Ecotrust Capital Private Limited v. Chemical and Metallurgical Design Company Limited

1. This is a first motion (joint) application filed by Ecotrust Capital Private Limited (i.e. applicant no.1/transferor company), Chemical and Metallurgical Design Company Limited (i.e. applicant no.2/ transferee/ 2016:DHC:1970 demerged company), Unisystems Packers (i.e. applicant no. 3/resulting company no. 1) alongwith Talentgenie Consultants Private Limited (i.e. applicant no. 4/resulting company no. 2) (hereafter collectively referred to as the applicants) under section 391 to 394 of the Companies Act, 1956 (in short the Act) for approval of the Composite Scheme of Arrangement (hereafter referred to as the scheme). A copy of the scheme is enclosed with the application. 1.[1] To be noted, the scheme is configured in a manner whereby, applicant no. 1/ transferor company will merge with applicant no. 2/ transferee company. Furthermore, applicant no. 2/ demerged/ transferee company will stand demerged into applicant no. 3/ resulting company no. 1 and applicant no. 4/ resulting company no. 2. 1.[2] The purpose and the rationale of the scheme, as articulated in the application is as follows: 1.[3] The applicant no.2/ transferee company, it appears, is managing three vertical business: (i) a high end business centre; (ii) an investment business, whereby, investments are made in shares, securities, mutual funds and other financial instruments; and (iii) an industrial division, which is situate on an industrial plot located in the Okhla Industrial Area, on which, it proposes to set up a packaging industry. 1.[4] The scheme envisages the amalgamation of applicant no.1/ transferor company with applicant no.2/ transferee company. It also envisages, thereafter, the demerger of the industrial division, which would, merge with resulting company no.1; while the investment business would get demerged, and thereafter, would stand merged with resulting company no.2. The high end business centre would, however, remain with applicant no.2/ transferee company. In other words, the resulting company no.1 and resulting company no.2 would act as special purpose vehicles which would absorb the industrial business and the investment division respectively. This, in nutshell, are the broad contours of the proposed scheme.

2. The registered office of the applicants is in Delhi and, therefore, within the territorial jurisdiction of this Court.

3. The details with respect to the applicants’ authorized, issued, subscribed and paid-up capital are set out in paragraph 2 of the scheme. 3.[1] Copies of Memorandum and Articles of Association as well as the latest audited annual accounts as on 31.03.2015 of the applicants have been filed by the applicants.

4. The applicants aver that there that there are no proceedings pending against them, under Sections 235 to 251 of the Act.

5. The scheme has been approved by the Board of Directors (BOD) of the applicants. Copies of the BOD resolutions are filed with the application.

6. The position with regard to equity shareholders and unsecured creditors of the applicants and the consent obtained from them (wherever applicable) qua the scheme, is as follows: Company No. of Equity Shareholders Consent given No. of Unsecured Creditors Consent given Transferor Company 2 ALL NIL N.A.

7. Further, it is noted that the applicants do not have any secured creditors, there is, therefore, as is obvious, no requirement of convening the meetings with respect to that class of creditors. 7.[1] A prayer has been made to dispense with the requirement of convening meetings of the shareholders of the applicants and unsecured creditors of the transferee/demerged company. The letters of consent submitted by the shareholders have been seen and examined. They are found in order. Similarly, letters of consent of the unsecured creditors of the transferee/demerged company have been seen and found in order. 7.[2] Accordingly, the prayer made for dispensing with the requirement of convening meetings of the aforementioned class of persons is allowed.

8. The joint application stands allowed in the aforesaid terms.

9. Dasti.

RAJIV SHAKDHER, J MARCH 08, 2016 Transferee/Demerged Company 8 ALL 61 2 (Being 90% in value) Resulting Company No. 1 2 ALL NIL N.A. Resulting Company No. 2 2 ALL NIL N.A.