NATIONAL COMPANY LAW TRIBUNAL (CHENNAI BENCH)

C A (C A A) (Company Application (C A A))

19/CHE/2023

HOSUR COIR FOAMS PRIVATE LIMITED - Complainant(s)

Versus

PEPS INDUSTRIES PRIVATE LIMITED - Opp.Party(s)

BEFORE: Sanjiv Jain, Sameer Kakar

B Chandra

31 May 2023

ORDER

Sameer Kakar, Member (Technical)

[1] This is a joint application filed by the Applicant Companies, namely Hosur Coir Foams Private Limited (hereinafter "Transferor Company"), Peps Industries Private Limited (hereinafter Transferee 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 Amalgamation (hereinafter referred to as the "SCHEME") proposed by the Applicant Companies herein with its Shareholders. The said Scheme is placed as Pgs. 312-355 of the Application Typeset.

[2] The Applicant Companies in this Company Application has sought for the following reliefs;

   Equity Shareholders Secured Creditors Unsecured Creditors
Transferor Company To dispense with To dispense with To Order Meeting
Transferee Company To dispense with To dispense with To Order Meeting

[3] From the certificate of incorporation filed, it is evident that

(i) The Transferor Company is a Private company incorporated under the provisions of Companies Act, 1956 on 20.07.1989 with CIN: U01300TZ1989PTC002484. The authorised and paid up share capital of the Transferor Company as on 31.03.2022 is as follows

Particulars Rupees
Authorised share capital

30,000 Equity Shares of Rs.100/- each
30,00,000/-
Issued subscribed and paid up

30,000 Equity shares of Rs.l00/-each
30,00,000/-

The Registered office address of the Transferor Company is situated at No. 16, Sidco Industrial Estate, Phase 3, Hosur-635 126.

(ii) From the certificate of incorporation filed, it is evident that the Transferee Company is an unlisted private company incorporated under the provisions of the Companies Act, 1956 on 13.09.1995 with CIN: U17111TZ1995PTC006507. The authorised and paid up share capital of the Transferee Company as on 31.03.2022 is as follows

Particulars Rupees
Authorised share capital

1,10,00,000 Equity Shares of Rs.10/- each

30,00,000 Preference Shares of Rs.l0/-each
11,00,00,000
Issued subscribed and paid up

30,000 Equity shares of Rs.l00/-each
30,00,000/-

The Registered office address of the Transferee Company is situated at SF No 192,Uthupalayam Road, Arasur Post, Palladam Taluk, Coimbatore-641 407.

[4] Affidavits in support of the above application sworn for and on behalf of the Applicant Companies are listed hereunder:-

(i) Mr. Manjunath Punyamurthy, on behalf of the Transferor Company in the capacity of director/authorized signatory.

(ii) Mr. Keshavan Madhavan, on behalf of Transferee Company on the capacity of the authorized signatory.

Affidavits are placed along with the Application as Pgs 13-18 and it is also represented that the Registered office of the Applicant Companies are situated within the jurisdiction of Registrar of Companies, Coimbatore.

[5] Hosur Coir Foams Private Limited (transferor Company)

(i) There are Seven (7) Equity Shareholders, whose consent affidavits are placed as Pgs.265-303 and the Certificate issued by the Chartered Accountant certifying the list of Equity Shareholders is placed as Pgs.163-165 of the typed set filed with the application. It has sought dispensation with holding of meeting.

(ii) There is NIL Secured Creditor. The certificate issued by the Chartered Accountant to this effect is placed as Pgs.244-246 of the typed set filed with the application. It has sought dispensation with holding of meeting.

(iii) There are 763 (Seven Hundred and Sixty Three) Unsecured Creditors. The certificate of the Chartered Accountant certifying the list of Unsecured Creditors is placed as Pgs 261-263. It has sought for convening, holding and conducting a meeting.

[6] Peps Industries Private Limited (Transferee Company)

(i) There are 6 (Six) Equity Shareholders, whose consent affidavits are placed as Pgs.265-303. The Certificate issued by the Chartered Accountant certifying the list of Equity Shareholders is placed as Pgs 20-22 of the typed set filed with the application. It has sought dispensation with holding of meeting.

(ii) There is 1 (One) Secured Creditor, whose consent affidavit are placed as Pgs.156-169. The certificate issued by the Chartered Accountant to this effect is placed as Pgs 152-154 of the typed set filed along with the Application. It has sought dispensation with holding of meeting.

(iii) There are 223 (Two Hundred and Twenty Three) Unsecured Creditor and the Charted Accountant Certificate certifying the list of Unsecured Creditor is placed as Annexure 21. It has sought for convening, holding and conducting a meeting.

[7]

[8]

[9] We have perused the application and the connected documents / papers filed therewith including the Scheme contemplated by the Applicant companies.

[10] The Applicant Companies have filed Memorandum and Articles of Association inter alia delineating the object clauses as well as their last available Audited Financial Statements for the year ended 31.03.2022.

[11] The Board of Directors of the Applicant Companies vide meeting held on 27.02.2023 have unanimously approved the proposed Scheme as contemplated above and copies of the resolutions passed thereon have been placed on record by the Applicant Companies.

[12] The Appointed date as specified in the Scheme shall be 01.04.2022.

[13] 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 Standards are in compliance with Section 133 of the Companies Act, 2013.

[14] Taking into consideration the application filed by the Applicant Companies and the documents filed therewith as well as the position of law, this Tribunal issues the following directions: -

A. In relation to the Transferor Company:

(i) With respect to the Equity shareholders:

Since it is represented by the Transferor Company that there are 7(Seven) Equity Shareholders in the Company whose consents by way of Affidavits have been obtained and are placed on record, the necessity of convening and holding the meeting is dispensed With.

(ii) With respect to the Secured Creditors:

Since it is represented by the Transferor Company that there is NIL Secured Creditor in the Company, hence the necessity of convening a meeting does not arise.

(iii) With respect to the Unsecured Creditors:

Meeting of the Unsecured Creditors of the Transferor Company is directed to be held on 10.07.2023 at 11.00 AM in the registered office of the Transferee 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 Transferee Company:

(i) With respect to the Equity shareholders:

Since it is represented by the Transferee Company that there are Six (6) 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, holding and conducting the meeting is dispensed with.

(ii) With respect to the Secured Creditors:

Since it is represented by the Transferee Company that there is 1 (One) Secured Creditor in the Company whose consent by the way of Affidavits has been obtained and are placed on record the necessity of convening, holding and conducting the meeting is dispensed with.

(iii) With respect to the Unsecured Creditors:

Meeting of the Unsecured Creditors of the Transferee company is directed to be held on 10.07.2023 at 2.00PM at registered office of the Transferee 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.

[15] The quorum for the meeting of the Transferor Company shall be as follows;

S.NO
Class
Quorum
1.
Unsecured Creditors
100

[16] The quorum for the meeting of the Transferee Company shall be as follows;

S.NO
Class
Quorum
1.
Unsecured Creditors
50

i) The Chairperson appointed for the above said meetings shall be Mr. KS. Ravichandran (Mobile No -.9443026172) and the alternate chairperson appointed for the above said meeting shall be the Director for the Transferor Company and the Managing Director of the Transferee Company who have sworn in affidavit on behalf of the respective Applicant Companies. The fee of the Chairperson for the aforesaid Equity Shareholder meeting of the Transferor Company shall be Rs.50,000/- (consolidated) in addition to meeting their incidental expenses.

ii) Ms. B. Veena (Mobile No: 9842235999) appointed as a Scrutinizer for meeting of the Transferor/Transferee Company and would be entitled to fee of Rs.30,000/- (consolidated) for services in addition to meeting incidental expenses. The Chairperson will file 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. 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) The meetings shall be conducted as per applicable procedure prescribed under the MCA Circular MCA General Circular Nos. (i) 20/2020 dated 5th 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 Act 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 "The New Indian Express" (All India Edition), and "Dinamalar" 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) The Chairperson shall as afore stated 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, Registrar of Companies, Official Liquidator and the Income Tax Authorities, 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.

[17] Accordingly, the Application stands allowed. The Applicant Companies are directed to file the Application for the Second Motion within a period of fourteen (14) days from the date of receipt of this Order.

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