representation refers to the investments made by foreign shareholders in case of both the petitioner Companies, and seeks confirmation about compliance of the applicable provisions of FEMA and RBI guidelines. The petitioner companies have confirmed the requisite compliances of the same and have further undertaken to comply with the applicable provisions while implementing the Scheme. The petitioner companies have confirmed the service of notice to the Reserve Bank of India as per the directions of the Hon'ble Tribunal vide order dated 2nd December 2020. The Reserve Bank of India vide its letter dated 25th January 2021 has indicated that the petitioner companies are required to comply with all applicable rules under FEMA Act and the RBI guidelines. The petitioner companies have undertaken to comply with all applicable rules and guidelines in this regard. (v) Vide para 2(g) of the affidavit, the Regional Director has re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial to the interest of its members or public interest, hence the petitioner transferor company may be dissolved without following the process of winding up. Further, the Official Liquidator has sought directions to be issued to preserve the books of accounts, papers and records of the Transferor Company and not to dispose of the same without prior permission of the Central Govt. as per the provisions of Section 239 of the Companies Act, 2013. There are no adverse observations against the petitioner Transferor Company. 19. It has been confirmed by the learned advocate for the petitioners that a copy of the said Additional Affidavit in response to the representations have been served upon the Regional Director, the Registrar of Companies as well as the Office of the Official Liquidator. 20. It is stated that no Representations were received from the Income Tax Authorities or any other regulatory authority for any of the companies. However, it is submitted that on the basis of the records of the Petitioner Companies, as on as on 28th February 2021, there are no disputed and/or undisputed outstanding demand for income tax for the petitioner Transferor company. There are small out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. The Scheme of Arrangement as annexed herewith as Annexure A is hereby sanctioned and it is declared that the same shall be binding on the Petitioner Companies and their Shareholders and Creditors and all concerned under the Scheme. 2. It is declared that the Transferor Company shall be dissolved without winding up. 3. All the property annexed herewith as Annexure B , right and powers of the Transferor Company specified in the schedule hereto and all the other property, rights and powers of the Transferor Company be transferred without further act or deed to the Transferee Company and accordingly the same shall pursuant to Section 232 of the Act, be transferred to and vested in the Transferee Company for all the estate and interest of the Transferor Company therein but subject nevertheless to all charges now affecting the same, if any. [other than (here set out any charges which by virtue of the compromise or arrangement are to cease to have an effect]. 4. All the liabilities and duties of the Transferor Company be transferred without further act or deed to the Transferee Company and accordingly the same shall pursuant to Section 232 of the Act, and become ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13. Any person aggrieved shall be at liberty to apply to the Tribunal in the above matter for any direction that may be necessary. 25. The Company Petition CP(CAA) No. 10 of 2021 connected with CA(CAA) No. 71 of 2020 is disposed of. No order as to costs. ANHEXURE-F SCHEME OP AMALGAMATION OF PERLCON PREMDX PRIVATE LIMITED (TRANSFEROR COMPANY) WITH AMOL MINECHEM LIMITED (TRANSFEREE COMPANY) (Formerly known as Amol Dicalite Limited) AND THEIR RESPECTIVE SHAREHOLDERS AND CREDITORS This Scheme is presented pursuant to the provisions of Section 230 to 232 and other relevant provisions of the Companies Act, 2013, as may be applicable, and also read with Section 2(1B) and other relevant provisions of the Income Tax Act 1961 (IT Act), as applicable for the amalgamation of the Transferor Company into and with the Transferee Company, on a going concern basis. 1. DESCRIPTION OF COMPANIES AND BACKGROUND A. Perlcon Premix Private Limited is a Private Limited Company incorporated on 11th July, 2010 under the provisions of the Companies Act, 1956, with the Registrar of Companies, Gujarat, Dadra and Nagar Havelli. The Corporate Identif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will help amalgamated entity in sharpening its competitiveness and developing its core competencies, in the long term, through cost savings and benefit of economies of scale. It would result in greater integration, greater financial strength and flexibility of the amalgamated entity which will improve the competitive position of the combined entity. 3. DEFINITIONS In the Scheme, unless repugnant to the meaning or context thereof, the following expressions shall have the following meanings: 3.1 Act or the Act means the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 and includes any alterations, modifications, amendments made thereto and/or any re-enactment thereof; 3.2 Transferor Company means Perlcon Premix Private Limited or 'PPPL' a company incorporated under Companies Act, 1956 having its registered office at 302, Akshay , 53, Shrimali Society, Navrangpura, Ahmedabad-380 009; 3.3 Transferee Company means Amol Minechem Limited or 'AML' a company incorporated under Companies Act, 1956 having its registered office at 401, Akshay , 53, Shrimali Society, Navrangpura Ahmedabad-380 009; 3.4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciate/subsidiary/joint venture companies, plant and machinery, equipment, furniture, fixtures, vehicles, stocks and inventory including, cables, leasehold assets and other properties, real, corporeal and incorporeal, in possession or reversion, present and contingent assets (whether tangible or intangible) of whatsoever nature, inverters, electrical fittings, submersible pumps, electrical erections, earthing and lighting systems, cash in hand, amounts lying in the banks, investments, escrow accounts, claims, powers, authorities, allotments, approvals, consents, letters of intent, registrations, contracts, engagements, arrangements, rights, credits, titles, interests, benefits, advantages, freehold/leasehold rights, brands, sub-letting tenancy rights, leave and license permissions, goodwill, other intangibles, industrial and other licenses, approvals, permits, authorisations, trademarks, trade names, patents, patent rights, copyrights, and other industrial and intellectual properties and rights of any nature whatsoever including know-how, websites, portals, domain names, or any applications for the above, assignments and (sic) in respect thereof, import quotas and other quota rights ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r customers and suppliers, customer credit information, customer pricing information and other records whether in physical or electronic form, in connection with or relating to the business of the Transferor Company. (g) all the employees, who are on the payrolls of the Transferor Company, employees/personnel engaged on contract basis and contract labourers and interns/trainees, engaged by the Transferor Company, at its respective offices, branches or otherwise, and any other employees/personnel and contract labourers and interns/trainees hired by the Transferor Company. All terms and words used in this Scheme shall, unless repugnant or contrary to the context or meaning thereof, have the same meaning ascribed to them under the Act, as applicable, the Income Tax Act and other applicable laws, rules, regulations, bye-laws, as the case may be or any statutory modification or re-enactment thereof for the time being in force. 4. SHARE CAPITAL 4.1 The capital structure of the Transferor Company as on 31st March 2020 is as under: There has been no change in the issued, subscribed and paid up share capital of PPPL till date. 4.2 The capital structure of the Transfer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of the same, be and stand transferred to and vested in the Transferee Company and/or be deemed to stand transferred to the Transferee Company as a part of the transfer of the Undertaking as a going concern so as to become from the Appointed date the assets and properties of the Transferee Company. The vesting pursuant to this sub-clause shall be deemed to have occurred by physical or constructive delivery or by endorsement and delivery or by vesting and recorded pursuant to this Scheme, as appropriate to the property being vested and title to the property shall be deemed to have been transferred accordingly. c) All other movable properties of the Transferor Company, including investments of all kinds, sundry debtors, receivables, bills, credits, loans and advances, if any, whether recoverable in cash or in kind or for value to be received, bank balances, deposits with any Government, quasi government, local or other authority or body or with any company or other person, shall without any further act, instrument or deed, cost or charge, be and shall stand transferred to and vested in the Transferee Company and/or deemed to have been transferred to and vested in the Transferee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d duly recorded in the name of the Transferee Company by the appropriate authorities pursuant to the sanction of this Scheme by the NCLT in accordance with the terms hereof. It is however clarified that the applicable stamp duty for such transfer on amalgamation under the order of the Hon'ble Tribunal shall be duly paid. f) All lease license or rent agreements entered into by the Transferor Company with various landlords, owners and lessors in connection with the use of the assets of the Transferor Company, together with security deposits and advance/prepaid lease/license fee, etc., shall stand automatically transferred and vested in favour of the Transferee Company on the same terms and conditions without any further act, instrument, deed, matter or thing being made, done or executed. The Transferee Company shall continue to pay rent or lease or license fee as provided for in such agreements, and the Transferee Company and the relevant landlords, owners and lessors shall continue to comply with the terms, conditions and covenants there-under. Without limiting the generality of the foregoing, the Transferee Company shall also be entitled to refund of security deposits paid u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against or in favour of the Transferee Company and may be enforced as fully and effectually as if, instead of the Transferor Company, the Transferee Company had been a party or beneficiary or obligor thereto. In relation to the same, any procedural requirements required to be (sic) solely by the Transferor Company (and not by any of its successors), shall be fulfilled by the Transferee Company as if it is the duly constituted attorney of that Transferor Company. i) Without prejudice to the generality of the foregoing, all leave and license agreements/deeds, lease agreements/deeds, bank guarantees, corporate guarantees, performance guarantees and letters of credit, hire purchase agreements, lending agreements and such other agreements, deeds, documents and arrangements pertaining to the business of the Transferor Company or to the benefit of which the Transferor Company may be eligible and which are subsisting or having effect immediately before the Effective Date, including all rights and benefits (including benefits of any membership, deposit, advances, receivables or claims) arising or accruing there from, shall, with effect from Appointed Date and upon this Scheme becoming e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ming such refunds or credits have lapsed. For the avoidance of doubt, Input Tax Credits already availed of or utilized by the Transferor Company and the Transferee Company in respect of inter se transactions shall not be adversely impacted by the cancellation of inter se transactions pursuant to this Scheme. m) All statutory rights and obligations of Transferor Company would vest on/accrue to Transferee Company. Hence, obligation of the Transferor Company, prior to the Effective Date, to issue or receive any statutory declaration or any other Forms by whatever name called, under the State VAT Acts or the Central Sales Tax Act or Central and/or State Goods and Services Tax Act or any other act for the time being in force, would be deemed to have been fulfilled if they are issued or received by Transferee Company and if any Form relatable to the period prior to the said Effective Date is received in the name of the Transferor Company, it would be deemed to have been received by the Transferee Company in fulfillment of its obligations. n) Benefits of any and all corporate approvals as may have already been taken by the Transferor Company, whether being in the nature of complianc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be deemed to have been transferred to and vested in the Transferee Company as a part of the transfer of the Undertaking as a going concern and the same shall be assumed by the Transferee Company and to the extent they are outstanding on the Effective Date on the same terms and conditions as were applicable to the Transferor Company, and the Transferee Company shall meet, discharge and satisfy the same. c) Any liabilities of the Transferor Company as on the Appointed Date that are discharged by the Transferor Company (sic) or after the Appointed Date but prior to the Effective Date, shall be deemed to have been discharged for and on account of the Transferee Company. d) All loans raised and utilized, liabilities, duties and taxes and obligations incurred or undertaken by the Transferor Company on or after the Appointed Date but prior to the Effective Date shall be deemed to have been raised, used, incurred or undertaken for and on behalf of the Transferee Company and shall stand transferred to and vested in and be deemed to have been transferred to and vested in the Transferee Company as a part of the transfer of the Undertaking as a going concern and the same shall be assumed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... superannuation fund, staff welfare scheme, etc., being maintained by the Transferee Company or as may be created by the Transferee Company for such purpose. Pending such transfer, the contributions required to be made in respect of such employees shall continue to be made by the Transferee Company to the existing funds maintained by the Transferor Company. 6.3 The Transferee Company undertakes that for the purpose of payment of any retrenchment compensation, gratuity and other terminal benefits to the employees of the Transferor Company, the past services of such employees with the Transferor Company shall also be taken into account and it shall pay the same accordingly, as and when such amounts are due and payable. Upon this Scheme becoming effective, the Transferor Company will transfer/handover to the Transferee Company, copies of employment information, including but not limited to, personnel files (including hiring documents, existing employment contracts, and documents reflecting changes in an employee's position, compensation, or benefits), payroll records, medical documents (including documents relating to past or ongoing leaves of absence, on the job injuries or ill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Transferor Company for the period commencing from the Appointed Date shall, for all purposes, be treated as and be deemed to be the profits, income, losses or expenditure, as the case may be, of the Transferee Company; (c) any of the rights, powers, authorities or privileges exercised by the Transferor Company shall be deemed to have been exercised by the Transferor Company for and on behalf of, and in trust for and as an agent of the Transferee Company. Similarly, any of the obligations, duties and commitments that have been undertaken or discharged by the Transferor Company shall be deemed to have been undertaken for and on behalf of and as an agent of the Transferee Company; (d) all taxes, where applicable, (including but not limited to advance income tax, tax deducted at source, minimum alternate tax, wealth tax, taxes withheld/paid in a foreign country, sales tax, valued added tax, goods and services tax, excise duty, customs duty, service tax, VAT, tax refunds) payable by or refundable to the Transferor Company, including all or any tax refunds or tax liabilities or tax claims arising from pending tax proceedings, under any law, on or before the Effective Date, sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the Transferor Company shall stand cancelled. 9.6 The issue and allotment of shares by the Transferee Company to the equity shareholders of the Transferor Company as provided in this Scheme as an integral part thereof, shall be deemed to have been carried out without any further act or deed by Transferee Company as if the procedure laid down under Section 62(1)(c) of the Act and any other applicable provisions were duty complied with. 10. ACCOUNTING TREATMENT Upon the scheme becoming effective the Transferee Company shall account for the amalgamation of the Transferor Company in the books of accounts in accordance with 'Pooling of Interest Method' of accounting as laid down in Appendix C of IND-AS 103 (Business Combinations of entities under common control) as under: 10.1 All the assets, and liabilities in the books of the Transferor Company shall be recorded by the Transferee Company in its books of accounts at their respective carrying amounts as appearing in the books the Transferor Company. No adjustment shall be made to reflect fair values, or recognize any new assets of liabilities. 10.2 The identity of the reserves of the Transferor Companies shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lve the said issue/s considering the provisions of the Act and applicable Accounting Standards. 11. DISSOLUTION OF THE TRANSFEROR COMPANY Upon the coming into effect of the Scheme, the Transferor Company shall, without any further act, instrument or deed, stand dissolved without following the process of Winding up. 12. CONSOLIDATION OF AVTHORISED SHARE CAPITAL AMD AMENDMENT OF MEMORANDUM OF ASSOCIATION 12.1 As an integral part of the Scheme, upon this Scheme becoming effective and with effect from Appointed Date, the authorised share capital of the Transferor Company amounting to ₹ 11,00,00,000/- or the amount as on the Effective Date shall, without any further act, instrument or deed or payment of filing fees payable to the Registrar of Companies or stamp duty, stand transferred to and be merged with the authorised share capital of the Transferee Company. 12.2 Clause V of the Memorandum of Association of the Transferee Company shall, without any further act, instrument or deed, stand altered, modified and amended pursuant to Sections 13, 61 and 62 of the Act and other applicable provisions of the Act, as the case may be and be replaced accordingly. 12.3 It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Scheme. 14. DIVIDEND 14.1 The Companies shall be entitled to declare and pay dividends, whether interim and/or final, to their members in respect of the accounting period prior to the Effective Date. 14.2 The holders of the shares of the Companies shall, save as expressly provided otherwise in this Scheme, continue to enjoy their existing rights under their respective Articles of Association including the right to receive dividends. 14.3 It is clarified that the aforesaid provisions in respect of declaration of dividends are enabling provisions only and shall not be deemed to confer any right on any member of the Companies to demand or claim any dividends which, subject to the provisions of the Act, as applicable, shall be entirely at the discretion of the respective Boards of Directors of the Companies, and subject to the approval, if required, of the respective members of the Companies. 15. APPLICATION 15.1 The Companies shall undertake requisite procedure for filing necessary application and petition before the Ahmedabad Bench of NCLT under Section 230 to 232 of the Act, seeking orders for dispensing with or convening, holding and/or conducting of the meeting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Transferor Company and the Transferee Company shall be entitled to, amongst other, file/or revise its income tax returns, TDS/TCS returns, wealth tax returns, service tax returns, Goods and Service Tax returns, excise returns, VAT returns, entry tax returns, professional tax returns or any other statutory returns, if required. The Transferee Company shall be entitled to claim credit for advance tax paid, tax deducted at source, claim for deduction of sum prescribed under Section 43B of the Income Tax Act on payment basis, claim for deduction of provisions written off by Transferor Company previously disallowed in the hands of Transferor Company under the Income Tax Act, credit of tax under Section 115JB read with Section 115JAA of the Income Tax Act, credit of foreign taxes paid/with held etc., if any, pertaining to the Transferor Company as may be required consequent to implementation of this Scheme and where necessary to give effect to this Scheme, even if the prescribed time limits for filing or revising such returns have lapsed without incurring any liability on account of interest, penalty or any other sum. The Transferee Company shall have the right to claim refunds, tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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