Delhi High Court
Awb Krishi Suvidha Parisar (Kota) ... vs ... on 29 August, 2016
IN THE HIGH COURT OF DELHI
COMPANY PETITION NO. 188/2016
Reserved on 3rd August, 2016
Date of pronouncement: 29th August, 2016
In the matter of
The Companies Act, 1956 & the Companies Act, 2013 (to the extent
applicable):
And
Petition under Sections 391 to 394 read with
Sections 100 to 103 of the Companies Act,
1956
Scheme of Amalgamation and Arrangement between:
AWB Krishi Suvidha Parisar (Kota) Private Limited
Petitioner/Transferor Company No. 1
AWB Krishi Upaaj Vipnan Parisar (Talera) Private Limited
Petitioner/Transferor Company No. 2
AND
AWB India Private Limited
Petitioner/Transferee Company
Through Mr. Rajeev Kumar, Advocate
for the petitioners
Ms. Aparna Mudiam, Asstt. Registrar
of Companies for the Regional Director
Mr. Sanjay Katyal, Advocate for the
Official Liquidator
SUDERSHAN KUMAR MISRA, J.
1. This joint petition has been filed under Sections 391 to 394 read
with Sections 100 to 103 of the Companies Act, 1956 by the petitioner
companies seeking sanction of the Scheme of Amalgamation and
Arrangement between AWB Krishi Suvidha Parisar (Kota) Private Limited
(hereinafter referred to as the transferor company no. 1); AWB Krishi
Upaaj Vipnan Parisar (Talera) Private Limited (hereinafter referred to as
the transferor company no. 2) and AWB India Private Limited (hereinafter
referred to as the transferee company).
2. The registered offices of the transferor and transferee companies
are situated at New Delhi, within the jurisdiction of this Court.
3. The transferor company no. 1 was originally incorporated under
the Companies Act, 1956 on 17th November, 2005 with the Registrar of
Companies, NCT of Delhi & Haryana at New Delhi under the name and
style of Kota Agri Infrastructure Private Limited. The company changed
its name to AWB Krishi Suvidha Parisar (Kota) Private Limited and
obtained the fresh certificate of incorporation on 25th January, 2006.
4. The transferor company no. 2 was incorporated under the
Companies Act, 1956 on 26th April, 2006 with the Registrar of
Companies, NCT of Delhi & Haryana at New Delhi.
5. The transferee company was incorporated under the Companies
Act, 1956 on 22nd February, 2005 with the Registrar of Companies, NCT
of Delhi & Haryana at New Delhi.
6. The present authorized share capital of the transferor company
no.1 is Rs.6,00,00,000/- divided into 60,00,000 equity shares of Rs.10/-
each. The issued, subscribed and paid up capital of the company is
Rs.4,62,32,700/- divided into 46,23,270 equity shares of Rs.10/- each.
7. The present authorized share capital of the transferor company
no.2 is Rs.4,00,00,000/- divided into 40,00,000 equity shares of Rs.10/-
each. The issued, subscribed and paid up capital of the company is
Rs.2,80,21,270/- divided into 28,02,127 equity shares of Rs.10/- each.
8. The present authorized share capital of the transferee company is
Rs.37,00,00,000/- divided into 37,00,000 equity shares of Rs.100/- each.
The issued, subscribed and paid up capital of the company is
Rs.32,89,50,800/- divided into 32,89,508 equity shares of Rs.100/- each.
9. Copies of the Memorandum and Articles of Association of the
transferor and transferee companies have been filed on record with the
joint application, being CA(M) 31/2016, earlier filed by the petitioners.
The audited balance sheets, as on 31st March, 2015, of the transferor
and transferee companies, along with the report of the auditors, had also
been filed.
10. A copy of the Scheme of Amalgamation and Arrangement has
been placed on record and the salient features of the Scheme have been
incorporated and detailed in the petition and the accompanying affidavit.
It is claimed by the petitioners that the proposed amalgamation would
result into a simple corporate structure and reduction of regulatory
compliances and costs. It is further claimed that the proposed Scheme
would also result in achieving better efficiency and streamlining
management control and operation of businesses and activities, optimum
resource utilization and correspondingly bring economy in administration
and operational overheads and elimination of inter-company
transactions.
11. So far as the share exchange ratio is concerned, the Scheme
provides that, upon coming into effect of this Scheme, the transferee
company shall issue and allot shares to the shareholders of the
transferor companies in the following ratio:-
"60 fully paid-up compulsorily convertible preference shares of
Rs.100/- each for every 809 equity shares of Rs.10/- each
held in the transferor company no. 1."
"01 fully paid-up compulsorily convertible preference shares of
Rs.100/- each for every 4,33,530 equity shares of Rs.10/-
each held in the transferor company no. 2."
12. It has been submitted by the petitioners that no proceedings under
Sections 235 to 251 of the Companies Act, 1956 or under the
corresponding provisions of the Companies Act, 2013 are pending
against the petitioner companies.
13. The Board of Directors of the transferor and transferee companies
in their separate meetings held on 12th January, 2016 have unanimously
approved the proposed Scheme of Amalgamation and Arrangement.
Copies of the Resolutions passed at the meetings of the Board of
Directors of the transferor and transferee companies have been placed
on record.
14. The petitioner companies had earlier filed CA (M) No. 31/2016
seeking directions of this court to dispense with the requirement of
convening the meetings of their equity shareholders, secured and
unsecured creditors, which are statutorily required for sanction of the
Scheme of Amalgamation and Arrangement. Vide order dated 22nd
February, 2016, this court allowed the application and dispensed with the
requirement of convening and holding the meetings of the equity
shareholders and unsecured creditors of the transferor and transferee
companies, there being no secured creditor of the petitioner companies,
to consider and, if thought fit, approve, with or without modification, the
proposed Scheme of Amalgamation and Arrangement.
15. The petitioner companies have thereafter filed the present petition
seeking sanction of the Scheme of Amalgamation and Arrangement. Vide
order dated 8th March, 2016, notice in the petition was directed to be
issued to the Regional Director, Northern Region, and the Official
Liquidator. Citations were also directed to be published in 'Business
Standard' (English) and 'Jansatta' (Hindi) Delhi editions. Affidavit of
service has been filed by the petitioners showing compliance regarding
service on the Official Liquidator and the Regional Director, Northern
Region and also regarding compliance regarding publication of citations
in the aforesaid newspapers on 5th April, 2016. Copies of the newspaper
clippings containing the publications have been filed along with the said
affidavit.
16. Pursuant to the notices issued, the Official Liquidator sought
information from the petitioner companies. Based on the information
received, the Official Liquidator has filed a report dated 18th July, 2016
wherein he has stated that he has not received any complaint against the
proposed Scheme of Amalgamation and Arrangement from any
person/party interested in the Scheme in any manner and that the affairs
of the transferor companies do not appear to have been conducted in a
manner prejudicial to the interest of their members, creditors or public
interest, as per second proviso of Section 394(1) of the Companies Act,
1956.
17. In response to the notices issued in the petition, Mr. Narender
Kumar Bhola, Regional Director, Northern Region, Ministry of Corporate
Affairs has filed his report dated 15th July, 2016. The Regional Director in
para 8 of his report has submitted that the transferee company is a wholly
owned subsidiary of AWB (Australia) Limited and the proposed Scheme
also involved capital reduction of the transferee company thereby
payment is due of an amount of Rs.20,25,72,262.20 (Aggregate
Distributable amount) mainly to AWB (Australia) Limited, Australia, a non-
resident shareholder which requires approval from the Reserve Bank of
India. Further, in para 10 of his report, the Regional Director has provided
the details of Income Tax demand/TDS assessment pending against the
petitioner companies. The said details have also been provided by the
Official Liquidator in para 4 of his report.
18. In response to the aforesaid observations, the petitioner
companies in the affidavit dated 16th July, 2016 of Mr. Rahul Kumar
Shrivastava, authorized signatory of the transferee company, have
undertaken that the transferee company will take all necessary approvals
of the Reserve Bank of India, if required, in relation to the amount to be
paid to non-resident shareholders upon capital reduction of the transferee
company. The transferee company has further undertaken that it shall be
liable in respect of the disputed income tax demand/TDS assessments
that are pending against the petitioner companies. The undertakings
given by the transferee company are accepted and it shall remain bound
by the same. Further, since the transferee company is not the subject
matter of dissolution and will remain in existence even after the sanction
of the Scheme, therefore, in case of any default by the company, the
ROC or other statutory authorities would be at liberty to take appropriate
action, as permissible in law, against the petitioner company. In view of
the aforesaid, the observations made by the Regional Director stand
satisfied.
19. No objection has been received to the Scheme of Amalgamation
and Arrangement from any other party. The petitioner companies, in the
affidavits dated 16th July, 2015 of Mr. Chetan Dhingra, authorized
signatory of the transferor company no. 1; Mr. Kamal Kandhari,
authorized signatory of the transferor company no. 2 and Mr. Rahul
Kumar Shrivastava, authorized signatory of the transferee company,
have submitted that neither the petitioner companies nor their counsel
have received any objection pursuant to the citations published in the
newspapers on 5th April, 2016.
20. Considering the approval accorded by the equity shareholders and
creditors of the petitioner companies to the proposed Scheme of
Amalgamation and Arrangement and the affidavits filed by the Regional
Director, Northern Region and the Official Liquidator not raising any
objection to the proposed Scheme of Amalgamation and Arrangement,
there appears to be no impediment to the grant of sanction to the
Scheme of Amalgamation and Arrangement. Consequently, sanction is
hereby granted to the Scheme of Amalgamation and Arrangement under
Sections 391 and 394 of the Companies Act, 1956. The petitioner
companies will comply with the statutory requirements in accordance with
law. Certified copy of this order be filed with the Registrar of Companies
within 30 days. It is also clarified that this order will not be construed as
an order granting exemption from payment of stamp duty as payable in
accordance with law. Upon the sanction becoming effective from the
appointed date of Amalgamation, i.e. 1st April, 2015, the transferor
companies no. 1 & 2 shall stand dissolved without undergoing the
process of winding up.
21. Learned counsel for the Official Liquidator prays that costs of at
least Rs.2,00,000/- should be paid by the petitioners keeping in view the
fact that the matter has involved examination of extensive records and
also prioritized hearings. Learned counsel for the petitioner companies
states that the same is acceptable to him. As already directed vide order
dated 03.08.2016, the petitioners shall deposit a sum of Rs.2,00,000/- by
way of costs with Delhi High Court Bar Association Lawyers Social
Security and Welfare Fund, New Delhi.
22. The petition is allowed in the above terms.
Dasti.
SUDERSHAN KUMAR MISRA, J.
August 29, 2016
