Minority Shareholders Can Oppress Majority If They Control Company's Management: NCLT Chennai

The National Company Law Tribunal (NCLT) at Chennai has recently observed that the term "oppression" is not determined merely by numerical strength. It held that even a minority shareholder exercising effective managerial control can oppress a majority shareholder by abusing such control.A bench of Judicial Member Sanjiv Jain and Technical Member Venkataraman Subramaniam made the observation while deciding cross-petitions between rival shareholder groups of Silver Line Retreat Hotels Private...

NCLT Ahmedabad Clears First Motion In Orient Cement-Ambuja Cements Merger, Orders Shareholder Meetings

The Ahmedabad bench of the National Company Law Tribunal (NCLT) has directed meetings of the equity shareholders of Orient Cement Ltd. and Ambuja Cements Ltd. to consider their proposed scheme of amalgamation. It dispensed with meetings of the companies' secured and unsecured creditors, as well as their preference shareholders.The order was passed by Judicial Member Shammi Khan and Technical Member Sanjeev Sharma.The application was filed by Orient Cement and Ambuja Cements for the proposed...

NCLT New Delhi Sanctions Amalgamation Of Indo Bevs With 'Brocode' Maker Indospirit Beverages

The New Delhi Bench of the National Company Law Tribunal (NCLT) on 15 July sanctioned the scheme of amalgamation between Indo Bevs Private Limited and Indospirit Beverages Private Limited, the manufacturer of the carbonated wine brand “Brocode”, observing that the Tribunal does not interfere with commercial decisions approved by shareholders and creditors.A Bench comprising Judicial Member Mahendra Khandelwal and Technical Member Anu Jagmohan Singh approved the scheme under Sections 230-232 of...

NCLT Chennai Directs MPS Limited To Convene Meetings For Amalgamation With ADI BPO Services

The Chennai National Company Law Tribunal (NCLT) on 2 July directed MPS Limited to convene meetings of its equity shareholders and unsecured creditors to consider its proposed scheme of amalgamation with wholly-owned subsidiary ADI BPO Services Limited. A Bench of Judicial Member Sanjiv Jain and Technical Member Venkataraman Subramaniam held: “Since the Applicant Company has sought for directions for the meeting of the Unsecured Creditors, this Tribunal orders convening, holding and conducting...

NCLT Delhi Directs Creditor Meetings, Dispenses With Shareholder Meetings In Jakson Limited's Demerger Scheme

The National Company Law Tribunal (NCLT) has dispensed with meetings of the equity shareholders of Jakson Limited and Jakson Infra Projects Limited while directing separate meetings of Jakson Limited's secured and unsecured creditors to consider a proposed scheme for the demerger of the company's businesses into Jakson Infra Projects Limited.A Delhi bench of Judicial Member Jyotsna Sharma and Technical Member Anu Jagmohan Singh passed the order on July 15. Jakson Limited, the demerged company,...

Fresh Cause of Action Cannot Be Introduced Through Amendment To Company Petition: NCLT Kochi

The National Company Law Tribunal at Kochi has held that a fresh and independent cause of action cannot ordinarily be introduced through an amendment to an existing company petition. It observed that permitting such an amendment would defeat the objective of summary proceedings under the Companies Act, 2013 and run contrary to the legislative intent underlying Rule 155 of the National Company Law Tribunal Rules, 2016. A bench of Judicial Member Vinay Goel and Technical Member Ravichandran...

Supreme Court To Hear On Friday Plea Seeking Recall Of Order Referring Jindal Poly Films Dispute To Arbitration

The Supreme Court on Wednesday agreed to hear on Friday a plea filed by a group of 29 minority shareholders seeking recall of its order referring the Jindal Poly Films Ltd. class action dispute to arbitration. The shareholders contend that India's first corporate class action under Section 245 of the Companies Act could not have been referred to arbitration without hearing the other shareholders represented in the proceedings. A bench of Chief Justice Surya Kant, Justice Joymalya Bagchi and...

Auditor Cannot Rely On Undocumented OTS Proposal To Ignore Borrower's Interest Liability: NCLAT

The National Company Law Appellate Tribunal (NCLAT) in Delhi on Monday held that a proposed One-Time Settlement (OTS) with lenders cannot justify an auditor issuing a clean audit report by ignoring accrued interest on borrowings classified as non-performing assets (NPAs). It ruled that an undocumented and unapproved OTS proposal cannot form the basis for derecognising a financial liability. "We are of the firm view that the OTS proposal that was never documented, never sanctioned by the bank's...

Stamp Duty Amendments On Amalgamation Cannot Apply Retrospectively: Kerala High Court

The Kerala High Court on 3 July held that amendments to the Kerala Stamp Act, 1959, introducing stamp duty on amalgamations and reconstructions, cannot be applied retrospectively to transactions completed before the amendments came into force. Justice Harisankar V Menon allowed a petition filed by Zuri Hotels and Resorts Private Limited and quashed the stamp duty demand of Rs. 2.01 crore raised by the registration authorities along with the consequential revenue recovery proceedings. He held: ...

NCLT Mumbai Allows DEXIT Global's ₹203 Crore Preference Share Capital Reduction Under Companies Act

The Mumbai Bench of the National Company Law Tribunal (NCLT) on 9 July approved DEXIT Global Limited's (formerly NSEIT Limited) proposal to reduce its preference share capital under Section 66 of the Companies Act, 2013, holding that the reduction was fair, lawful and not against public interest. A Bench of Judicial Member Ashish Kalia and Technical Member Sanjiv Dutt sanctioned the reduction, allowing the company to cancel preference shares worth up to Rs. 203 crore by returning the...

Karnataka High Court Remands Quikr's ₹1.77 Crore Stamp Duty Dispute Over NCLT-Approved Amalgamation

The Karnataka High Court has set aside an order directing Quikr India Private Limited, which operates the online classifieds platform Quikr, to pay an additional ₹1.77 crore as stamp duty on a National Company Law Tribunal (NCLT)-approved scheme of amalgamation. The matter has been remitted to the District Registrar for fresh consideration. Justice M.G.S. Kamal observed that, for the purpose of levying stamp duty under the Karnataka Stamp Act, 1957, the NCLT's order approving the amalgamation...

Advanced Liquidation Cannot Be Shifted To NCLT Merely Because Assets Are Unsold: Karnataka High Court

The Karnataka High Court on 23 June, held that winding up proceedings cannot be transferred to the National Company Law Tribunal (NCLT) merely because the company's assets have not yet been sold. It noted that once liquidation has progressed substantially in time and substance, transfer would disrupt a mature liquidation process and is not warranted. Justice Suraj Govindaraj dismissed an application filed under the fifth proviso to Section 434(1)(c) of the Companies Act, 2013 (which empowers...