Advance Agencies Private Limited & Ors. v. Official Liquidator

1. This second motion joint Petition has been filed under sections 391 to 394 of the Companies Act, 1956 (“Act”) seeking sanction to the Scheme of Amalgamation (“Scheme”) of Advance Agencies Private Ltd (Transferor Company No. 1), Suvi Consultants and Engineers Private Ltd (Transferor Company No. 2), Radhey Tradecom Private Ltd (Transferor Company No. 3), Rite Choice E-Services 2014:DHC:3584 CO.PET. 610 /2013 2 Private Ltd (Transferor Company No. 4) and Moon Light Consultancy Private Ltd (Transferor Company No.5) with Splendor Constructions Private Ltd (Transferee Company) (Collectively referred to as the Petitioner Companies). A copy of the Scheme has been enclosed with the Petition.

2. The registered offices of the Petitioner Companies are situated at New Delhi, within the jurisdiction of this Court.

3. The details of respective dates of incorporation of the Petitioner Companies, their authorised, issued, subscribed and paid up capital have been set out in the petition.

4. The copies of the Memorandum and Articles of Association of the Petitioner Companies have been enclosed with the petition.

5. The copies of Resolutions passed by the Board of Directors of the Petitioner Companies approving the Scheme have also been filed along with the petition.

6. Learned counsel for the Petitioner Companies submits that no proceedings under sections 235 to 251 of the CO.PET. 610 /2013 3 Companies Act, 1956 is pending against the Petitioner Companies.

7. The Petitioner Companies had earlier filed CA (M) 143 of 2013 seeking directions of this Court for dispensation/convening of meetings. Vide Order dated 22nd October, 2013, this Court allowed the Application and requirement of convening all the meetings of Shareholders (Class 1, 2 & 3) and Un-secured Creditors of the Transferor Companies and the Transferee Company; and the Debenture holders of the Transferor Companies are dispensed with. None of the Transferor Companies and the Transferee Company had any Secured Creditors.

8. The Petitioner Companies had thereafter filed the present Petition seeking sanction to the Scheme of Amalgamation. Vide Order dated 25th November, 2013, notice of the Petition was directed to be issued to the Region, Ministry of Corporate Affairs, and the Official Liquidator attached with this Court. Citations were also directed to be published in „Business Standard‟ (English, Delhi Edition) and „Dainik Bhaskar‟ (Hindi, Delhi Edition). Affidavit of Service and Publication has CO.PET. 610 /2013 4 been filed by the Petitioners showing compliance regarding service of the Petition on the Regional Director, Northern Region and the Official Liquidator, and also regarding publication of citations in the aforesaid newspaper. Copies of the newspaper cuttings, in original, containing the publications have also been filed along with the Affidavit of Service.

9. In response to the notice issued, the Official Liquidator sought information from the Petitioner Companies. Based on the information received, learned Official Liquidator has filed his report dated 01st April, 2014, wherein he has stated that he has not received any complaint against the proposed Scheme from any person/party interested in the Scheme in any manner and that the affairs of the Transferor Companies, which are subject matter of dissolution, do not appear to have been conducted in a manner prejudicial to the interest of its members, creditors or to public interest as per the 2nd Proviso of section 394(1) of the act.

10. In response to the notice issued in the Petition, learned Regional Director, Northern Region, Ministry of Corporate Affairs has filed his Affidavit/Report dated 22nd July, 2014. Relying on the Scheme of CO.PET. 610 /2013 5 Amalgamation, he has stated that, upon sanction of the Scheme, all the employees of the Transferor Companies shall become the employees of the Transferee Company without any break or interruption in their services.

11. The Learned Regional Director has, in its Affidavit, stated that the Registrar of Companies, Delhi has reported that all the Transferor and Transferee Companies are closely held companies. It appears that the proposed Scheme of Amalgamation is consolidation of such funds collected and invested in past into Transferee Company. Further submits that despite notice, the Income tax Authorities has not raised any observation with regard to the scheme.

12. In response to the aforesaid observations, the Petitioner Transferee Company in the Reply Affidavit dated 28th July, 2014, has submitted that all the Petitioner Transferor and Transferee Companies are Core Investment Companies (CIC) as defined in the Core Investment Companies (Reserve Bank) Directions, 2011, issued by the Reserve Bank of India and as per the said Directions, Core Investment Companies are not required registration from the RBI as NBFC. RBI‟s No CO.PET. 610 /2013 6 Objection Certificate is also not required for amalgamation of Core Investment Companies. The Petitioner Transferee Company has undertaken that it will comply with all the requirements of the Reserve Bank of India and will take other necessary steps in this regard, if any. Further, the Petitioner Companies and their Directors have also undertaken that they will be bound for any action which may be taken by the RBI in future for any act of commission or omission by the Petitioner Companies with regard to NBFC regulations.

13. In view of the aforesaid clarification and undertaking given by the Petitioner Companies, the concerns of the Regional Director have been duly addressed.

14. No objection has been received to the Scheme of Amalgamation from any other party. Mr Balwant Patwal, Director of the Transferee Company has filed an affidavit confirming that neither the Petitioner Companies nor their Counsel has received any objection pursuant to citations published in the newspapers.

15. In view of the approval accorded by the Shareholders and Creditors of the Petitioner Companies; CO.PET. 610 /2013 7 representation/reports filed by the Regional Director, Northern Region and the Official Liquidator, attached with this Court to the proposed Scheme of Amalgamation, there appears to be no impediment to the grant of sanction to the Scheme of Amalgamation. Consequently, sanction is hereby granted to the Scheme of Amalgamation under sections 391 and 394 of the Companies Act, 1956. The Petitioner Companies will comply with the statutory requirements in accordance with law.