The court allowed the scheme of arrangement, highlighting the discretion under corporate law to sanction arrangements, given compliance without adverse creditor effects.

ORDER

1. This is a joint First Motion Application (hereinafter referred to as “Application”) filed by the Companies namely; Forech India Private Limited (hereinafter referred to as “Applicant Company No. 1”/ “Demerged Company”), and FIPL Engineering Private Limited, (hereinafter referred to as “Applicant Company No. 2”/ “Resulting Company”) under Sections 230 & 232 of the Companies Act, 2013 (hereinafter referred to as the the “Act”) and other applicable provisions of the Act read with the Companies (Compromises, Arrangements, and Amalgamations) Rules, 2016 (hereinafter referred to as the Rules) and the National Company Law Tribunal Rules, 2016, interalia seeking to:

(i) Dispense with the requirement of convening the meeting of the Equity Shareholders of both the Applicant Company No. 1 and Applicant Company No. 2.

(ii) Direct the convening of the meeting of the Secured Creditors and Unsecured Creditors of the Applicant Company No. 1, and also the requirement of publication of notices for the same;

2. The Scheme of Arrangement between the Applicant Companies and their respective shareholders and creditors (hereinafter referred to as “Scheme”) provides for the Arrangement between Applicant Company No. 1 and Applicant Company No. 2 and their respective Shareholders and Creditors. The said Scheme is attached as Annexure A-4 to the Application.

3. The Registered offices of both the Applicant Companies are situated in the State of Haryana and hence are under the jurisdiction of this Bench.

4. The facts of the case, as stated in the Application, are summarised below:

(i) The Applicant Company No. 1 was incorporated on 21.01.1983 under the Companies Act, 1956, as a public limited company under the name Hilton Marketing Limited, pursuant to a Certificate of Incorporation issued by the Registrar of Companies, NCT of Delhi & Haryana, New Delhi. A Certificate for Commencement of Business was subsequently issued on 23.02.1983. The name of the Company was later changed to Forech India Limited vide a Fresh Certificate of Incorporation dated 18.06.1987. Thereafter, the Company was converted into a private limited company and renamed Forech India Private Limited vide Fresh Certificate of Incorporation dated 19.02.2016, issued by the Registrar of Companies, NCT of Delhi & Haryana, New Delhi.

(ii) The Applicant Company No. 1 is primarily engaged in the manufacturing and marketing of different types of conveyor belts, rubber sheets, and other related products, and other ancillary activities. Manufacturing facilities of the Company are situated in two different geographical locations of India, viz., in the State of Tamil Nadu and in the State of Haryana. Thus, the Applicant Company No.1 has two distinct manufacturing divisions, viz., ‘Tamil Nadu Division’ and ‘Haryana Division’.

(ii) The main objects for which the Applicant Company No. 1 as set out in its Memorandum of Association are as follows:

“1. To manufacture, market, buy, sell, handle, import, export, repair, develop, improve, rubber goods, plastic and plastic goods, fan belts, transmission belts, V-belts, conveyor belts and all kinds of other be/tings, whether for industrial use or otherwise and tyres and tubes of every description for all types of vehicles heavy or light including passenger transport cars, buses, trucks, tractors, aeroplanes, motor cycles, scooters, rickshaws and cycles and also other related articles, flaps, repair materials, appliances, components and accessories relating to tyres and allied industries.

2. To carry on the business as buyers, sellers, importers, exporters, stockists, agents, commission agents, forwarding and clearing agents, distributors, warehousemen,