TaxTMI 
TaxTMI 
2014 (4) TMI 1325
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....the equity share capital, apart from 25% of the convertible preference shares of Viswapriya (India) Limited. A copy of the letter from Viswapriya (India) Limited dated 1.7.2013 confirming that the petitioner is a registered shareholder is annexed as Annexure-D. 2.2. The petitioner company has an authorized capital of Rs. 6 Crores and paid up capital of Rs. 6 Crores and the same is evident from the audited balance sheet of the petitioner company as on 30.6.2012, annexed as Annexure-B. 2.3. The main objects of the petitioner company are to be financial consultants, advisors, and managers, including rendering of merchant banking services to individuals, companies, and corporations; to engage in stock, share broking services on behalf of institutes, pension funds, corporations, Retail clients in India and abroad; to enroll as a Member of one or more Stock Exchange(s) in India or abroad for the purpose of dealing in shares, securities and in kinds of financial instruments; to carry on financing operations and perform financing services, apart from many other allied objects. 2.4. The Memorandum of Association of the petitioner company also authorizes it to make investments and e....
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....imited from Banks have been repaid and presently the Viswapriya (India) Limited has no bank borrowings. 2.9. It is stated that Viswapriya (India) Limited is presently focussed on dealing in Long Term Financing against Revolving Credit granted against Negotiable Instruments and has a a Fund Base of Rs. 164.90 Crores as at 31.3.2012. Of which, Long Term Borrowings of Rs. 119.21 Crores are Secured Borrowings in the form of issuance of Debentures. The Secured Debentures are issued under the terms of the Debenture Trust Deed dated 1.9.2003, as amended from time to time. Matrix Trustee Company Private Limited is the present Trustee in respect of the Debentures issued by Viswapriya (India) Limited. A copy of the Debenture Trust Deed dated 1.9.2003 along with the letter of Viswapriya (India) Limited dated 15.3.2013 confirming that the said Matrix Trustee Company Private Limited is the Trustee thereunder are annexed as Annexures-H and I respectively. 2.10. The Secured Debentures are all covered by the security of the assets backing the loans granted by the Viswapriya (India) Limited. Viswapriya (India) Limited has given long term revolving financing where the principal and interest ar....
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....s are paid fully, including interest for delayed payment, and in a orderly fashion out of the operations of Viswapriya (India) Limited, without impairing the continuance of the operations of the said company. 3. Heard the learned counsel for the petitioner; Mr. R. Sankaranarayanan, the Court Appointed Chairman; Mr. Satish Parasanan, Mr. R. Swaminathan, Mr. Karthick Seshadri, and M/s. Ram & Rajan Associates, learned counsel for Objectors; Mr. M. Vaidyanathan, learned counsel for M/s. Viswapriya (India) Limited; and Mr. N. Ramesh, learned Central Government Standing Counsel appearing for the Regional Director, Ministry of Corporate Affairs. 4. Before proceeding further, it is necessary to refer to the various terms of the Scheme of Arrangement, annexed as Annexure-J, which read as under: "OBJECTS OF THE SCHEME OF ARRANGEMENT The reasons and circumstances leading to and justifying the proposed Scheme of Arrangement and which make it beneficial for the Company, its Secured Debenture Holders, its shareholder and all concerned are as follows:- (a) The company has a networth of over Rs 32 Crores and has had continuous profits in each year of its over 2 dec....
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.... the Company but however the Applicant has already committed to infusion of Rs 15 Crores into the company in 3 equal instalments by 31st March 2014, 30th Sept 2014 and 31st March 2015 (j) The Scheme if approved would enable the Company to repay its Secured Debenture holders in full with contracted interest in the manner contemplated in the scheme and would thus benefit both the Company as well as its Secured Debenture holders. SALIENT FEATURES OF THE SCHEME The following are some of the salient features of the said Scheme of Arrangement: PART - I DEFINITIONS:- 1. "Appointed Date" means 31.01.2013 (ie., the 31st day of January 2013). 2. "Creditors" shall mean and include Secured Debenture holders (as defined under the Scheme) of the Company as on Appointed date. 3. "Effective Date" means the last of the dates on which the sanctions, consents, approvals required for the Scheme are obtained. PART II - THE SCHEME 1. The Scheme shall become effective from the Appointed Date. 2.With effect from the Appointed Date, the dues of the Company to its Creditors shall be re-structured in the following manner and in accordanc....
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.... Deed shall continue to operate for the benefit of the Debenture holders PART III-GENERAL The Scheme is conditional upon and subject to the approvals of the Secured Debenture holders and any other approvals that may be required for the Scheme under laws in force." 5. The petitioner initially filed C.A.No.1007 of 2013, and this Court passed the following order on 25.9.2013: "This is an application taken out by a company, which holds 25% of the equity shares in the company by name M/s. Viswapriya (India) Limited, praying for convening a meeting of the secured debenture holders of M/s. Viswapriya (India) Limited for the purpose of considering and approving, with or without modification, a Scheme of Arrangement to be made between M/s. Viswapriya (India) Limited and its secured debenture holders. 2. Heard Mr. Prakash Goklaney, learned counsel for the applicant and Mr. M. Vaidyanathan, learned counsel for M/s. Viswapriya (India) Limited. 3. The applicant holds 6,85,075 equity shares of Rs. 10/- each in the company known as M/s. Viswapriya (India) Limited. The shareholding of the applicant company is 25%. The applicant proposes to sponsor a Scheme....
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....ountry such as Mumbai, Hyderabad, Bangaluru, Chennai and few other Cities. Though the applicant claims that it had issued debentures only to two persons and that they had transferred the same to more than 1,500 persons, the said claim is to be verified. But the fact remains that a few debenture holders have admittedly lodged criminal complaints either before the Economic Offences Wing of the State Police or the Registrar of Companies. From the Memorandum and Articles of Association of the company Viswapriya (India) Limited and from their Annual Report for 2011- 2012, it is seen that one Mr. R. Subramanian is a Director and a subscriber. I do not know if this R. Subramanian is the very same person who was the promoter of Subhiksha Trading Services Limited, which is facing a host of litigation including the impounding of his passport by this Court, but which has been stayed by the Supreme Court. 8. Therefore, in the light of the above facts, I am of the view that strict standards have to be applied for the convening of the meeting proposed by the sponsor. Hence, this application is allowed, directing a meeting of the secured debenture holders of the company Viswapriya (India....
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....and Ninety One only) representing total value of debentures of Rs. 83,92,91,000/- (Rupees Eighty Three Crores Ninety Two Lakhs and Ninety One Thousand only). (b)The arrangement was taken as read and explained by the nominee of the applicant to the meeting and the question submitted to the said meeting was whether the debenture holders of Viswapriya (India) Limited approved the Scheme of arrangement submitted to the meeting and agreed thereto. (c)The said meeting was of the opinion that the arrangement should be approved and agreed to/for the result of the voting upon the said question was as follows: Voted No. of Debenture Holders & Proxies No. of Debentures Held Total no. of debenture holder and proxies Total debentures held In % Nos. In % Value Debenture Holder Proxies Not Known Debenture Holder Proxies Not Known Against 50 85 - 15,279 56,110 - 135 71,389 6.24% 8.51% For 180 1,835 1 56,716 7,08,595 58 2,016 7,65,369 93.16% 91.19% Not Valid 3 5 5 335 1,366 832 13 2,533 0.60% ....