Jindal Poly Films Ltd. — M&A Activity 2019

Dec 10, 2019

h'-"'t JINDAL POLY FILMS JD. �!Y

Plot No. 12, Sector B-1, Local Shopping Complex, Vasant Kunj, New Delhi - 110070 (INDIA) Phone: 011-40322100 Fax : (91-11) 40322129 Web. : www.jindalgroup.com

J PFL/DE-PT /SE/2019-20

December 10, 2019

The Manager, Listing National Stock Exchange of India Ltd. Exchange Plaza, Bandra-Kurla Complex Sandra (E) MUMBAI - 400 051

(Scrip Code: NSE: JINDALPOL Y)

The Manager Listing BSE Limited. Phiroze Jeejeebhoy Towers, Dalal Street, Fort, MUMBAI - 400 001

(Scrip Code: BSE: 500227)

Subject: The Scheme of Arrangement of Jindal Poly Films Limited and Jindal Photo Imaging Limited and their respective Shareholders and Creditors.

We wish to inform you that Hon'ble National Company Law Tribunal, Bench at Allahabad in its hearing held on 9th December, 2019 has sanctioned the Scheme of Arrangement of Jindal Poly Films Limited and Jindal Photo Imaging Limited and their respective Shareholders and Creditors.

Copy of Formal Order is awaited and will be submitted you as soon as the same is received by the Company.

However, we have enclosed herewith the Copy of Order as available on website of National Company Law Tribunal.

Please take on record the above for intimation to all concerned.

Thanking you,

For Jindal Poly Films Limited

�vv/ Sanjeev Kumar Company Secretary ACS: 18087. E�c 1 fu

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Regd. Office : 19th K.M. Hapur Bulandshahr Road, P.O. Gulaothi, Distt. Bulandshahr (U.P.) CIN : L 17111UP197 4PLC003979

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BEFORE THE NATIONAL COMPANY LAW TRIBUNAL

BENCH AT ALLAHABAD

IN

COMPANY PETITION NO. 274/ ALD/2019 CONNECTED WITH

COMPANY APPLICATION NO. 97/ALD/2019

[Under Sections 230 - 232 and other applicable provisions of the Companies Act, 2013)

In the matter of the Companies Act, 2013

And

In the matter of Sections 230-232 and other applicable provisions of the Companies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016

And

1n the matter of

JINDAL POLY FILMS LIMITED (JPFL)

A Listed Public Company incorporated under the Companies Act, 1956 having its Registered Office at 19 t h K.M. Hapur- Bulandshahr Road, P.O. Gulaothi, Distt. Bulandshahr, Uttar Pradesh-245408having Corporate identification Number Ll71 l 1UP1974PLC003979 .

... Petitioner Transferor Company/ Demerged Company/ Petitioner Company-I

AND

JINDAL PHOTO IMAGING LIMITED (JPIL)

A Publi c Company incorporated under the Companies Act, 1956 having its Registered Office at 19 th K.M. Hapur- Bulandshahr Road, P.O. Gulaothi, Distt. Bulandshahr, Uttar Pradesh-245408having Corporate Identification Number U22222UP2011PLC103611.

Petitioner Transferee Company/ Resulting Company/ Petitioner Company-II

AND their respective Shareholders and Creditors ("Scheme of Arrangement")

ORDER DELIVERED ON:09.12.2019

CORAM: Justice (Retd.) Rajesh Dayal Khare, Hon'ble Member (Judicial)

Counsel for the Petitioners: Shri S.K. Gupta and Shri Ankit Kumar Singh, Practicing Company Secretaries

Per se: Justice (Retd.) Rajesh Dayal Khare, Hon'ble Member (Judicial)

ORDER

1. The Company Petiti on filed by the Petitioner Companies under Sections 230 & 232 of the Companies Act,20 13 read with rules framed there under as in force from time to time for approval to the scheme of arrangement for demerger of

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photo films busin ess ("Demerged Undertaking") belonging to the Pelitionerl'ransferor Company with and into the Petitioner Transferee Company.

1. It is stated that the Schem e of Arrangen1ent ( the Scheme) has been approved by the Board of Directors of the 'Petitioner Transferor Company/ Dem erged Company/ Petitioner Company-I' and the Petitio ner Transferee Company/ Resulting Company/Petitioner Company-II' in their respective Board Meetin gs duly convened and held on 12[th ] November, 2018.

2. The Factual Position of the Authorized, Is sued, Subscribed and Paidup share capital of the Petitioner Transferor Company/ Demergecl Compa ny/Petitioner cribed well in e on is

Company-las on 3 I•• March, 2019 as des this Company P titi as follows:

Particulars		Amount R.I
Authorized Share	Capital:
23,20,00,000equity shares of Rs.10/- each
3,00,00,000 cun1ulative redeemable preference shares of Rs.10/·each
Total		2,62,00,00,000
Issued, Subscribed and Paidup Share Cpital Fully Paid up:
4,37,86,413 equitysharesofRs.10/- each fully paid up		43,78,64,130
Total		43,78,64;130

1. The Factual Position of th e Authorized, I ssued, Subscribed and Paidup share capital of the Petitio ner Transferee Co1npany/ Resulting Company/Petitioner Com e pany-II as on 3 l •• March, 2019 as d scribed well in this Company Petition

is as follows:

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Particulars Amount
(In Rs.)
Authorised Share Capital
20,00,000 Equity Shares of Rs. 10/- 2,00,00,000
each.
Total 2,00,00,000
Issued, Subscribed and Fully Pald•UJ
Share Capital
50,000 Equity Shares of Rs. 10/- each 5,00,000
fully paid-up Capital
Total 5,00,000
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1. The Rati onale of the Scheme is stated as under:

2. (a) The Demerged C-0rnpany has three business segments namely, Packaging Films Business, Photo Films Bu.sine. s and Nonwoveri Fabric Busirress. The Resulting Cotnpany, a wholly owned subsidiary of the Demerged Company, Photo

3. wa.-S aLso incorporated to carry on 'the business which is similar to the Films Business of ·the Demerg,ed Company. In order to m:a.nage both the business segrnents of the Denierged Company efficiently and effedivel'yJ the to

4. man.agernent of the Demerged C..ompany has considered it necessary r h

5. dernege te Photo Films Business of the Dem.ergEd Campany, as ,a going­ c-0noen1, in.to t.he Resulting Company.

6. (b) The Demerger of P,Wto Films Business or the Demerged Undertaking of the the

7. Dernerged Con1.pany into the Resulting Company will enable both cotnpanies to focus on their respective businesses, efficient rnanageme.nt and' control and to exploit business opportunities more efficiently and effectively.

8. (c) The proposed Scheme is in line with the current global industry practice to achieve size,, scalability,. integration, g�ater financial strength and flexibility thereby maximizing shareholder value and to achieue higher long-terms nis.

9. financial retu

10. (d) Pursuant to the demerger of the Prwto Films Business of th.e Demerged Company into the Res-ulting Company, the shareholding of the Demerged Company in the Resulting· Company will be cancelled. The Resulting Company will issue and anot its shares to the shareholders of the Demerged Cornpany in the following: proportion. in which they hold shar·es in the Demeryed Company1 i.e.; mirror image of the shareholding structure will be creat . ed in both the companies subject to con.solida.tion of fractions ,ar i s ng in tenns of clause 13 of the Schem.e. Thus, t.he rights and interests of the shareholders of the Demerged Company are safeguard.

11. It i.s reported that a share exchange ratio report fo.r the proposed demerg•er- of the Demerged Undertaking belongings to the Demcrgcd Company mth and into the R,esu[ting Company along with addendum dated 28lh December, 2018 has it state as under:

be n obtained and

  -

  - _"For euery 4 tfour) equity shares of face val'u.e of_ Rs, _10/ each held in the ·_

  - _De.merged Company,_ as on _the Record Date, every equity shareholder of­ the Dem.erged Company shall without any application, act or deed, be entitled to receive 1 (one) equity share of/ace value of_ Rs. _10/_ - _each of the Resulting Company, er-edited as fully paid-up. The allotment of equity shares of the Resultittg Company shall be in the s,a,ne ratio as aforesaid to all the shareholder-s of the De,nerged Company,. subject_ to _fractional entitlements which shall be dealt with. as per the procedure prouided for in the Scheme. Aocordingly, the Resulting Company shall issue a.nd aUot to ·_

  - _the shareholders of the Demerged Com.pany 10946604 fully paid up equ ity_ sh.ares _of Rs 1' 0/ � each on the Scheme becorning effective.,.,_

-- - .Sol

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1. A pe rusal of the present petition discloses that initially the Petitioner Companies filed a Company Application No. 97 / ALO /2019being the fi rst motion application seeking the directions for convening the meetings of equity shareholders, secured creditors, unsecured creditors of the Petitione r Company-!. The said first motion application also prayed directions for dispensing the meeting of equity shareholders, secured creditors and unsecured creditors of the Petitioner Company-II. This Tribunal vide its order dated April 30, 2019, directed the convening of tlte meetings of equity shareholders, secured creditors and unsecu red creditors of the Petitioner Company-I on June 21, 2019 at Hotel Natraj, Kala Aam Road, Bulanshaltr, Uttar Pradesh-203001, India.

2. notice to tlte (a) Central Government tltrough the Regional Director {Northern Region), Ministry of Corporate Affai rs atNew Delhi; (b) Registrar of Companies,Uttar Pradesh at Kanpur; (c) the In come Tax Authorities; (d) Reserve Bank of India; {e) BSE Limited and to make a paper advertisement in English and Hindi newspapers.

3. 1. Further, this Tribunal issued a direction to tlte Petitioner Companies to iss ue a

•

1. In compliance thereof, notice of the above mentioned meetings were issued by the Petitioner Company-I to its equity shareholders, secured creditors and unsecu1·ed creditors of the Petitioner Company-!. Notices of the meetings were also published in the n ewspapers as directed by this Hon'ble Tribunal. Further, in terms of order dated April 30, 2019, the Petitioner Companies had served the notice of meetings to the statutory authorities, in compliance of section 230 (5) of the Companies Act, 2013. An affidavit of service detailing the service and publi cation of notices was filed by the Chairperson appointed for the meetings on June 14, 2019.

2. 10.Jt is further stated in the Petition that none of tlte Dire ctors of the Petitioner Companies have any material interest in the Scheme, except in tlte capacity of Directors and Shareholders. Further, the Scheme is not intended in any manner to have any beneficial effect on the material inter est, if any, of tlte • Directors of the Petitione r Companies.

3. lt is furthe r stated in the Petition that the assets of the Peti,tioner Companies are sufficient to meet all its liabilities and the Scheme will n ot adversely affect the rights of any of the Creditors of the Petitioner Companies i.n any manner whatsoever. The Sche1ne also does not envisage any compromise ��th the creditors. The Petitioner Companies have made due provisions for pay,nent of a l liabilities as and when th e same will fall due in the usual course.

r

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1. It is also stated that the Auditors of the: P - titioner Compani s hav not disclose-cl any miamanagement of the a airs.

2. 13.That th Petitioner Company-I/ Demerged Company as well asthe Petitioner Company[a] U/Resulting Company have du]y complied \vith the accounting Petitioner

3. standards. Certificates from the respective auditors of the Companies regarding the compliance of .accounting treatment under the Scheme was duly submitted alongwith the Petitionand marked as Annexure- 15_ and 16_, respectively to the Petilion ..

4. In response to such n.otioes issued, the Registrar of Companies has filed its report dated September 27, 2019 declaring that he D tn.erged Company through the present sch me of arrangement intends to de-merge its •Photo Films Business' to the Resu]ting Company, being the wholly owned subsidiary of the Demergcd Company and further, the Demerged Company is a listed c�mpany.

5. 15.Th 'or e Regional Director { then1 Region), Ministry of Corpora e Affairs at New

6. De]hi having received a report from the Registrar of Companies (Kanpur)1 filed his representation Affidavit wherein hestated that 'the Resulting Company shal1 increase its authorized share capital by an am•ount of Rs. 10 crores post sanction of tb Schem,e on payment of the pres.crib d fees.

7. 16.ln response to such notices issued, the Reserve Bank of India has filed its report dated July 30. 2019 states that the companies undergoing compromise/ arrangement/ amalgamation to comply w[i] th the requirements of various laws including lhe rules, regulations and guidelines prescribed by RBI viz, the companies .tnay have to comply with For,eign Exchange Management Act, 1999 and rules and r,egulations made thereunder.

8. The lncoxne Tax Departments have not filed any representation within 30 day_s of servic of the notice of the Petition. Hence. pursuant to section 230(5) •Of the i

Companies Act, 2013 read w Rule 8(3) of Companies (Compromises, Arrangements and Amalg tions) Rules, 2016 1 it is presum,cd that the Income Tax Departments have no objection on the Scheme invdlvjng demerger of Demerged Undertaking of the Petitioner Company-I into th Petitioner .

Company-I] .

• vcrm.ent

• IS.We ha.ve gone through the above stated a s made in the Company We

• p tition and perused the documents annexed ther with. pen1sed affidavits of th Regional Dir ctor as well as Report of Registrar of Companies and

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Reserve Bank of India a_nd there appears to be no reservation to granl sanction to the Scheme for demcrger of Demerged Undertaking of the Petitioner Company-] in to the Petitioner Company-U.

• l

• l9.However, it is clarified that there sha be no limitation on the powers of the income tax authorities for recovery of pending income tax dues. subject to rights and contentions available to the Petitioner Compani · · under the applicable provisions of law, and that any order of this Tribunal is not considered as concluding or putting seal over such proceedings by the income tax authorities t>r court of law.

• Notwithstanding the above, if there is any deficiency found or, violation committed qua any enactment, statutory rule or regulation, the sanction g[r] anted by this 1ribunal to the Scheme wiU not come in the way of action being taken, albeit, in accordance with law, against the concerned persons, di:rectors and officials of the P,etitioners.

• 20.In the resu]t, the Schem, annexed to the Company Petition is duly approved and hereby sanctioned. The P titioner Companies to act upon as per the terms and conditions of the sanctioned Scheme and same to be binding on the shareholdcrs 1 creditors of the Pclilioner Companies and also on the Petitioner Companies with effect from the Appointed Date, i.e , April 1, 2019.

..

1. \Vhilc approving the Scheme as above, we further clarify that this order should not be c,x,nstrued as an order in any way granting c.x, mption from payment of stamp duty1 axes, GST or other charges, if any1 and payment in accordance with Ia,v or in respect to any permission/ compliance ·with any ,other requirement ·which may be specifica y required under any la\v.

22. THIS TRIBUNAL DO FURTHER ORDER-:

That in terms of the scheme of a angement:

• a) That a the property, rights 1 titles and interests of lhe Demerg,ed Undertaking of the Demeq�cd Company be transferred without further esulLin

• a.ct or deed, matter or deed or thing; to the R g Company and ac,cordingly. pursuant to section 232 of Companies Act, 2013, be transferred to and vested in the Resulting Company for all the estates and interests of the Dernerger Company p rtaining ,to, the Demerged Undertaking�

• bl That aU the liabilities and duties of the Demerged Company pertaining to the Demerged Undertaking be transferred \vi thou t further act or deed to the Resulting Company and accordingly the aw:ne sha pursuant to section 232 of the Companies Act. 2013, be transferred tu and become the liabilities and du ties of the Resulting Company;.

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• c) The Resulting Company shall apply for li sting of its equily shares upon receipt of the order of Tribunal as per provisions of applicable rules, regulations and SEBI Circulars;

• That all proceedings now pending by or again st the Demerged Company pertaining to its Demerged Undertaking be continued by or against the Resulting Company;

• d)

• That Petitioner Companies shall within thirty days of the date of the receipt of this order caus e a certified copy of this order to be delivered to the Regis trar of Companies for registration; and

• All concerned regulatory authorities to act on a copy of this order annexed with the scheme duly authenticated by the Assistant Registrar, National Company Law Tribunal, Allahabad Bench.

• That any person interested shall be at liberty to apply to the Tribunal in the above matter for any directions that may be necessary.

• Accordingly, the Petition Company Petition bearing CP NO. 274/ ALD of 2019 is allowed and stands disposed of in the above terms.

, . . ., . ,

Date: 09.12.2019

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..,, I JUSTICE RAJESH DAYAL KHARE MEMBER (JUDICIAL)

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