NCLT Ahmedabad Sanctions Vitanosh-Lactose India Merger, Condones Filing Delay

The Ahmedabad National Company Law Tribunal (NCLT) on 5 August sanctioned the Scheme of Amalgamation of Vitanosh Ingredients Pvt. Ltd. with Lactose (India) Ltd., holding that the scheme was prima facie beneficial to the companies and would not prejudice their shareholders or creditors.

A Bench of Judicial Member Shammi Khan and Technical Member Sanjeev Sharma condoned the procedural delay in filing the application and made the scheme effective from the Appointed Date of 1 October 2024, making it binding on the companies, their shareholders and creditors. They held:

“After analysing the Scheme in detail, this Tribunal is of the considered view that the Scheme as contemplated between the Companies seems to be prima facie beneficial to the Companies and will not be in any way detrimental to the interest of the shareholders and the creditors of the Companies, upholding the commercial wisdom doctrine…”

Vitanosh Ingredients, incorporated in 2019, operates a lactose powder manufacturing facility with a capacity of 5,000 metric tonnes per annum. Lactose (India), a listed public company incorporated in 1991, manufactures pharmaceutical-grade lactose monohydrate and lactulose solution, with an annual production capacity exceeding 10,000 metric tonnes.

The companies' boards approved the scheme on 23 October 2024, proposing the merger of Vitanosh Ingredients into Lactose (India). The scheme sought to strengthen manufacturing operations, increase the combined production capacity from 10,000 to 15,000 metric tonnes per annum, and enable expansion into anhydrous and spray-dried lactose.

The companies filed the first motion application before the NCLT. On 12 February 2026, the Bench dispensed with the meetings of the equity shareholders of Vitanosh Ingredients and the creditors of both companies, while directing Lactose (India) to convene a meeting of its equity shareholders. Lactose (India)'s shareholders approved the scheme by the requisite majority at the meeting held on 28 March 2026. The Tribunal had dispensed with the meetings of the other stakeholders.

The Tribunal issued notices to statutory authorities, including the Securities and Exchange Board of India (SEBI), BSE, the Regional Director, the Registrar of Companies (RoC), the Official Liquidator (OL) and the Income Tax Department. The Regional Director and RoC raised queries concerning the Appointed Date, accounting treatment, charges and statutory compliance. The petitioners responded with replies, clarifications and undertakings.

The Official Liquidator confirmed that Vitanosh Ingredients had filed its audited accounts up to 31 March 2025, had not accepted any deposits and was not a non-banking financial company (NBFC). Although the Income Tax Department received notice, it did not file a report.

Petitioners submitted that the accounting treatment prescribed under the scheme complied with the accounting standards prescribed under Section 133 of the Companies Act, 2013, which empowers the Central Government to prescribe accounting standards. They also submitted that no proceedings or investigations were pending against either company. They further explained that procedural requirements, including obtaining BSE's No Objection Letter dated 22 August 2025, caused the delay in filing the application. They submitted that the delay was neither intentional nor deliberate.

The Tribunal noted that Lactose (India)'s shareholders had approved the scheme by the requisite majority and that the statutory authorities had raised no adverse objections. It held:

“Considering the record placed before this Tribunal and since all the requisite statutory compliances have been fulfilled by the Petitioner Companies, this Tribunal sanctions the proposed Scheme as well as the prayer made therein subject to the findings/directions given in this order.”

The Bench also directed the dissolution of Vitanosh Ingredients without winding up. Under the approved share exchange ratio, Lactose (India) must issue 0.7946 equity shares for every one share held in Vitanosh Ingredients.

Accordingly, the NCLT sanctioned the Scheme of Amalgamation and directed the companies to give effect to the scheme in accordance with the terms and directions set out in its order.