NCLT Ahmedabad Sanctions First Motion For Inkia Inks–True Colors Amalgamation

The Ahmedabad Bench of the National Company Law Tribunal (NCLT) on 17 August sanctioned the first motion in the proposed amalgamation of Inkia Inks Private Limited with True Colors Limited, allowing the transferor company to dispense with certain meetings while directing meetings of equity shareholders and unsecured creditors of the transferee company.

A Bench comprising Judicial Member Chitra Hankare and Technical Member Dr V.G. Venkata Chalapathy dispensed with the meetings of equity shareholders, secured creditors and unsecured creditors of Inkia Inks Private Limited based on the consents received, while directing True Colors Limited to convene meetings of its equity shareholders and unsecured creditors.

Inkia Inks Private Limited had nine equity shareholders, one secured creditor and 40 unsecured creditors as on 31 March 2026. The company obtained written consents and affidavits from all its equity shareholders and the secured creditor, as well as more than 90% of its unsecured creditors, waiving their right to attend the meetings.

True Colors Limited, a listed public company, had one secured creditor and 329 unsecured creditors as on 31 March 2026. While its secured creditor consented to the scheme, the company sought directions to convene meetings of its equity shareholders and unsecured creditors.

The boards of both companies approved the scheme of amalgamation on 1 December 2025, with 1 April 2026 fixed as the appointed date.

The applicants submitted that the amalgamation would strengthen True Colors' core business through backward integration by consolidating ink manufacturing within its ecosystem. They also submitted that the scheme would ensure assured offtake and optimum utilisation of Inkia Inks' production capacity, with True Colors' customer base expected to absorb more than 50% of the output.

They further submitted that the scheme would enhance market competitiveness, simplify the shareholding structure and consolidate the digital textile printing ecosystem under a single platform.

Further that the scheme was fair and would not prejudice the interests of the shareholders, creditors or the public. The applicants also stated that there were no pending proceedings under Sections 210 to 227 of the Companies Act, 2013, which deal with investigations into the affairs of companies. They further submitted that any legal proceedings involving the transferor company would continue against the transferee company after the appointed date.

The applicants also placed on record certificates from the statutory auditors confirming compliance with Section 133 of the Companies Act, 2013, which deals with accounting standards. Observation letters issued by the BSE on 14 May 2026 were also placed on record in compliance with the Securities and Exchange Board of India's master circular.

The Tribunal noted that the consents obtained from the shareholders and creditors of Inkia Inks justified dispensing with their meetings. However, it directed True Colors to convene meetings of its equity shareholders and unsecured creditors.

The Bench directed that the meetings be convened within 45 days from the date of the order. It appointed R.D. Gupta, Retired Official Liquidator, as Chairman and Mahendra Parmar, former Deputy Registrar of NCLT Ahmedabad, as Scrutinizer for the meetings.

It also directed the companies to issue notices to the statutory authorities, including the Regional Director, Registrar of Companies, Official Liquidator and Income Tax Department, requiring them to file their representations within 30 days.

Accordingly, the NCLT sanctioned the first motion and permitted the scheme of amalgamation to proceed subject to compliance with the directions issued in the order.