Per: R.SUCHARITHA, MEMBER (JUDICIAL)
1. This is an application filed by the Applicant Companies, namely M/s. Mothi Spinners Private Limited (for brevity “Demerged Company”) and M/S. Chendhoor Murugahan Yarn Tex India Private Limited (for brevity “Resulting Company”) with its Shareholders under section 230-232 of Companies Act, 2013, and other applicable provisions of the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 in relation to the Scheme of Arrangement (hereinafter referred to as the “SCHEME”). The said Scheme is also annexed as Annexure “A1” to the CA/CAA/40 (CHE) 2021.
2. The Applicant Companies in this Company Application have sought for the following reliefs:
(a) Dispensing the meeting of the equity shareholders of the Demerged and Resulting company;
(b) Dispensing the meeting of the Secured Creditors of Demerged and Resulting Company;
(c) Necessary directions to conduct the meeting of the Unsecured Creditors of Demerged and Resulting Company;
3. An affidavit in support of the above application is sworn for and behalf of the Applicant Companies has been filed by Mr. V.S. Chandrasekaran in the capacity of Managing director for the Demerged Company and Mr. K. Subramani in the capacity of Managing Director for the Resulting company along with the application and it is also represented that the Registered office of the Applicant Companies are situated at No.13B, Bridge Road, Pallipalayam Post, Namakkal District - 638006 within the territorial jurisdiction of the Bench of this Tribunal and falling within the purview of Registrar of Companies, Coimbatore.
4. MOTHI SPINNERS PRIVATE LIMITED (DEMERGED COMPANY)
(i) There are 52 (Fifty Two) Equity Shareholders and list of shareholders to this effect is placed at page 101 to 108 and consent affidavits given by all the Equity Shareholders are placed as pages 109 to 264 of the typed set filed with the application and sought for dispensation with holding of the meeting.
(ii) There are 6 Secured Creditors and the certificate issued by the Chartered Accountant to this effect is placed at page 265 and consent affidavits given by 5 Secured Creditors being 98.9% of the total value of credit is placed as pages 266 to 275 of the typed set filed with the application and sought for dispensation with holding of the meeting.
(iii) There are 180 (One Hundred and Eighty) Unsecured Creditors and the certificate issued by the Chartered Accountants to this effect is placed at page 276 to 280 of the typed set filed along with the Application seeks necessary directions to conduct the meeting.
5. CHENDHOOR MURUGAHAN YARN TEX INDIA PRIVATE LIMITED (RESULTING COMPANY)
(i) There are 4 (Four) Equity Shareholders and the list of shareholders to this effect is placed at page 104 and consent affidavits given by all the Equity Shareholders are placed at pages 105 to 116 of the typed set filed with the application and sought for dispensation with holding of the meeting.
(ii) There is 1 (One) Secured Creditor and the certificate issued by the Chartered Accountant to this effect is placed at page 117 of the typed set filed along with the Application and consent affidavits given by the sole Secured Creditor is placed as page 118 to 119 of the typed set filed with the application and sought for dispensation with holding of the meeting.
(iii) There are 131 (One Hundred and Thirty One) Unsecured Creditors and the certificate issued by the Chartered Accountants to this effect is placed at page 120 to 123 of the typed set filed along with the Application seeks necessary directions to conduct the meeting.
6. We have perused the application and the connected documents / papers filed therewith including the Scheme contemplated by the Applicant companies.
7. From the certificate of incorporation filed, it is evident that the Demerged Company is a Private limited company incorporated under the provisions of Companies Act, 1956 on 19.01.2000. The Authorized Share Capital of the Applicant Company is =33,50,00,000 (Rupees Thirty Three Crore Fifty Lakh Only) consisting of 33,50,000 Equity Shares of Rs.100/- each. The Issued, Subscribed and Paid-up Capital of the Demerged Company is %21,90,05,400 (Rupees Twenty One Crore Ninety Lakh Five Thousand Four Hundred Only) consisting of 21,90,054 Equity Shares of Rs.100/- each.
8. From the certificate of incorporation filed, it is evident that the Resulting Company is a Private limited company incorporated under the provisions of Companies Act, 2013 on 17.04.2018. The Authorized Share Capital of the Transferee Company is 710,00,000 (Rupees Ten Lakh Only) consisting of 10,000 Equity Shares of Rs.100/- each. The Issued, Subscribed and Paid-up Capital of the Resulting Company is %1,00,000 (Rupees One Lakh Only) consisting of 1000 Equity Shares of Rs.100/- each.
9. The Applicant Companies have filed their respective Memorandum and Articles of Association, inter alia delineating its object clauses as well as their last available Audited Annual Accounts for the year ended 31.03.2020 and Unaudited Financial Statements as on 31.12.2020.
10. The Board of Directors of the Applicant Companies vide meeting held on 29" October 2020 have unanimously approved the proposed Scheme as contemplated above and copies of resolutions passed thereon have been placed on record by the applicant companies.
11. The Appointed date as specified in the Scheme Shall be 01.04.2020.
12. The Statutory Auditors of the Transferee Company have examined the Scheme in terms of provisions of Sec. 232 of Companies Act, 2013 and the rules made thereunder and certified that the Accounting Treatment is in conformity with the Accounting Standards read with Section 133 of the Companies Act, 2013. The Certificate of the Statutory Auditors issued in this regard is placed at pages 128 of the typed set filed along with the Application.
13. Taking into consideration the application filed by the Applicant Company and the documents filed therewith as well as the position of law, this Tribunal propose to issue the following directions : -
A. IN RELATION TO THE DEMERGED COMPANY:
(i) With respect to Equity shareholders:
Since it is represented by the Demerged Company that there are 52 Equity Shareholders in the Company whose consents by way of Affidavits have been obtained from all and are placed on record, hence the necessity of convening and holding the meeting is dispensed with.
(ii) With respect to Secured Creditors:
Since it is represented by the Demerged Company that there are 6 Secured Creditors in the Company and the consent given by 5 Secured Creditors being 98.9% of the total value of credit have been obtained and placed on record, the necessity of convening and holding the meeting is dispensed with.
(iii) With respect to Unsecured Creditors:
Meeting of Unsecured Loan Creditors of the Demerged Company is directed to be held on 20.11.2021 at 10:30 AM at the Registered Office address of the Demerged Company or through video conferencing or if not convenient at any other suitable place for which prior approval shall be sought from this Tribunal within a period of 7 days from the date of this order and prior to the issue of notices.
B. IN RELATION TO THE RESULTING COMPANY:
(i) With respect to Equity shareholders: Since it is represented by the Resulting Company that there are 4 Equity Shareholders in the Company whose consents by way of Affidavits have been obtained from all and are placed on record, the necessity of convening and holding a meeting to consider and if thought fit, the approval of the scheme is dispensed with.
(ii) With respect to Secured Creditors: Since it is represented by the Resulting Company that there is 1 Secured Creditors in the Company whose consent by way of Affidavit has been obtained and is placed on record, the necessity of convening and holding a meeting to consider and if thought fit, the approval of the scheme is dispensed with.
(iii) With respect to Unsecured Creditors:
Meeting of Unsecured Creditors of the Resulting Company is directed to be held on 20.11.2021 at 12:30 PM the Registered office address of the Resulting Company or through video conferencing or if not convenient at any other suitable place for which prior approval shall be sought from this Tribunal within a period of 7 days from the date of this order and prior to the issue of notices.
14. The quorum for the meeting of the Unsecured Creditors of the Demerged Company and Resulting Company shall be 20 and 15 respectively.
i) The Chairperson appointed for the above said meetings shall be Mr. C. Thirumurthy, (Mob: 98430 96789) and the alternate chairperson appointed for the above said meeting shall be the Managing Director of the Company who has sworn in affidavit on behalf of the respective Applicant Companies. The fee of the Chairperson for the aforesaid meeting shall be %50,000/- (Rupees Fifty Thousand Only) in addition to meeting his incidental expenses.
ii) B. Veena Srihari, PCS (Mob: 98422 35999) is appointed as a Scrutinizer and would be entitled to fee of ¥30,000/- (Rupees Thirty Thousand Only) for services in addition to meeting incidental expenses. The Chairperson(s) will file the reports of the meeting within a week from the date of holding of the above said meetings.
iii) In case the quorum as noted above, for the above meeting of the Applicant Companies is not present at the meeting, then the meeting shall be adjourned by half an hour, and thereafter the person(s) present and voting shall be deemed to constitute the quorum. For the purpose of computing the quorum the valid proxies shall also be considered, if the proxy in the prescribed form, duly signed by the person entitled to attend and vote at the meeting, is filed with the registered office of the applicant companies at least 48 hours before the meeting. The Chairperson and Alternate Chairperson appointed herein along with Scrutinizer shall ensure that the proxy registers are properly maintained. However, every endeavour should be made by the applicant companies to attain at least the quorum fixed, if not more in relation to approval of the scheme.
iv) To meetings shall be conducted either by way of physical means or by video or other audio visual means enabled with e-voting as per applicable procedure prescribed under the MCA Circular MCA General Circular Nos.
(i) 20/2020 dated 5 May, 2020 (AGM Circular),
(ii) 14/2020, dated 08.04.2020 (EGM Circular-I) and
(iii) 17/2020 dated 13.04.2020 (EGM Circular-II);
v) That individual notices of the above said meetings shall be sent by the Applicant Company through registered post or speed post or through courier or e-mail, 30 days in advance before the scheduled date of the meeting, indicating the day, date, the place and the time as aforesaid, together with a copy of Scheme, copy of explanatory statement, required to be sent under the Companies Act, 2013 and the prescribed form of proxy shall also be sent along and in addition to the above any other documents as may be prescribed under the or rules may also be duly sent with the notice.
vi) That the Applicant Company shall publish advertisement with a gap of atleast 30 clear days before the aforesaid meetings, indicating the day, date and the place and time as aforesaid, to be published in the English Daily “Indian Express” (All India Edition), and “Dina Mani” Tamil (Tamil Nadu Edition) in Vernacular stating the copies of Scheme, the Explanatory Statement required to be furnished pursuant to Section 230 of the Companies Act, 2013 and the form of proxy shall be provided free of charge at the registered office of the respective Applicant Companies.
vii) Voting shall be allowed on the proposed Scheme by voting in person. The Chairperson shall as aforestated be responsible to report the result of the meeting within a period of 3 days of the conclusion of the meeting with details of voting on the proposed scheme.
viii) The companies shall individually send notice to concerned Regional Director, MCA, the Income Tax Authorities, Registrar of Companies Chennai, the Reserve Bank of India, Official Liquidator in respect of Transferor Companies, as well as other Sectoral regulators who may have significant bearing on the operation of the applicant companies or the Scheme per se along with copy of required documents and disclosures required under the provisions of Companies Act, 2013 read with Companies (Compromises, Arrangements, Amalgamations) Rules, 2016.
ix) The applicant companies shall further furnish copy of the Scheme free of charge within 1 day of any requisition for the Scheme made by every creditor or member of the applicant companies entitled to attend the meetings as aforesaid.
x) The Authorized Representative of the Applicant Companies shall furnish an affidavit of service of notice of meetings and publication of advertisement and compliance of all directions contained herein at least a week before the proposed meetings.
xi) All the aforesaid directions are to be complied with strictly in accordance with the applicable law including forms and formats contained in the Companies (Compromises, Arrangements, Amalgamations) Rules, 2016 as well as the provisions of the Companies Act, 2013 by the Applicants.
15. The Application stands allowed on the aforesaid terms.
