Avinya Batteries Limited Vs PPAP Automotive Limited (NCLT New Delhi)
Summary: The NCLT New Delhi considered a joint application filed by Avinya Batteries Limited, the Transferor Company, and PPAP Automotive Limited, the Transferee Company, under Sections 230-232 of the Companies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, concerning a Scheme of Amalgamation of Applicant Company No. 1 into Applicant Company No. 2. Avinya Batteries Limited was incorporated on 01.01.2015 as an unlisted public limited company and is engaged in manufacturing Li-Ion based battery pack solutions for the 2-wheeler and 3-wheeler industry, energy storage systems and industrial power 10 solutions. PPAP Automotive Limited was incorporated as a listed public limited company under the Companies Act, 1956 vide Certificate of Incorporation dated 18.10.1995 and is engaged in manufacturing sealing systems and interior and exterior injection moulded products for automotive industries. The Applicant Companies had approved the proposed Scheme through meetings of their Boards of Directors held on 05.05.2026 and 11.05.2026 respectively. The Applicant Companies submitted that the Scheme was not prejudicial to the interests of their shareholders and creditors and was beneficial to them. The appointed date under the Scheme was 01.04.2026. The Transferor Company had 7 equity shareholders, all of whom, representing 100% voting share, had given consent affidavits. It had 4 secured creditors and 66 unsecured creditors, none of whom had given consent. The Transferee Company had 15,675 equity shareholders, 9 secured creditors and 653 unsecured creditors, with none of these classes having furnished consent affidavits. Accordingly, the Tribunal dispensed with the meeting of the Transferor Company’s 7 equity shareholders but directed meetings of its 4 secured creditors and 66 unsecured creditors. It also directed meetings of the Transferee Company’s 15,675 equity shareholders, 9 secured creditors and 653 unsecured creditors. The Tribunal prescribed notice, publication, website disclosure, regulatory service, voting, quorum, affidavit and reporting requirements under the Companies Act, 2013 and the applicable Companies (Compromises, Arrangements and Amalgamations) Rules, 2016. Mr. Sanjiv Dutt, IRS(R), Ex-Member National Company Law Tribunal, was appointed Chairperson and Adv. Himanshu Kaushik was appointed Scrutinizer. Their fees were fixed at Rs. 1,50,000/- and Rs.50,000/- respectively, besides incidental expenses. The Tribunal directed that voting by an authorised representative of a body corporate would be permitted subject to the specified authorisation requirement, and that the quorum would be as prescribed under Section 103(1) of the Companies Act, 2013. The Chairperson was directed to file an affidavit at least 7 days before the meetings confirming compliance with notice and advertisement directions and to report the meeting results within 7 days of their conclusion. Notices were also directed to be served upon the Regional Director, Ministry of Corporate Affairs, Registrar of Companies, Official Liquidator, Principal Chief Commissioner of Income Tax, jurisdictional Assessing Officer and other sectoral regulators as required. The Petition was ultimately allowed on the aforesaid terms and disposed of.
The Tribunal’s directions concern the procedural stage of the proposed amalgamation under Companies (Compromises, Arrangements and Amalgamations) Rules, 2016. The supplied order records that the Scheme is an amalgamation of Applicant Company No. 1 into Applicant Company No. 2 and that the Applicant Companies had placed their respective Memorandum and Articles of Association and latest Audited Financial Statements for FY ended March 31, 2026 on record.
The Tribunal recorded that the Transferor Company’s 7 equity shareholders had unanimously consented to the Scheme through affidavits and therefore dispensed with their meeting. Since none of the 4 secured creditors or 66 unsecured creditors of the Transferor Company had provided consent, meetings of those creditor classes were directed to be convened.
In respect of the Transferee Company, none of its 15,675 equity shareholders, 9 secured creditors or 653 unsecured creditors had provided consent affidavits. Meetings of all three classes were therefore directed to be convened.
The order requires notices to be issued at least one month before the meetings together with the Scheme and explanatory statement under Section 230(3) of the Companies Act, 2013 read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016. It further requires publication at least 30 days before the meetings in “Business Standard” (English, Delhi Edition) and “Business Standard” (Hindi, Delhi Edition).
The Applicant Companies also undertook to issue notices in Form No. CAA.2, provide the particulars required under Section 230 of the Companies Act, 2013, advertise the meeting notices in Form No. CAA.2 and publish the relevant notices on their websites. The order also requires service of notice upon specified statutory and regulatory authorities.
The Tribunal’s order therefore provides procedural directions for taking the proposed Scheme forward and does not, on the supplied material, constitute a final sanction of the Scheme of Amalgamation itself.
Relevant Legal Framework
The application was filed under Sections 230-232 of the Companies Act, 2013 and the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016. TaxGuru’s reference material on Compromises, Arrangements and Amalgamations under Companies Act, 2013 discusses the statutory framework governing such schemes.
The broader procedural framework for amalgamation under the Companies Act, 2013 is also addressed in General Procedure for Amalgamation under Companies Act 2013.
FULL TEXT OF THE NCLT JUDGMENT/ORDER
1. This is a joint application filed by the Applicant companies herein, Avinya Batteries Limited, (“Transferor Company”) and PPAP Automotive Limited, (“Transferee Company”), jointly referred to as the “Applicant Companies”) under Section 230-232 of Companies Act, 2013, and other applicable provisions of the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016.
2. The Learned Counsel for the Applicant Companies submits that the present Scheme is a Scheme of Amalgamation between “Applicant Company No. 1 into Applicant Company No.2” (For brevity ‘Scheme’) under the provisions of Sections 230 to 232 of the Companies Act, 2013.
3. That Avinya Batteries Limited (hereinafter referred to as the “Transferor Company No. 1 “) incorporated on 01.01.2015 under the provisions of Companies Act, 2013 is an unlisted Public limited Company. The Registered Office of the Transferor Company /Applicant No. 1 is at: 54, Okhla Industrial Estate, Phase III, New Delhi 110020. The main object of the Transferor Company is engagement in manufacturing of Li-Ion based Battery pack solution for the 2-wheeler and 3-wheeler industry, energy storage systems, and industrial power 10 solutions.
4. That PPAP Automotive Limited (hereinafter referred to as the “Transferee Company) incorporated under the provisions of Companies Act, 1956 as a listed Public Limited Company vide Certificate of Incorporation dated 18.10.1995. The Registered Office of the Applicant/Transferee Company Registered office at: 54, Okhla Industrial Estate, Phase III, New Delhi, 110020, India. The main object of the Transferee Company manufacturing of sealing systems, interior and exterior injection moulded products for the automotive industries.
5. The Applicant Company No. 1 and Applicant Company No. 2 have filed their respective Memorandum and Articles of Association inter alia delineating their object clauses, and also filed their latest Audited Financial Statements for the Financial Year “FY” ended March 31, 2026.
6. The Applicant company No. 1 and Applicant Company No.2, vide their meeting of the Board of Directors held on 05.05.2026 and 11.05.2026 have respectively approved the proposed Scheme of Amalgamation. Copies of said resolutions passed in the said board meetings have been placed on record.
7. Applicant Companies submitted that the Scheme is not prejudicial to the interests of the shareholders and creditors of the Petitioner Companies. It is further submitted that the proposed Scheme is beneficial to the Petitioner Companies and their respective Shareholders and Creditors.
8. The Applicant Company submitted that Transferor Company has 7 (seven) equity shareholders and 100% of them have given their consent to the Scheme by way of affidavits. The list of equity shareholders of Transferor Company, along with consent affidavits, is attached with this Application.
9. The Transferor Company has 4 secured Creditors. Certificate from Chartered Accountants certifying list of creditors is annexed. None of the secured creditors gave consent to the scheme of Amalgamation. It is submitted by the Transferor company that since no consent Affidavits have been obtained, the Transferor Company is proposing to convene a meeting of its Secured Creditors.
10. Further, it has been averred that the Transferor Company has 66 (Sixty-six) unsecured creditors. Certificate from Chartered Accountants certifying list of creditors is annexed. None of the unsecured creditors gave consent to the scheme of Amalgamation. It is submitted by the Transferor company that since no consent Affidavits have been obtained, the Transferor Company is proposing to convene a meeting of its Unsecured Creditors.
11. The applicant Companies submitted that the Transferee Company has 15675 equity shareholders. Certificate from Chartered Accountants certifying list of creditors is annexed. None of the Equity Shareholders gave consent to the scheme of Amalgamation. It is submitted by the Transferee company that since no consent Affidavits have been obtained, the Transferee Company is proposing to convene a meeting of its Equity Shareholders.
12. The Transferee Company has 9 secured Creditors. Certificate from Chartered Accountants certifying list of creditors is annexed. None of the secured creditors gave consent to the scheme of Amalgamation. It is submitted by the Transferee company that since no consent Affidavits have been obtained, the Transferee Company is proposing to convene a meeting of its Secured Creditors.
13. Further, it has been averred that the Transferee Company has 653 unsecured creditors. Certificate from Chartered Accountants certifying list of creditors is annexed. None of the unsecured creditors gave consent to the scheme of Amalgamation. It is submitted by the Transferee Company that since no consent Affidavits have been obtained, the Transferee Company is proposing to convene a meeting of its Unsecured Creditors.
14. The appointed date as specified in the Scheme is 01.04.2026.
15. The Applicant Companies have furnished certificates confirming that the provisions relating to the accounting treatment for the proposed Amalgamation, as contained in the Scheme, were in conformity with the applicable provisions of the Companies Act, 2013, Certificates from respective Statutory Auditors of the Companies on the accounting treatment, as proposed in the Scheme, and the same have been annexed to the Petition as A-W and it is clearly stated that the accounting treatment is in conformity with the applicable prescribed under Section 133 of Companies Act, 2013
16. The Applicant Company No. 1 and 2 have stated that no proceedings for inspection, inquiry or investigation were pending against any of the Applicant Companies.
17. Taking into consideration the submissions and the documents filed therewith, the following directions are issued with respect to convening/holding or dispensing with the meetings of the Shareholders, Debenture Holder, Secured and Unsecured Creditors as well as issue of notices including by way of paper publication as follows:
I. In relation to the Transferor Company:
a) With respect to 7 Equity shareholders: In view of consent affidavits from all the Equity Shareholders, having 100% voting share, been filed, convening the meeting of shareholders/members is dispensed with b) With respect to 4 Secured Creditors: Since none of the secured creditors gave consent to the scheme of Amalgamation, therefore, in the interest of justice, a meeting of the Secured Creditors shall be convened at the venue, date, time, and mode as decided by the Chairperson in consultation with the counsel for the Applicant Companies.
c) With respect to 66 Unsecured Creditors: Since none of the Unsecured creditors gave consent to the scheme of Amalgamation, therefore, in the interest of justice, a meeting of the Unsecured Creditors shall be convened at the venue, date, time, and mode as decided by the Chairperson in consultation with the counsel for the Applicant Companies.
II. In relation to the Transferee Company:
d) With respect to 15675 Equity shareholders: Since none of the Equity Shareholders gave consent to the scheme of Amalgamation, therefore, in the interest of justice, a meeting of the Equity Shareholder shall be convened at the venue, date, time, and mode as decided by the Chairperson in consultation with the counsel for the Applicant Companies.
e) With respect to 9 Secured Creditors: Since none of the secured creditors gave consent to the scheme of Amalgamation, therefore, in the interest of justice, a meeting of the Secured Creditors shall be convened at the venue, date, time, and mode as decided by the Chairperson in consultation with the counsel for the Applicant Companies.
f) With respect to 653 Unsecured Creditors: Since none of the Unsecured creditors gave consent to the scheme of Amalgamation, therefore, in the interest of justice, a meeting of the Unsecured Creditors shall be convened at the venue, date, time, and mode as decided by the Chairperson in consultation with the counsel for the Applicant Companies.
18. In respect of the meetings of the Secured and Unsecured Creditors of Applicant Company No. 1 and Secured, Unsecured Creditors and Equity Shareholders of the Applicant Company No. 2, it is hereby directed as under:
a. At least one month before the meetings, notice convening the said meetings at the day, date and time as fixed in accordance with paras stated above, together with a copy of the Scheme, a copy of the Explanatory Statement required to be sent under Section 230(3) of the Companies Act, 2013 read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, shall be sent to the respective Secured and Unsecured Creditors of Applicant Company No.1 and Secured, Unsecured Creditors and equity Shareholder of the Applicant Company No.2, by electronic mail to their registered e-mail address, as per the records available with the respective Applicant Companies. The respective Applicant Companies shall ensure that, the Secured Creditors and Unsecured Creditors and equity shareholders whose e-mail addresses are not available or who have not received notice convening said meetings, can access/download the respective notices of from the website of the Applicant Companies.
b. At least 30 (Thirty) days before the meetings of Secured and Unsecured Creditors of the Applicant Company No.1, and Secured, Unsecured Creditors and Equity Shareholders of the Applicant Company No.2 notice convening the said meetings, at the date and time fixed in accordance with paras stated above be published each in Business Standard” (English, Delhi Edition) and in “Business Standard” (Hindi, Delhi Edition), stating that copies of the Scheme and the said statement required to be furnished pursuant to Section 230(3) of the Companies Act, 2013 can be obtained free of charge from the registered office of the respective Applicant Companies or by emailing the respective Applicant Companies.
19. The Applicant Company No. 1 and Applicant Company No. 2 undertakes to:
i. Issue respective notices convening meetings of its Secured and Unsecured Creditors of Applicant Company No.1 and Secured, Unsecured Creditors and Equity Shareholders of Applicant Company No.2, as per Form No CAA.2 (Rule 6) of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016;
ii. Issue statement containing all the particulars as per Section 230 of the Companies Act, 2013;
iii. Advertise the notice convening meetings as per Form No. CAA.2 (Rule 7) of the Companies (Compromises, Arrangements, and Amalgamations) Rules, 2016; iv. Publish the notice convening the meetings of Secured Creditors, Unsecured Creditors for Applicant Company No.1 and Secured Creditors, Unsecured Creditors and Equity Shareholders for Applicant Company No.2 on its website;
20. That the Adjudicating Authority hereby appoints;
a. Mr. Sanjiv Dutt, IRS(R), Ex- Member National Company Law Tribunal Mobile No. 9969232994, E-mail Id: [email protected], is hereby appointed as the Chairperson for the meeting of the Secured Creditors and Unsecured Creditors of the Applicant Company No.1 and Secured Creditors, Unsecured Creditors and Equity Shareholder of the Applicant Company No. 2.
b. Adv. Himanshu Kaushik(D/1840/2009), Mobile No. 9899498958, E-mail Id: [email protected] is hereby appointed as the Scrutinizer for the meeting of the Secured Creditors and Unsecured Creditors of the Applicant Company No. 1 and Secured Creditors, Unsecured Creditors and Equity Shareholder of the Applicant Company No. 2.
c. The Fees of the Chairperson for the aforesaid meetings shall be Rs. 1,50,000/- and the Fees of the Scrutinizer shall be Rs.50,000/- in addition to meeting their incidental expenses.
21. That the Adjudicating Authority hereby directs;
a. The voting by the authorised representative, in case of a body corporate be permitted, provided that the authorisation duly signed is filed with the Applicant Companies in physical mode at its registered office or electronic mode at the designated email addresses, at least 48 (Forty-Eight) hours before the aforesaid meetings, as required under Rule 10 of the Companies (Compromises, Arrangements and Amalgamation) Rules, 2016.
b. The Chairperson appointed for the aforesaid meetings to issue respective notices of the meetings referred above. The Chairperson shall have all powers under the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, as may be applicable for meeting of the Secured Creditors, Unsecured Creditors and Equity Shareholders of the Applicant Companies, in relation to the conduct of the meetings including for deciding procedural questions that may arise at the meetings or at any adjournment thereof or any other matter including, any amendment to the Scheme or resolution, if any, proposed at the said meetings.
c. The quorum for the meeting of the Secured Creditors, Unsecured Creditors and equity shareholders of the Applicant Company No.1 and Secured, Unsecured Creditors and Equity Shareholders of Applicant Company No.2 shall be as prescribed under Section 103(1) of the Companies Act, 2013.
d. In case the respective quorum as noted above for the meetings is not present at the commencement of the respective meeting, the respective meeting shall be adjourned by 30 minutes and thereafter the persons present and voting at the respective meeting shall be deemed to constitute the quorum.
e. The value and number of the Secured Creditors and Unsecured Creditors of the Applicant Company No.1 and Secured, Unsecured Creditors and Equity Shareholders of Applicant Company No. 2 shall be in accordance with the books/records maintained by the Applicant Companies or depository records, and where the entries in the books/records are disputed, the Chairperson of the meeting shall determine the value and number for the purpose of the aforesaid meeting and his decision in that behalf would be final.
f. The Chairperson shall file an affidavit not less than 7 (Seven) days before the date fixed for holding the meeting of the Secured Creditors, Unsecured Creditors of the Applicant Company No.1 and Secured, Unsecured Creditors and Equity Shareholders of Applicant Company No.2 and report to this Tribunal that the directions regarding the issue of notices and advertisements have been duly complied with, as per Rule 12 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016.
g. The Chairperson shall report to this Tribunal, the result of the aforesaid meetings within 7 (Seven) days of the conclusion of the said meetings and the report shall be verified by his undertaking as per Rule 14 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016.
22. Notice of this Petition shall also be served on the following:
a) Regional Director, Ministry of Corporate Affairs, B-2 Wing, 2 Floor, Paryawaran Bhavan, CGO Complex, New Delhi-110003; b) Registrar of Companies at 4th floor, IFCI Tower, 61, Nehru Place, NewDelhi-110019;
c) Official liquidator, Lok Nayak Bhavan, 8th Floor, Khan Market, New Delhi-110001;
d) Nodal Officer i.e., Principal Chief Commissioner of Income Tax, Delhi, Income Tax Office, Central Revenue Building, IP Estate, New Delhi-110002 and the jurisdictional Assessing officer within whose jurisdiction the Petitioner Company’s assessments are made. The notices to Income Tax Authorities shall disclose sufficient details like PAN, ward numbers and assessing officers so that timely and proper reply may be filed.
e) Any other sectoral regulators required to be served.
23. The present Petition stands allowed on the aforesaid terms and hence, disposed of.
