Jones Lang Lasalle Meghraj ... vs Jones Lang Lasalle Building ...
2016 Latest Caselaw 6265 Del

        IN THE HIGH COURT OF DELHI AT NEW DELHI


                                      Judgment delivered on: 28.09.2016


CO.PET. 368/2016



Jones Lang LaSalle Meghraj Building Operations (NCR) Private Limited

                          Transferor Company-I/ Petitioner Company-I

                                  AND

Homebay Residential Private Limited

                        Transferor Company-II/ Petitioner Company-II

                                  AND

Workplace Projects Private Limited

                      Transferor Company-III/ Petitioner Company-III

                                  AND

Jones Lang LaSalle Building Operations Private Limited

                          Transferee Company/ Petitioner Company-IV



                         Through: Mr. Satwinder Singh, Advocate for
                                  the petitioners
                                  Ms. Aparna Mudiam, Assistant
                                  Registrar of Companies for the
                                  Regional Director
                                  Mr. Rajiv Bahl, Advocate for the
                                  Official Liquidator


CO.PET.368/2016                                              Page 1 of 14
 CORAM:
HON'BLE MR JUSTICE SIDDHARTH MRIDUL

SIDDHARTH MRIDUL, J

1.

The present is a Second Motion Petition filed jointly by Jones Lang

LaSalle Meghraj Building Operations (NCR) Private Limited (Transferor

Company-I/NCR), Homebay Residential Private Limited (Transferor

Company-II/HRPL), Workplace Projects Private Limited (Transferor

Company-III/WPPL) with Jones Lang LaSalle Building Operations Private

Limited (Transferee Company/JLLBO) under Sections 391 and 394 of the

Companies Act, 1956 (hereafter referred to as "the Act") for approval of the

Scheme of Amalgamation (hereafter referred to as "the Scheme").

2. The Transferor Companies Nos. I-III, have been hereinafter, jointly

referred to as "Transferor Companies". The Transferor Companies and the

Transferee Company, have been hereinafter, jointly referred to as "the

Petitioners".

3. The registered offices of the Petitioners are situated in the National

Capital Territory of Delhi, and therefore, this Court has the necessary

jurisdiction to adjudicate the present petition.

4. The details of the date of incorporation of the Petitioners, authorized

share capital, issued, subscribed and paid up capital of the Petitioners, have

been set out in paragraphs 1-3 of the Scheme. The same is enumerated in the

following paragraphs:

i. Transferor Company-I/NCR was incorporated on 29th March, 2000

under the provisions of the Act.

The authorized share capital of Transferor Company-I/NCR is

Rs.30,00,000/- (Rupees Thirty Lakhs only), divided into 3,00,000

(Three Lakh) equity shares of the face value of Rs.10/- each. While

the issued, subscribed and paid-up share capital of Transferor

Company-I/NCR is Rs.25,00,000/- (Rupees Twenty Five Lakhs Only),

divided in to 2,50,000 (Two Lakh Fifty Thousand) equity shares of

Rs.10/-each.

ii. Transferor Company-II/HRPL was incorporated on 9th August, 2006

under the provisions of the Act.

The authorized share capital of Transferor Company-II/HRPL is

Rs.10,00,000/- (Rupees Ten Lakhs only), divided in to 1,00,000 (One

Lakh) equity shares of Rs. 10/- each. While the issued, subscribed and

paid-up share capital of Transferor Company-II/HRPL is

Rs.10,00,000/- (Rupees Ten Lakhs only), divided into 1,00,000 (One

Lakh) equity shares of Rs. 10/- each.

iii. Transferor Company-III/WPPL was incorporated on 18th April 2005

under the provisions of the Act.

The authorized share capital of Transferor Company-III/ WPPL is

Rs.10,00,000/- (Rupees Ten Lakhs only), divided in to 1,00,000 (One

Lakh) equity shares of Rs. 10/- each. While the issued, subscribed and

paid-up share capital of Transferor Company-III/WPPL is Rs.

1,00,000/- (Rupees One Lakh only), divided into 10,000 (Ten

Thousand) equity shares of Rs. 10/- each.

iv. The Transferee Company (JLLBO) was incorporated on 1 st November,

2002 under the provisions of the Act.

The authorized share capital of the Transferee Company (JLLBO) is

Rs.50,00,000/- (Rupees Fifty Lakhs Only), divided into 5,00,000 (Five

lakh) equity shares of Rs.10/- each. While the issued, subscribed and

paid-up share capital of the Transferee Company (JLLBO) is

Rs.5,00,000/- (Rupees Five Lakhs Only), divided in to 50,000 (Fifty

Thousand) equity shares of Rs.10/-each.

5. It has been averred on behalf of the Petitioners that there are no

proceedings pending against them, under Sections 235 to 251 of the Act

(including their corresponding sections of the Companies Act, 2013).

6. It has been further submitted on behalf of the Petitioners that the

Scheme has been approved by the respective Board of Directors (BOD) of

the Petitioners. The copies of the BOD resolutions dated 12.08.2015,

27.08.2015, 25.08.2015 and 17.08.2015 with respect to Petitioner No.1, 2, 3

and 4, respectively, have been filed and the same are on record.

7. The Copies of the Memorandum of Association and Articles of

Association, of each of the Petitioners, have been duly filed as Annexures to

Company Application (M) No. 20 of 2016 (Application for First Motion),

which earlier came to be filed by the Petitioners. The same are on record.

The audited financial statements, as on March 31, 2015, pertaining to each of

the Petitioners, have also been duly filed by all the Petitioners and the same

are on record.

8. A copy of the Scheme has been duly placed on record and the salient

features of the Scheme have been incorporated and detailed in the present

petition and the accompanying affidavit. It has been urged on behalf of the

Petitioners that the proposed amalgamation of the Transferor Companies,

with and into the Transferee Company would, inter alia, entail the following

benefits:

      (i)    A simplified corporate structure;




       (ii)     Rationalisation of administrative and operative costs;

(iii) Financial resources, managerial, technical and marketing expertise

of the Transferor Companies and the Transferee Company shall be

available to the amalgamated company; and

(iv) The amalgamation would provide synergistic linkages besides

economies in costs and other benefits resulting from the

economies of scale, by combining the businesses and operations of

the Transferor Companies and the Transferee Company.

9. The Share Exchange Ratio for the Amalgamation has been provided

for in the Scheme. The relevant terms of Clause 4.13 of the Scheme,

providing for the same, are summarized hereinbelow:

(i) Transferor Company-I/NCR is a wholly owned subsidiary of the Transferee Company (JLLBO).

Therefore, the Transferee Company (JLLBO) shall not issue any shares to the shareholders of Transferor Company-I/NCR upon coming into effect of the Scheme, and in consideration of the amalgamation of Transferor Company-I/NCR into the Transferee Company (JLLBO).

(ii) Upon the Scheme becoming effective and in consideration of and subsequent to the amalgamation of Tranferor Company-II/HRPL with and into Transferee Company (JLLBO) in terms of Part - III of the Scheme, the Transferee Company (JLLBO) shall issue and allot,

in respect of all the equity shares of face value of Rs.10 each, fully paid up, 100 (Hundred) equity shares of Rs.10 each, fully paid up. The shares are to be issued to the shareholders of Transferor Company-II/HRPL whose name is recorded in the register of members of Transferor Company-II/HRPL on Record Date. The consideration issued by Transferee Company (JLLBO) to the shareholders of Transferor Company-II/HRPL is approved by the Board of Directors of Transferee Company (JLLBO) and Transferor Company-II/HRPL, based on their independent judgment and after taking into consideration the opinion dated 01 August 2015 on share swap ratio as provided by M/s Aayush Garg & Associates.

(iii) Upon the Scheme becoming effective and in consideration of and subsequent to the amalgamation of Transferor Company-III/WPPL with and into the Transferee Company (JLLBO) in terms of Part - III of the Scheme, the Transferee Company (JLLBO) shall issue and allot, in respect of all the equity shares of face value of Rs.10 each, fully paid up, 100 (Hundred) equity shares of Rs.10 each, fully paid up. The shares are to be issued to the shareholders of Transferor Company- III/WPPL whose name is recorded in the register of members of Transferor Company-III/WPPL on Record Date. The consideration issued by Transferee Company (JLLBO) to the shareholders of Transferor Company- III/WPPL is approved by the Board of Directors of Transferee Company (JLLBO) and Transferor Company- III/WPPL, based on their independent judgment and after taking into consideration the opinion dated 1 st August, 2015 on share swap ratio as provided by M/s Aayush Garg & Associates.

10. To recapitulate, the Petitioners had, in the earlier round, filed an

application (i.e. application for the First Motion), being Company

Application (M) No. 20 of 2016, whereby a prayer was sought, seeking

directions for dispensing with the requirement of convening meetings of the

equity shareholders and secured creditors of the Petitioners and unsecured

creditors of the Transferor Companies in lieu of consents obtained from all

the equity shareholders of the Petitioners and the consents obtained from the

secured creditors of the Transferee Company. This Court vide order dated 8 th

February, 2016 was pleased to allow the application and dispensed with the

requirement of convening meetings of the equity shareholders and secured

creditors of each of the Petitioner Companies. The meetings of the unsecured

creditors of Transferor Company-II/HRPL and Transferor Company-

III/WPPL were also dispensed with. It has been stated that the Transferor

Companies have no secured creditors.

11. Further, this Court, by way of its order dated 8 th February, 2016,

directed the convening of the meetings of the unsecured creditors of the

Transferor Company-I/NCR and the Transferee Company (JLLBO) to

consider and, if thought fit, approve with or without modification, the

proposed Scheme.

12. The meetings of the unsecured creditors of Transferor Company-

I/NCR and the Transferee Company (JLLBO) were duly convened and the

Scheme was approved without any modification by the requisite majority of

unsecured creditors present and voting at the said meetings, in terms of

Section 391(2) of the Companies Act, 1956. The Chairpersons of the said

meetings have duly filed their reports dated 18.04.2016, which reflect the

results of the said meetings on 18th April, 2016 and the same are on record.

13. Pursuant to the same, the Petitioners, have filed the instant petition

(i.e. Second Motion). Notice in this petition was issued by this Court, by

way of the order dated 04.05.2016. Notice was accepted on behalf of the

Official Liquidator (OL) and the Regional Director (RD), Northern Region.

13.1 Furthermore, vide order of this Court dated 04.05.2016, citations were

directed to be published. It has been noted that Citations were published, on

20.06.2016, in Delhi Editions of the newspapers, namely, 'Financial

Express' (English, Delhi Edition) and 'Jansatta' (Hindi, Delhi Edition), in

compliance with the order of this Court dated 04.05.2016. An affidavit dated

21.09.2016 demonstrating service of the petition on the Official Liquidator,

Registrar of Companies and the Regional Director, Northern Region.

14. Pursuant to the notices issued, report of the Official Liquidator (OL)

dated 20.09.16 has been filed, wherein, inter alia, it has been stated that the

OL has not received any complaint qua the Scheme from any interested

person or party. Further, it has been stated in the said report dated

20.09.2016, that on the basis of information supplied by the petitioners, it

appears, that the affairs of the transferor companies have been conducted in a

manner which could not be construed as being prejudicial to either the

interest of their members or the public at large.

15. In other words, it has been stated by the OL in the report dated

20.09.2016 that the affairs of the transferor companies, do not fall foul of the

provisions of the Second Proviso to Section 394(1) of the Act. Thus, it has

been averred on behalf of the OL, in effect, that he would have no

objections, if this Court were to sanction the Scheme.

16. Further, in response to the notices issued in the Petition, Sh. Narender

Kumar Bhola, Regional Director, Northern Region, Ministry of Corporate

Affairs, filed his affidavit dated 15.09.2016 wherein, inter alia, it has been

stated that he has no objection to the sanction of the proposed Scheme,

except the objections enumerated in para 5 of the said report dated

15.09.2016, stating that there are certain pending (disputed) liabilities against

the Petitioners.

17. In response to the aforesaid affidavit filed by RD, the Petitioner

Companies have filed a joint reply wherein, it has been stated that in terms

of Clauses 4.6.1, 4.6.2 and 4.6.4 of the Scheme, the pending tax liabilities of

the Transferor Companies shall be transferred to the Transferee Company

(JLLBO) and any income tax proceedings pending by or against the

Transferor Companies, shall be continued and enforced by or against the

Transferee Company (JLLBO) upon the Scheme of Amalgamation coming

into effect. Further, the Transferee Company (JLLBO) has undertaken that

the Transferee Company (JLLBO) will pay the income tax liabilities of the

Transferor Companies, as and when such liabilities arise.

18. Ms. Aparna Mudiam, Assistant ROC appearing on behalf of the RD,

Northern Region, states that in view of the undertaking made on behalf of

the petitioners, that the outstanding liabilities, as enumerated in the report

filed by the RD dated 15.9.2016, shall be discharged by the Transferee

company, the objection raised vide affidavit of the RD dated 15.09.2016,

stands satisfied and that no further objections against the present Scheme

remain.

19. It has been noted that no objection has been received to the Scheme

from any other party. The Petitioners, vide affidavit dated 21st September,

2016, have submitted that neither the Petitioners nor their counsel have

received any objection pursuant to the citations published in the newspapers

dated 20th June, 2016.

20. In view of the foregoing, upon considering the approval accorded by

the members and creditors of the Petitioners to the proposed Scheme, and the

affidavits filed by the Regional Director, Northern Region, Ministry of

Corporate Affairs and the Official Liquidator attached to this High Court,

whereby no objections have been raised to the proposed Scheme, there

appears to be no impediment to the grant of sanction to the Scheme.

Consequently, sanction is hereby granted to the Scheme under section 391

and 394 of the Companies Act, 1956. The Petitioners will however, comply

with the statutory requirements in accordance with law.

21. A certified copy of the order, sanctioning the scheme, be filed with the

ROC, within thirty (30) days of its receipt.

22. Resultantly, it is hereby directed that the petitioners will comply with

all provisions of the scheme and, in particular, those which are referred to

hereinabove.

23. In any event, notwithstanding what has been stated on behalf of the

petitioners hereinabove, the transferee company (JLLBO) will file an

undertaking with this court, within two weeks from today, stating therein,

that it will take over and defray all liabilities of the transferor company. It is

also made clear, that the concerned Statutory Authority will be entitled to

proceed against the transferee company qua any liability which it would

have fastened onto the transferor companies for the relevant period, and that,

which may arise on account of the scheme being sanctioned.

24. 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 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 petitioners.

25. The transferor companies shall stand dissolved without being wound

up.

26. It is made clear, that this order shall not be construed as an order

granting exemption, inter alia, from, payment of stamp duty or, taxes or, any

other charges, if, payable, as per the relevant provisions of law or, from any

applicable permissions that may have to be obtained or, even compliances

that may have to be made, as per the mandate of law.

27. Learned counsel appearing on behalf of the Official Liquidator prays

that costs of at least Rs.1,00,000/- may be paid by the petitioners, keeping in

view the fact, that the matter called for examination of extensive records and

prioritised hearings. Learned counsel appearing on behalf of the petitioners

states that the same is acceptable to him.

28. In view of the foregoing, the petitioners shall deposit a sum of

Rs.1,00,000/- by way of costs, with the Common Pool Fund of the Official

Liquidator, Delhi.

29. Consequently, the petition is allowed and disposed of, in the aforesaid

terms.

30. A copy of this order be given dasti under the signatures of the Court

Master.

SIDDHARTH MRIDUL, J SEPTEMBER 28, 2016 dn