Nayan Traders Pvt. Ltd. & Ors. v. Udhyam Merchandise Pvt Ltd

1. This second motion joint petition has been filed under Sections I I 391(2) & 394;100 to 104 ofthe Companies Act, 1956 (for short 'Act') I by the Petitioner Companies seeking sanction of the Scheme of i ~ Arrangement (for short 'Scheme') for (a) De-merger of Strategic Investments Business of M/s. Nayan Traders Private Limited (hereinafter referred to as 'Transferor Company No. 1'), M/s. Mili Marketing Private Limited (hereinafter referred to as 'Transferor Company No.2') and M/s. Gargi Traders Private Limited (hereinafter referred to as 'Transferor Company No. 3') into M/s. Udhyam Co. Pet.J63/2011 Page I of[6] 2011:DHC:7664 •' Merchandise Pvt Ltd (hereinafter referred to as 'Transferee Company'); and (b) Reduction/Re-arrangement of post De-merger Share Capital ofthe Transferee Company.

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

3. Details with regard to the date of incorporation of Transferor and Transferee Companies, their authorized, issued, subscribed and paid up capital have been given in the Petition.

4. Copies ofthe Memorandum and Articles of Association as well as the latest audited Annual Accounts for the year ended 31st March, 2010 of the Transferor and Transferee Companies have also been enclosed with the Petition.

5. Copies of the Resolutions passed by the Board of Directors of the Petitioner Companies approving the Scheme have also been placed on record.

6. It has been submitted that no proceeding under Sections 235 to 251 ofthe Act is pending against the Petitioner Companies.

7. The Petitioner Companies had earlier filed CA (M) No. 66 of 2011 seeking directions of this Court for dispensation of requirement Co. Pet.J63/2011 Page 2 of[6] '• of convening the meetings. Vide order dated 28th March, 2011, this Court allowed the Application and dispensed with the requirement of convening meetings of Shareholders and Creditors of the Transferor Companies and the Transferee Company.

8. The Transferor and Transferee Companies have thereafter filed the present Petition seeking sanction of the Scheme. Vide order dated 6th April, 2011, notice in the Petition was directed to be issued to the Regional Director, Northern Region. Citations were also directed to be published in 'Financial Express' (English, Delhi Edition) and 'Jansatta (Hindi, Delhi Edition). Affidavit of Service and Publication has been filed by the Petitioners showing compliance regarding service of the Petition on the Regional Director, Northern Region and also regarding publication of citations in the aforesaid newspapers on 1ih August, 2011. Copies of the newspapers' cuttings, in original, containing the publications have been filed along with the Affidavit of Service.

9. If~: response to the notices issued in the Petition, Mr. B K Bansal, Regional Director, Northern Region, Ministry of Corporate Affairs has filed his Affidavit on 23rd May, 2011. Relying on Para Co. Pet.l63/2011 Page 3 of[6] ·. 5.2.[1] of Part 5 of the Scheme, he has stated that all the employees of the Transferor Companies with respect to the demerged business shall become the employees of the Transferee Company without any break or interruption in their services upon sanctioning ofthe Scheme by the Court.

10. The Regional Director in his Affidavit has submitted that M/s. Rajeev Goel & Associates, Advocates of the Petitioners vide their letter dated ih May, 2011 has intimated that there are no charges proposed to be transferred from the Demerged Companies to the Transferee Company. Learned Counsel for the Petitioner Companies confirmed the same and also drew my attention to Clause 2.1.[4] of the Scheme which provides that, upon the Scheme becoming effective, the Transferee Company shall file such forms as may be required or necessary with the Registrar of Companies with respect to the charges and mortgages created or to be created.

11. In view of the aforesaid clarifications given by the Petitioners, I am satisfied that the issue raised by the Regional Director no longer survives. Co. Pet.J63/2011 Page 4 of[6]

12. No objection has been received to the Scheme from any other party. Mr Narendra Kumar Jain, Director of the Petitioner Transferee Company, has filed an affidavit dated 29th August, 2011, confirming that neither the Petitioner Companies nor their counsel has received any objection pursuant to citations published in the newspapers.

13. In view of the approval accorded by the Shareholders and Creditors of the Petitioner Companies; affidavit filed by the Regional Director, Northern Region to the propos.ed Scheme, there appears to be no impediment to the grant of sanction to the Scheme. Consequently, sanction is hereby granted to the Scheme under Sections 391 and 394 of the Act. The Petitioner Companies will comply with the statutory requirements in accordance with law. Certified copy of the formal order be filed with the Registrar of Companies within 30 days from the date of receipt of the same. In terms of the provisions of Sections 391 and 394 of the Act, all the property, rights and powers of the Transferor Companies No. 1 to 3 pertaining to the demerged business be transferred to and vest in the Transferee Company without any further act or deed. Similarly, all the liabilities and duties of the Transferor Companies No. 1 to 3 Co. Pet.J63/2011 Page 5 of[6] I I, II I' 1 I I I l 11 ll Ill~ II II I 1111111 III 'I 'I I'I I /tV relating to the demerged business be transferred to the Transferee Company without any further act or deed. It is, however, clarified that this order will not be construed as an order granting exemption from payment of stamp duty or any other charges, if payable, in accordance with any law; or permission/compliance with any other requirement which may be specifically required under any law.

14. Mr. Rajeev K. Goel states that Petitioner Companies would voluntarily deposit a sum of~ 50,000/- with the Common Pool fund of the Official Liquidator within three weeks from today. The said statement is accepted.

15. The Petition is allowed in the above terms.