Pritika Auto Industries Limited — Proxy Solicitation & Information Statement 2022

Aug 5, 2022

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PRITIKA AUTO INDUSTRIES LTD.

Registered Office : Plot No. C-94, Phase –VII, Industrial Focal Point, S.A.S Nagar Mohali, PUNJAB - 160055 Tel. No. : +91 172-5008900 /5008901 CIN : L45208PB1980PLC046738

E-mail : compliance@pritikaautoindustries.com, Website : www.pritikaautoindustries.com

NOTICE - EQUITY SHAREHOLDERS

NOTICE OF MEETING OF THE EQUITY SHAREHOLDERS WHICH INCLUDES PUBLIC SHAREHOLDERS OF PRITIKA AUTO INDUSTRIES LIMITED AS PER THE DIRECTIONS OF THE NATIONAL COMPANY LAW TRIBUNAL, CHANDIGARH BENCH.

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(Convened pursuant to an order dated 29 day of June, 2022 as rectified vide order dated 8 day of July, 2022 passed by the National Company Law Tribunal, Bench at Chandigarh)

MEETING:

Day : Saturday Date : 10th day of September, 2022

Time : 10.30 A.M. (10:30 hours)

Mode : Through Video Conferencing/Other Audio - Visual Means. (“OVAM”) deemed to be held at the Registered Office of the Company at Plot No. C-94, Phase –VII, Industrial Focal Point, S.A.S Nagar Mohali, PUNJAB - 160055.

REMOTE E-VOTING:

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Start Date and Time : Monday, 5 day of September, 2022 at 9.00 a.m. IST (Server Time)

End Date and Time : Friday, 9th day of September, 2022 at 5.00 p.m. IST (Server Time)

INDEX

INDEX
Sr. No.	Contents	Page No.
1	Notice convening the meeting of the equity shareholders of Pritika Auto Industries Limited under the provisions of Sections 230-232 of the Companies Act, 2013 read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016	1
2	Explanatory Statement under Sections 230 (3), 232(1) and (2) and 102 of the Companies Act, 2013 read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016	15
3	Annexure 1 Scheme of Arrangement between Pritika Industries Limited (PIL), the Demerged Company and Pritika Auto Industries Limited (PAIL), the Resulting Company and their respective shareholders and Creditors under Sections 230-232 of the Companies Act, 2013 for demerger and vesting of the “Automotive/Tractor/Engineering Components Business Undertaking” of Pritika Industries Limited as a going concern to Pritika Auto Industries Limited	42
4	Valuation Report dated 14th day of August, 2021 issued by Payal Gada, Proprietor of M/s. Payal Gada & Co. Registered Valuer / Chartered Accountants. Annexure 2	61
5	Fairness Opinion dated 14th day of August, 2021issued by Systematix Corporate Services Limited, the Merchant Banker Annexure 3	84
6	Copy of Observation letter dated 14th day of January, 2022 from BSE Limited to Pritika Auto Industries Limited. Annexure 4	88
7	Annexure 5 Copy of Observation letter dated 14th day of January, 2022 from National Stock Exchange of India Limited (NSE) to Pritika Auto Industries Limited	90

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PRITIKA AUTO INDUSTRIES LTD.

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Sr. No.	Contents	Page No.
8	Complaints Report dated 8th day of November, 2021 submitted by Pritika Auto Industries Limited to BSE Limited Annexure 6	92
9	Complaints Report dated 15th day of November, 2021submitted by Pritika Auto Industries Limited to the National Stock Exchange of India Limited (NSE) Annexure 7	94
10	Summary of the Valuation Report including the basis of valuation Annexure 8	96
11	Annexure 9 Report adopted by the Board of Directors of Pritika Auto Industries Limited in its meeting held on 14th day of August, 2021 pursuant to the provisions of Section 232(2)(c) of the Companies Act, 2013	97
12	Annexure 10 Report adopted by the Board of Directors of Pritika Industries Limited in its meeting held on 14th day of August, 2021 pursuant to the provisions of Section 232(2)(c) of the Companies Act, 2013	101
13	Annexure 11 Extract of Audited Accounting Statement of Pritika Auto Industries Limited for the year ended 31st March, 2022 (*)	105
14	Annexure 12 Extract of Audited Accounting Statement of Pritika Industries Limited for the year ended 31st March, 2022(*)	128
15	Annexure 13 Certifcate from the Statutory Auditors of Pritika Auto Industries Limited the Resulting Company to the efect that the accounting treatment, if any, proposed in the Scheme is in conformity with the Accounting Standards prescribed under Section 133 of the Act.	147
16	Annexure 14 Certifcate from the Statutory Auditors of Pritika Industries Limited the Demerged Company to the efect that the accounting treatment, if any, proposed in the Scheme is in conformity with the Accounting Standards prescribed under Section 133 of the Act.	149
17	The Applicable information of Pritika Industries Limited in the format specifed for Abridged Prospectus as provided in Part E of Schedule VI of Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018 Annexure 15	151

(*) For brevity, the schedules and notes to the financial statements have not been annexed. However, the complete financial statements of Pritika Auto Industries Limited (PAIL) and Pritika Industries Limited (PIL) as at March 31, 2022 are available on the website of the Company at www.pritikaautoindustries.com

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PRITIKA AUTO INDUSTRIES LTD.

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FormNo.CAA2

(Pursuant to Section 230(3) of the Companies Act,2013 and Rules 6 and 7 of the Companies (Compromises, Arrangements and Amalgamations Rules,2016)

BEFORE THE NATIONAL COMPANY LAW TRIBUNAL CHANDIGARH BENCH, AT CHANDIGARH

CA (CAA) NO. 16 CHD /PB / 2022

And Supplementary Item No.2 CA No. 157/2022

In the matter of the Companies Act, 2013

AND

In the matter of application under Sections 230 to 232 read with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016

AND

In the matter of Pritika Industries Limited, a company incorporated under the provisions of the Companies Act, 1956

AND

In the matter of Pritika Auto Industries Limited, a company incorporated under the provisions of the Companies Act, 1956

AND

In the matter of Scheme of Arrangement for demerger and vesting of the Automotive/Tractor/Engineering Components Business Undertaking” of Pritika Industries Limited ('the Demerged Company') into Pritika Auto Industries Limited ('the Resulting Company')

Pritika Auto Industries Limited, a company incorporated under the Companies Act, 1956, having its registered office at Plot No. C-94, Phase-VII, Industrial Focal Point, S.A.S. Nagar, Mohali-160055 Punjab.

... the Resulting Company

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PRITIKA AUTO INDUSTRIES LTD.

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NOTICE CONVENING THE MEETING OF THE EQUITY SHAREHOLDERS (WHICH INCLUDES PUBLIC SHAREHOLDERS) OF THE APPLICANT COMPANY

To,

All the equity shareholders of Pritika Auto Industries Limited (the "Applicant Company"):

NOTICE is hereby given that by an Order dated 29th day of June, 2022 as rectified vide order dated 8th day of July, 2022(the "Orders" ), the Hon'ble National Company Law Tribunal, Chandigarh Bench at Chandigarh ("NCLT") has directed a meeting to be held of the equity shareholders of the Applicant Company through Video Conferencing for the purpose of considering, and if thought fit, approving, with or without modification(s), the arrangement embodied in the Scheme of Arrangement between Pritika Industries Limited (PIL) (Demerged Company) and Pritika Auto Industries Limited (PAIL) ( Resulting Company) and its Shareholders and Creditors for demerger and vesting of the “Automotive/Tractor/Engineering Components Business Undertaking” of Pritika Industries Limited into Pritika Auto Industries Limited pursuant to Sections 230 to 232 read with other relevant provisions if any of the Companies Act, 2013 ("Scheme") .

TAKE FURTHER NOTICE that in pursuance of the said order and as directed therein, further notice is hereby given that a Meeting of the Equity shareholders of the Applicant Company will be held on Saturday, 10th day of September, 2022 at 10.30 a.m.(IST) (“ Meeting ”) through Video Conferencing(“ VC ”)/Other Audio Visual Means (“ OAVM ”) following the operating procedures (with requisite modifications as may be required) referred to in General Circular No. 14/2020 dated April 8, 2020, General Circular No. 17/2020 dated April 13, 2020,General Circular No. 22/2020 dated June 15, 2020, General Circular No. 33/2020 dated September 28, 2020, General Circular No. 39/2020 dated December 31, 2020, General Circular No. 10/2021 dated June 23, 2021, General Circular No. 20/2021 dated December8,2021andGeneralCircularNo.3/2022 dated May 5, 2022 issued by the Ministry of Corporate Affairs, Government of India(collectively referred to as “MCA Circulars” ).

TAKE FURTHER NOTICE that the following resolution is proposed under Sections 230 to 232 of the Act and the rules framed there under (including any statutory modification(s) or re-enactment thereof for the time being in force) and the provisions of the Memorandum of Association and Articles of Association of the Company, for the purpose of considering, and if thought fit, approving the Scheme:

“ RESOLVED THAT pursuant to the provisions of Sections 230 to 232 of the Companies Act,2013, and any other applicable provisions of the Companies Act,2013 (including any statutory modification(s) or re-enactment thereof , for the time being in force),the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 and the rules, circulars and notifications made there under as may be applicable, Sections2(19AA), Section 2(19AAA), Section 2(41A) and other applicable provisions oftheIncome-taxAct,1961, the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations, 2015 (as amended from time to time), SEBI circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and SEBI circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 and Master Circular No. SEBI/HO/CFD/DIL1/CIR/P/2021/0000000665 dated November 23 ,2021 issued by the Securities and Exchange Board of India(“SEBI”) and as amended from time to time, read with the observation letters dated January 14, 2022 issued by BSE Limited and the National Stock Exchange of India Limited and relevant provisions of other applicable laws, the provisions of the Memorandum of Association and Articles of Association of the Company, and subject to the approval of the Hon’ble National Company Law Tribunal ,Chandigarh Bench(“NCLT”)and /or the National Company Law Appellate Tribunal or such other forum or authority as may be vested with the appellate jurisdiction in relation to approval of the Scheme and such other approvals, permissions and sanctions of regulatory and other authorities ,as may be necessary and subject to such conditions and modifications as may be deemed appropriate, at any time and for any reason whatsoever, or which may otherwise be considered necessary, desirable or as may be prescribed or imposed by the NCLT or by any regulatory or other authorities, while granting such approvals ,permissions and sanctions, which may be agreed to by the Board of Directors of the Company (hereinafter referred to as the “Board”, which term shall be deemed to mean and include one or more Committee(s) constituted/ to be constituted by the Board or any person(s) which the Board may nominate to exercise its powers including the powers conferred by this resolution),the proposed Scheme of Arrangement between Pritika Industries Limited (PIL) (Demerged Company) and Pritika Auto Industries Limited (PAIL) (Resulting Company) and its Shareholders and Creditors for demerger and vesting of the “Automotive/Tractor/Engineering Components Business Undertaking” of Pritika Industries Limited into Pritika Auto Industries Limited(" Scheme ') placed before this meeting and initialed by the Chairman of the meeting for the purpose of identification (the “ Scheme ”), as per the draft enclosed to this notice, be and is hereby approved;

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PRITIKA AUTO INDUSTRIES LTD.

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RESOLVED FURTHER THAT for the purpose of giving effect to this resolution and for removal of any difficulties or doubts, the Board, be and is hereby authorized to do all such acts, deeds, matters and things, as it may, in its absolute discretion, deem desirable, necessary, expedient, usual or proper, and to settle any questions or difficulties or doubts that may arise, including passing of such accounting entries and / or making such adjustments in the books of accounts, transfer /vesting of such assets and liabilities as considered necessary to give effect to the above resolution, settling of any questions or difficulties arising under the Scheme or in regard to and of the meaning or interpretation of the Scheme or implementation thereof or in any matter what so ever connected therewith, or to review the position relating to the satisfaction of various conditions of the Scheme and if necessary, to waive any of those, and to make modifications, amendments, revisions, edits and all other actions as may be required to finalise the Scheme and do all acts, deeds and things as may be necessary, desirable or expedient for carrying the Scheme into effect or to carry out such modifications/directions as may be required and/or imposed and/or permitted by the NCLT while sanctioning the Scheme, or by any governmental authorities, to do and perform and to authorize the performance of all such acts and deeds which are necessary or advisable for the implementation of the Scheme and upon the sanction of the Scheme by, amongst others, the NCLT and/or SEBI and/or any other regulatory/Government authorities, to implement and to make the Scheme effective, without any further approval of the Board or to approve withdrawal (and where applicable, re-filing) of the Scheme at any stage for any reason including in case any changes and/or modifications are suggested/required to be made in the Scheme or any condition suggested, required or imposed, whether by any shareholder and /or creditor of the Company, the SEBI, the NCLT, and/or any other authority, are in its view not acceptable to the Company, and/or if the Scheme cannot be implemented otherwise, and to do all such acts, deeds and things as it may deem necessary and desirable in connection there with and incidental thereto, to approve and authorize execution of any agreements, deeds, documents, declarations, affidavits, writings, etc. (including any alterations or modifications in the documents executed or to be executed), whether or not under the Common Seal of the Company, as may be required from time to time in connection with the Scheme.”

TAKE FURTHER NOTICE that a copy of the Scheme, the Explanatory Statement under Sections 230(3), 232(1), 232(2) and 102 of the Act read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules,2016, along with the enclosures as indicated in the Index, are enclosed herewith. In compliance with the Order and the MCA Circulars, the notice of this Meeting, together with the documents accompanying the same, is being sent through electronic mode to those equity shareholders of the Company whose e-mail addresses are registered with the Company/Depository Participant(s) (DPs), and by registered post or Speed Post or courier to the equity shareholders of the Company whose email addresses are not registered with the Company / Depositories. A copy of this Notice and the accompanying documents will be hosted on the website of the Company at www.pritikaautoindustries.com and will also be available on the website of BSE Limited (“BSE”) and National Stock Exchange of India Limited (“NSE”) at www.bseindia.com and www.nseindia.com respectively and also on the website of NSDL at https://eservices.nsdl.com.

A copy of the Scheme along with the Explanatory Statement can be obtained free of charge, between11:00 a.m.to1:00 p.m. on any day (except Saturday, Sunday and public holidays)upto one day prior to the d ate of the Meeting from the Registered Office of the Company or by sending a request, alongwith details of your shareholding in the Company, bye-mail at compliance@pritikaautoindustries.com or at the office of its Advocates, Mr. Yash Pal Gupta, Advocate (P/406/2008) of Bungalow No. 438 AG, Mohali Hills, EMAAR, Sector 109, SAS Nagar, Mohali - (Punjab) 140306.

NCLT has appointed Mr. Chetan Mittal, Senior Advocate and in his absence, Mr. Praveen Gupta, Advocate to be the Chairman of the said meeting including for any adjournment or adjournments thereof.

The Tribunal has also appointed Mr. Subhash Saini, Practicing Company Secretary, as the Scrutinizer for the Meeting, including for any adjournment(s) thereof.

TAKE FURTHER NOTICE that pursuant to the provisions of: (a) Section230(4) read with Sections108 of the Act; (b) Rule 6 (3)(xi) of the Rules; (c) Rules 20 of the Companies (Management and Administration) Rules, 2014 (including any statutory modification or re-enactment thereof); (d) Regulation 44 and other applicable provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI Listing Regulations”); and (e) S E B I c i r c u l a r N o . C F D / D I L 3 / C I R / 2 0 1 7 / 2 1 d a t e d M a r c h 1 0 , 2 0 1 7 a n d S E B I c i r c u l a r n o . SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3 r d November, 2020 read with Master circular no. S E B I / H O / C F D / D I L 1 / C I R / P / 2 0 2 0 / 2 4 9 d a t e d 2 2 n d D e c e m b e r, 2 0 2 0 a n d M a s t e r C i r c u l a r N o . SEBI/HO/CFD/DIL1/CIR/P/2021/0000000665 dated November 23, 2021 issued by the Securities and Exchange Board of India (“SEBI”), as amended from time to time and other relevant laws and regulations, as may be applicable, the Company has engaged the services of National Securities Depository Limited (“NSDL”) for the purpose of providing facility of remote e-voting prior to the Meeting for participation in the Meeting through VC/OAVM Facility and e-voting during the Meeting. Persons entitled to attend and vote may vote through remote e-voting facility made available both prior to as well as during the Meeting through VC/OAVM.

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PRITIKA AUTO INDUSTRIES LTD.

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TAKE FURTHER NOTICE that since the physical attendance of Members is not required and in view of Para A (x) of the MCA Circular No. 14 / 2020 dated 8th April, 2020 voting through proxy shall not be permitted. However, voting through Authorized representatives is permitted. There is no requirement of appointment of proxies. Accordingly, the facility of appointment of proxies by Members under Section 105 of the Companies Act, 2013 (the” Act”) will not be available for the said Meeting and hence, the Proxy Form and Attendance Slip are not annexed to this Notice

TAKE FURTHER NOTICE that the equity shareholders shall have the facility and option of voting on the resolution for approval of the Scheme by casting their votes through (a) remote e-voting prior to the Meeting during the period commencing from 9:00 a.m. IST on Monday, September 5, 2022 and ending at 5:00 p.m. IST on Friday, September 9, 2022 or (b) vote through e-voting system during the meeting through VC/OAVM, as arranged by the Company. The voting rights of equity shareholders shall be in proportion to their share in the paid-up equity share capital of the Company as on the cutoff date determined as per applicable law (“ Cut-off Date ”). A person who is not an equity shareholder as on the Cut-off Date, should treat the Notice for information purpose only. The equity shareholders opting to cast their votes by remote e-voting or e-voting during the Meeting are requested to read the instructions in the Notes of this Notice for further details on remote e- voting and e-voting during the Meeting. You may opt to exercise your votes only in one mode, i.e., by (a) remote e-voting before the meeting or (b) at the time of the meeting. If you cast your votes by remote e-voting, as aforesaid, you will be entitled to attend the Meeting and participate in the discussions in the Meeting but you will not be entitled to vote again by during the Meeting through VC/ OAVM. If you do so, the votes so cast by you during the Meeting through VC/ OAVM shall be treated as invalid.

The Scheme, if approved in the aforesaid meeting, will be subject to the subsequent approval of NCLT.

Sd/Harpreet Singh Nibber Managing Director

Dated this 1st day of August, 2022 Place :- Mohali

Registered office: Plot No. C-94, Phase –VII, Industrial Focal Point, S.A.S Nagar Mohali Punjab– 160055 Tel. No: + +91 172-5008900 /5008901 CIN: L45208PB1980PLC046738 E-mail: compliance@pritikaautoindustries.com Website : www.pritikaautoindustries.com

Notes:

1. Only registered equity shareholders of the Company may attend(either in person or by Authorised Representative) the said Meeting of the Equity Shareholders of the Company, being conducted through VC/OAVM and vote at the Meeting.

2. Pursuant to the order pronounced on 29th day of June, 2022 as rectified vide order dated 8th day of July, 2022 in Company Application No. CA (CAA) NO. 16 CHD /PB / 2022 and Supplementary Item No. 2 CA. 157 /2022 respectively (“ Order ”), passed by the Hon’ble National Company Law Tribunal, Chandigarh Bench(“ NCLT ”),the meeting of the equity shareholders of Pritika Auto Industries Limited (“Tribunal Convened Meeting” or“ Meeting”)is being convened on Saturday the 10th day of September, 2022 at 10:30 a.m. IST through Video Conferencing (“ VC ”) / Other Audio Visual Means (“ OAVM ”) without the physical presence of the equity shareholders at a common venue, at the option of the Company and as per applicable procedure (with requisite modifications as may be required) referred to in General Circular No. 14/2020 dated April 8, 2020, General Circular No.17/2020 dated April 13, 2020, General Circular No.22/2020 dated June 15, 2020, General Circular No.33/2020 dated September 28, 2020, General Circular No.39/2020 dated December 31, 2020, General Circular No.10/2021dated June 23, 2021, General Circular No. 20/2021 dated December 8,2021 and General Circular No.3/2022 dated May 5, 2022 issued by the Ministry of Corporate Affairs, Government of India (collectively referred to as “ MCA Circulars ”),for the purpose of considering, and if thought fit, approving the Scheme of Arrangement between Pritika Industries Limited (PIL) (Demerged Company) and Pritika Auto Industries Limited (PAIL) ( Resulting Company) and its Shareholders and Creditors for demerger and

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PRITIKA AUTO INDUSTRIES LTD.

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vesting of the “Automotive/Tractor/Engineering Components Business Undertaking” of Pritika Industries Limited into Pritika Auto Industries Limited pursuant to Sections 230 to 232 read with other relevant provisions if any of the Companies Act, 2013 (" Scheme "). In accordance with the MCA Circulars, provisions of the Act and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“ Listing Regulations ”), the Meeting is being held through VC/ OAVM. As per Order and MCA Circulars, since the meeting is held through VC/OAVM, the deemed venue of the Meeting shall be registered office of the Company.

3. Explanatory Statement under Sections 230(3), 232(1), 232(2) and 102 of the Act read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 (“ Merger Rules ”), in respect of the business set out in the Notice, is annexed hereto.

4. Equity shareholders attending the Meeting through VC/OAVM will be counted for the purpose of reckoning the quorum and the same shall be 401 in number or 40% in the value of the Equity Shareholders. Further, in terms of the Order, in case the required quorum for the Meeting is not present at the commencement of the Meeting, then the meeting shall be adjourned by 30(thirty) minutes and thereafter, the persons present and voting shall be deemed to constitute the quorum.

5. Pursuant to the Order of the NCLT, the Company has opted to convene the Meeting of equity shareholders by VC/OAVM, and there is no requirement of appointment of proxies as per General Circular No. 14/2020 dated April 8, 2020. Accordingly, the facility of appointment of proxies by equity shareholders under Section 105 of the Act will not be available for the said Meeting. However, in pursuance of Sections112 and 113 of the Act read with Rule10 of the Merger Rules, where a body corporate is a member, authorized representatives of the body corporate may be appointed for the purpose of voting through remote e-voting, for participation in the Meeting through VC/ OAVM facility and e-voting during the Meeting provided an authority letter/ power of attorney/ a copy of the resolution passed by its board of directors or other governing body of such corporate authorizing such person to attend and vote at the Meeting through VC/OAVM as its representative and certified to be a true copy by a director, the manager, the secretary, or other authorized officer of such body corporate along with the attested specimen signature of the duly authorized signatory(ies) who are authorized to vote is emailed to the Scrutinizer at subhsaini1@gmail.com with a copy marked to NSDL at evoting@nsdl.co.in and to the Company at compliance@pritikaautoindustries.com not later than 48 (forty eight) hours before the time scheduled for holding the Meeting. Such corporate members are requested to refer ‘General Guidelines for equity shareholders’ provided herein below, for more information.

6. The Notice, together with the documents accompanying the same, is being sent to all the equity shareholders whose names appear in the register of members/list of beneficial owners as received from NSDL/ CDSL as on 29th day of July, 2022, through electronic mode to those equity shareholders of the Company whose e-mail addresses are registered with the Company/Depository Participant(s) (DPs), and by registered post, Speed Post and Courier to the equity shareholders of the Company whose email addresses are not registered with the Company / Depositories. A copy of this Notice and the accompanying documents will be hosted on the website of the Company at www.pritikaautoindustries.com and will also be available on the website of BSE Limited (“ BSE ”) and National Stock Exchange of India Limited (“ NSE ”) at www.bseindia.com and www.nseindia.com respectively and also on the website of NSDL at https://eservices.nsdl.com.

7. The NCLT has appointed Mr. Subhash Saini (Membership No. F7427and CP No. 6911), Practicing Company Secretary, as the Scrutinizer to scrutinize votes cast electronically through remote e-voting and e-voting during the Meeting in a fair and transparent manner. The Scrutinizer shall submit a consolidated report on votes cast to the Chairperson of the Meeting or to the person so authorized by the Chairperson. The Scrutinizer’s decision on the validity of the votes cast electronically shall be final.

8. In terms of the directions contained in the Order, the Notice convening the Meeting will be published by Company through common advertisement in the ‘Financial Express’ in English language, (Chandigarh Edition) and in the “Deshsewak” in Punjabi Language, (Chandigarh Edition) indicating the day, date, place and time of the Meeting and stating that the copy of the Scheme, the Explanatory Statement required to be furnished pursuant to Sections 230 to 232 of the Act can be obtained free of charge by emailing the Company at compliance@pritikaautoindustries.com .

9. As the Company has opted to convene the Meeting through VC/OAVM, the facility for appointment of proxies by the equity shareholders is not available for the Meeting and hence, the Proxy Form, Attendance Slip and Route Map are not annexed to this Notice.

10. Speaker registration/facility for non-speakers: Any equity shareholder desirous to express his/her views regarding the Scheme during the Meeting, may register himself/herself as ‘Speaker’ by sending request to the said effect from

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PRITIKA AUTO INDUSTRIES LTD.

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his/her registered email address, to the e-mail ID: compliance@pritikaautoindustries.com quoting his/her name, DP ID and Client ID/Folio number, on or before Saturday 3rd September, 2022. The Company reserves the right to restrict the number of questions and/or number of speakers during the Meeting, depending upon availability of time and smooth conduct of the Meeting. Any equity shareholder seeking information in relation to the Scheme is requested to write to the Company at least 7 days before the date of the Meeting by sending e-mail to the e-mail ID: compliance@pritikaautoindustries.com

11. SEBI circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and SEBI circular no. SEBI/HO/CFD/DIL1/ CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 and Master Circular No. SEBI/HO/CFD/DIL1/CIR/P/2021/0000000665 dated November 23, 2021 ("SEBI Circular") issued by the Securities and Exchange Board of India ("SEBI"), inter alia, provides that approval of Public Shareholders of the Applicant Company to the Scheme shall be obtained by way of voting through e-voting. Since, the Applicant Company is seeking the approval of its equity shareholders to the Scheme by way of voting through e-voting, no separate procedure for voting through e-voting would be required to be carried out by the Applicant Company for seeking the approval to the Scheme by its Public Shareholders in terms of SEBI Circular. The aforesaid notice sent to the equity shareholders of the Applicant Company would be deemed to be the notice sent to the Public Shareholders of the Applicant Company. For this purpose, the term "Public" shall have the meaning assigned to it in Rule 2(d) of the Securities Contracts (Regulations) Rules, 1957 and the term "Public Shareholders" shall be construed accordingly. In terms of SEBI Circular, the Applicant Company has provided the facility of voting by e-voting to its Public Shareholders.

NCLT, by its Order, has, inter alia, held that since the Applicant Company is directed to convene a meeting of its equity shareholders and the voting in respect of the equity shareholders is through e-voting, the same is in sufficient compliance of SEBI Circular.

12. In accordance with the provisions of Sections 230 — 232 of the Companies Act, 2013, the Scheme shall be acted upon only if a majority of persons representing three fourth in value of the equity shareholders of the Applicant Company, voting through e-voting, agree to the Scheme.

13. Further, in accordance with the SEBI Circular, the Scheme shall be acted upon only if the votes cast by the Public Shareholders (through remote e-voting or e-voting during the meeting) in favour of the aforesaid resolution for approval of Scheme are more than the number of votes cast by the Public Shareholders against it.

14. Any queries/grievances in relation to the remote e-voting or e-voting during the meeting may be addressed to Mr. C. B. Gupta, Company Secretary of the Applicant Company at Plot No. C-94, Phase –VII, Industrial Focal Point, S.A.S Nagar Mohali Punjab – 160055 or through email to compliance@pritikaautoindustries.com .Mr. C. B. Gupta, Company Secretary of the Applicant Company can also be contacted at +91 172-5008900 /5008901. Any query/grievance related to the e-voting may be addressed to the Registrar and Share Transfer Agents, National Securities Depository Limited ("NSDL") Unit – Pritika Auto Industries Limited- https://eservices.nsdl.com.

1 5. VOTINGTHROUGHELECTRONICMEANS

• (i) As per the directions of the NCLT and in terms of the provisions of Section 108 of the Act, read with Rule 20 of the Companies (Management and Administration) Rules, 2014 as amended and Regulation 44 of the Listing Regulations, MCA Circulars and in terms of SEBI circular no.CFD/DIL3/CIR/2017/21 dated March 10, 2017 and SEBI circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 and Master Circular No. SEBI/HO/CFD/ DIL1/CIR/P/2021/0000000665 dated November 23, 2021, the Company is pleased to provide the facility of “evoting” to its equity shareholders, to enable them to cast their votes on the resolution proposed to be passed during the Meeting, by electronic means. The Company has engaged the services of National Securities Depository Limited (“NSDL”), as the authorized agency to provide e-voting (i.e. remote e-voting and e-voting during the Meeting) facility as well as to enable the equity shareholders (or its authorized representatives, as the case may be) of the Company to attend and participate in the Meeting through VC/OAVM. The facility of casting votes by the equity shareholders using remote e-voting system (e-voting from a place other than venue of the Meeting) as well as e-voting during the Meeting will be provided by NSDL. The equity shareholders opting to cast their votes by remote e-voting or e-voting during the Meeting are requested to read the instructions in the Notes below carefully.

• nd

• (ii) Equity shareholders holding equity shares as on 2 day of September, 2022, being the cut off date will be entitled to exercise their right to vote on the above resolution.

• (iii) The cut-off date to determine the eligibility to attend and vote by remote e-voting or e-voting during the Meeting shall

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be as per applicable law (“Cut-off Date”). Only those equity shareholders who will be present at the Meeting through VC/OAVM facility and have not cast their vote by remote e-voting prior to the Meeting and are otherwise not barred from doing so, shall be eligible to vote through e-voting system during the Meeting.

• (iv) The voting rights of the equity shareholders shall be in proportion to their share in the paid-up share capital of the Company as on the Cut-off Date. Any person who is not an equity shareholder of the Company as on the said date should treat this Notice for information purposes only. In case of joint holders attending the Meeting, only such joint holder whose name appears first in order of names in the Register of Members of the Company in respect of such joint holding will be entitled to vote.

• (v) Each equity shareholder can opt for only one mode of voting i.e.(a) remote e-voting prior to Meeting; or (b) vote through e-voting system during the Meeting through VC/OAVM as arranged by NSDL on behalf of the Company. The equity shareholders of the Applicant Company attending the meeting who have not cast their vote through e- voting shall be entitled to exercise their vote through e-voting system during the meeting. The equity shareholders who have cast their votes by remote e-voting prior to the Meeting will be eligible to participate at the Meeting but shall not be eligible to cast their vote during the Meeting.

• (vi) The procedure for e-voting on the day of the Meeting is identical to remote e-voting instructions as outlined below.

• (vii) Any person who becomes an equity shareholder of the Company after dispatch of the notice of Meeting and holds equity shares as on the Cut-off Date may also follow the procedure as outlined below. Any person who is not an equity shareholder of the Company as on the Cut-off Date should treat this notice for information purpose only.

• (viii) In case of joint holders attending the Meeting, only such joint holder whose name appears first in order of names as of the Cut-off Date in the Register of Members of the Company or in the Register of Beneficial Owners maintained by the Depositories in respect of such joint holding will be entitled to vote.

• (ix) Once the vote on a resolution is cast, the equity shareholder shall not be allowed to change the same subsequently.

16. PROCESS AND MANNER FOR REMOTE E-VOTING AND ACCESS TO MEETING, IS AS UNDER:

Equity shareholders are requested to follow the instructions given below to cast their vote through e-voting and to access the Video Conference facility at the Meeting:

• A. The remote e-voting period begins on Monday, 5th September, 2022, at 9:00 a.m. (IST) (Server time) and ends on Friday, 9th September, 2022 at 5:00 p.m. (IST) (Server time). During this period, equity shareholders holding shares either in physical form or in dematerialized form, as on the ‘Cut-off Date’ i.e. Friday, 2nd September, 2022, may cast their vote electronically by logging to NSDL website at https://www.evoting.nsdl.com/. The e-voting module shall be disabled by NSDL for voting thereafter.

• B. Detailed steps on the process and manner for remote e-voting/e-voting at the Meeting and to access the VC facility at the Meeting, is given below:

• The procedure to vote electronically on NSDL e-voting system consists of “Two Steps” which are outlined below:

Step1: Access to NSDL e-Voting system

• A) Login method for e-Voting and joining virtual meeting for individual equity shareholders holding securities in demat mode

In terms of SEBI circular SEBI/HO/CFD/CMD/CIR/P/2020/242 dated December 9, 2020 on e-Voting facility provided by listed companies, individual equity shareholders holding securities in demat mode are allowed to vote through their demat account maintained with Depositories and Depository Participants. Equity shareholders are advised to update their mobile number and email Id in their demat accounts in order to access e-Voting facility.

Login method for individual equity shareholders holding securities in demat mode is given below:

Type of shareholders	Login Method	Login Method
Individual equity shareholders holding securities in demat mode with NSDL	1.	ExistingIDeASuser can visit the e-Services website of NSDL viz. https://eservices.nsdl.comeither on a personal computer or on a mobile. On the e-Services home page click on the “Benefcial Owner” icon under “Login” which is available under ‘IDeAS’ section, this will prompt you to enter your existing User ID and Password. After successful authentication, you will be able to see e-Voting services under Value added services. Click on “Access to e-Voting” under

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e-Voting services and you will be able to see e-Voting page. Click on company name or e-Voting service provider i.e. NSDL and you will bere-directed to e-Voting website of NSDL for casting your vote during the remote e-Voting period.

1. If you are not registered for IDeAS e-Services, option to register is available at https://eservices.nsdl.com. Select “Register Online for IDeAS Portal” or click at https://eservices.nsdl.com/Secure Web/Ideas Direct Reg.jsp

2. Visit the e-Voting website of NSDL. Open web browser by typing the following URL:https://www.evoting.nsdl.com/either on a personal computer or on a mobile. Once the home page of e-Voting system is launched, click on the icon “Login” which is available under ‘Shareholder/Member’ section. A new screen will open. You will have to enter your User ID (i.e. your sixteen digit demat account number held with NSDL), Password/OTP and a Verification Code as shown on the screen. After successful authentication, you will be redirected to NSDL Depository site wherein you can see e-Voting page. Click on company name or e-Voting service provider i.e. NSDL and you will be redirected to e-Voting website of NSDL for casting your vote during the remote e-Voting period.

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1. Equity shareholders/Members can also download NSDL Mobile App “NSDL Speede” facility by scanning the QR code mentioned below for seamless voting experience.

Individual equity	1. Existing users who have opted for Easi/Easiest, they
shareholders holding	can login through their user id and password. Option will be made available to
securities in demat	reach e-Voting page without any further authentication. The URL for users to login
mode with CDSL	to Easi/Easiest are https://web.cdslindia.com/myeasi/home/login or
	www.cdslindia.com and click on New System My easi.
	2. After successful login of Easi/Easiest the user will be also able to see the e-Voting
	Menu. The Menu will have links of e-Voting service provide r i.e. NSDL. Click on
	NSDL to cast your vote.
	3. If the user is not registered for Easi/Easiest, option to register is available at
	https://web.cdslindia.com/myeasi/Registration/Easi Registration.
	4. Alternatively, the user can directly access e-Voting page by providing Demat
	Account Number and PAN from a link in www.cdslindia.com home page. The
	system will authenticate the user by sending OTP on registered Mobile & Email as
	recorded in the Demat Account. After successful authentication, user will be
	provided links for the respective ESP i.e. NSDL where the e-Voting is in progress.
Individual equity	You can also login using the login credentials of your demat account through your
shareholders	Depository Participant registered with NSDL/CDSL for e-Voting facility. Upon logging
(holding securities in	in, you will be able to see e-Voting option. Click on e-Voting option, you will be
demat mode) log in through their DepositoryParticipant	redirected to NSDL/CDSL Depository site after successful authentication, wherein you can see e-Voting feature. Click on company name or e-Voting service provider i.e. NSDL and you will be redirected to e-Voting website of NSDL for casting your vote
.	during the remote e-Voting period or joining virtual meeting & voting during the
	meeting.

Important Note:

Equity shareholders who are unable to retrieve User ID/ Password are advised to use Forgot User ID and Forgot Password option available at above mentioned website.

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Helpdesk for individual equity shareholders holding securities in demat mode for any technical issues related to login through Depository i.e. NSDL and/or CDSL:

Login type	Help desk details
Individual equity shareholders holding securities in demat mode with NSDL	Equity shareholders facing any technical issue in login can contact NSDL helpdesk by sending a request at evoting@nsdl.co.in or call at toll free no.: 18001020990and1800224430
Individual equity shareholders holding securities in demat mode with CDSL	Equity shareholders facing any technical issue in login can contact CDSL help desk by sending a request at helpdesk.evoting@cdslindia.com or contact at 022-23058738 or 022-23058542-43

• B) Login method for e-Voting and joining virtual meeting for equity shareholders other than individual equity shareholders holding securities in demat mode and equity shareholders holding securities in physical mode.

How to log-into NSDL e-Voting website?

• (a) Visit the e-Voting website of NSDL. Open web browser by typing the following URL: https://www.evoting.nsdl.com/ either on a personal computer or on a mobile.

• (b) Once the home page of e-Voting system is launched, click on the icon “Login” which is available under ‘Shareholder/Member’ section.

• (c) A new screen will open. You will have to enter your User ID, your Password/OTP and a Verification Code as shown on the screen.

• Alternatively, if you are registered for NSDL e-services i.e. IDeAS, you can log-in at https://eservices.nsdl.com/with your existing IDeAS login.

Once you log-into NSDL e-services after using your log-in credentials, click on e-Voting and you can proceed to Step2 i.e. Cast your vote electronically.

• (d) Your User ID details are given below:

Manner of holding shares i.e. Demat (NSDL or CDSL) or Physical	Your User ID is:
(i) For equity shareholders who hold shares in demat account with NSDL	8 Character DPID followed by 8 Digit Client ID For example, if your DPID is IN300 and Client ID is 12 then your user Id is IN30012**.
(ii) For equity shareholders who hold shares in demat account with CDSL	16 Digit Benefciary ID For example, if your Benefciary ID is 12** then your user ID is 12**
(iii) For equity shareholders holding shares in Physical Form	EVEN Number followed by Folio Number registered with the company For example, if folio number is 001and EVEN is 101456 Then user ID is 101456001

• (e) Password details for equity shareholders other than individual equity shareholders are given below:

• (i) If you are already registered fore-Voting, then you can use your existing password to login and cast your vote.

• (ii) If you are using NSDL e-Voting system for the first time, you will need to retrieve the ‘initial password’ which was communicated to you. Once you retrieve your ‘initial password’, you need to enter the ‘initial password’ and the system will force you to change your password.

• (iii) How to retrieve your ‘initial password’?

  1. If your email ID is registered in your demat account or with the Company, your ‘initial password’ is communicated to you on your email ID. Trace the email sent to you from NSDL from your mailbox.

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Open the email and open the attachment i. e.a.pdf file. Open the .pdf file. The password to open the .pdf file is your 8 digits client ID for NSDL account, last 8 digits of client ID for CDSL account or folio number for shares held in physical form. The pdf file contains your ‘User ID ’and your ‘initial password’.

  2. If your email Id is not registered, please follow steps mentioned below which outlines the process for those equity shareholders whose email id is not registered.

• (f) If you are unable to retrieve or have not received the “Initial password “or have forgotten your password:

• (i) Click on “ Forgot User Details/Password ” (If you are holding shares in your demat account with NSDL or CDSL) option available on www.evoting.nsdl.com.

• (ii) “ Physical User Reset Password ” (If you are holding shares in physical mode) option available on www.evoting.nsdl.com.

• (iii) If you are still unable to get the password by aforesaid two options, you can send a request at evoting@nsdl.co.in mentioning your demat account number/folio number, your PAN, your name and your registered address, etc.

• (iv) Equity shareholders can also use the OTP (One Time Password) based login for casting the votes on the e-Voting system of NSDL.

• (g) After entering your password, tick on Agree to “Terms and Conditions” by selecting on the checkbox.

• (h) Now, you will have to click on “Login” button.

• (i) After you click on the “Login” button, home page of e-Voting will open.

Step2: Cast your vote electronically on NSDL e-Voting system

How to cast your vote electronically on NSDL e-Voting system?

• (a) After successful login at Step1, you will be able to see all the companies “EVEN “in which you are holding shares and whose voting cycle is in active status.

• (b) Select “EVEN” of company for which you wish to cast your vote during the remote e-Voting period.

• (c) Now you are ready for e-Voting as the Voting page opens.

• (d) Cast your vote by selecting appropriate options i.e. assent or dissent, verify/modify the number of shares for which you wish to cast your vote and click on “Submit” and also “Confirm” when prompted.

• (e) Upon confirmation, the message “Vote cast successfully” will be displayed.

• (f) You can also take the printout of the votes cast by you by clicking on the print option on the confirmation page.

• (g) Once you confirm your vote on the resolution, you will not be allowed to modify your vote.

GENERAL GUIDELINES FOR EQUITY SHARE HOLDERS

• (a) Equity shareholders are requested to join the Meeting through their Laptop/Desktop with good internet speed or use a Wi-Fi or LAN connection to avoid any disturbance or fluctuation in the network during the Meeting.

• (b) Equity shareholders can attend the Meeting through VC/OAVM after following the steps for Login as out lined above. After successful Login, equity shareholders will be able to see the VC/OAVM link placed under ‘Join meeting’ menu against the Company’s name. Equity shareholders are requested to click on the VC/OAVM link placed under ‘Join meeting’ menu.

• (c) Institutional equity shareholders (i.e. other than individuals, HUF, NRI, etc.) are required to send legible scan copy (PDF/JPG format) of the authority letter/power of attorney by the board of directors or a certified copy of the resolution passed by its board of directors or other governing body of such corporate authorizing their representative(s)to vote at the Meeting through VC/OAVM, to the Scrutinizer by e-mail to subhsaini1@gmail.com or to the Company at compliance@pritikaautoindustries.com. not later than 48 (forty-eight) hours before the time scheduled for holding the Meeting. Institutional equity shareholders (i.e. other than individuals, HUF, NRI etc.) can also upload their board resolution / power of attorney / authority

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letter etc. by clicking on “Upload Board Resolution / Authority Letter” displayed under “e-Voting” tab in their login.

• (d) Any person holding shares in physical form and non-individual equity shareholders, who acquire shares of the Company and become equity shareholder of the Company after this notice is sent through e-mail and holding shares as of the Cut-off Date i.e. Friday 2nd September, 2022, may obtain the login ID and password b y s e n d i n g a r e q u e s t t o N S D L a t e v o t i n g @ n s d l . c o . i n . o r t o t h e C o m p a n y a t compliance@pritikaautoindustries.com. However, if you are already registered with NSDL for remote e- voting, then you can use your existing User ID and Password for casting your vote. If you forgot your password, you can reset your password by using “Forgot User Details/Password” or “Physical User Reset Password” option available on www.evoting.nsdl.com or call on toll free no. 1800 1020 990 and 1800 22 44 30. In case of individual equity shareholders holding securities in demat mode who acquire equity shares of the Company and becomes an equity shareholder of the Company after sending of this notice and holding shares as of the Cut-off Date i.e. Friday 2nd September,2022, may follow the steps as mentioned in the Notes under “Step1: Access to NSDL e-Voting system”.

• (e) It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential. Login to the e-voting website will be disabled after five unsuccessful attempts to key in the correct password. In such an event, you will need to go through the “Forgot User Details/Password” or “Physical User Reset Password” option available on www.evoting.nsdl.com to reset the password.

• (f) In case of any queries, you may refer the Frequently Asked Questions (FAQs) for equity shareholders and e-voting user manual for Equity shareholders available in the download section of www.evoting.nsdl.com or call on toll free no.: 1800 1020 990 and 1800 22 44 30 or send a request to Ms. Pallavi Mhatre at evoting@nsdl.co.in.

• (g) Process for those equity shareholders whose e-mail id is not registered with the depositories to procure user id and password and registration of e-mail id fore-Voting for the resolutions set out in this notice:

• (i) In case shares are held in demat mode, please provide DPID-CLID (16-digit DPID+CLID or 16-digit beneficiary ID), name, client master or copy of Consolidated Account Statement, PAN (self-attested scan copy of PAN card), Aadhar (self-attested scan copy of Aadhar Card) to Company’s RTA at: info@satellitecorporate.com

Post verification of the documents, RTA will forward your request to NSDL and you would receive system generated credentials from NSDL.

If you are an individual equity shareholder holding securities in demat mode, please refer to the login method explained at Step1(A) i.e. Login method for e-Voting for individual equity shareholders holding securities in demat mode.

If you are an on-individual equity shareholder holding securities in demat mode, please refer to the login method explained at Step1(B) i.e. Login method for e-Voting for non-individual equity shareholders holding securities in demat mode.

• (ii) In case shares are held in physical mode, please provided Folio No., name of equity shareholder, scan copy of the share certificate (front and back), PAN (self-attested scan copy of PAN card), Aadhar (selfattested scan copy of Aadhar Card) by email to Company’s RTA at: info@satellitecorporate.com

• Post verification of the documents submitted, RTA will forward your request to NSDL and you would receive system generated credentials from NSDL.

If you are an individual equity shareholder holding securities in physical mode, please refer to the login method explained at Step1 (B) i.e. Login method for e-Voting for individual equity shareholders holding securities in physical mode.

• (iii) In terms of SEBI circular SEBI/HO/CFD/CMD/CIR/P/2020/242 dated December 9, 2020 on e-Voting facility provided by listed companies, individual equity shareholders holding securities in demat mode are allowed to vote through their demat account maintained with Depositories and Depository Participants. Equity shareholders are required to update their mobile number and email ID correctly in their demat account in order to access e-Voting facility.

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17. DECLARATION OF RESULTS ON THE RESOLUTION

• (a) The Scrutinizer shall, after the conclusion of the Meeting, submit a consolidated Scrutinizer’s report of the total votes cast in favour and against the resolution and invalid votes, if any and submit the same to the chairperson of the Meeting or a person authorized by chairperson in writing who shall countersign the same.

• (b) The result of the voting shall be announced by the Chairperson of the Meeting or a person authorized by the Chairperson in writing within 2 (two) working days from the conclusion of the Meeting upon receipt of the Scrutinizer’s report. The results declared, along with the Scrutinizer’s report, shall be displayed at the notice board of registered office of the Company and hosted on the Company’s website at: www.pritikaautoindustries.com and on the website of NSDL at https://evoting.nsdl.com/ immediately after the result is declared. The Company shall also simultaneously forward the results along with the scrutinizer’s report to BSE Limited and National Stock Exchange of India Limited, the stock exchanges where the Company’s equity shares are listed.

18. Subject to the receipt of requisite majority of votes in favour of the Scheme, the resolution shall be deemed to be passed on the date of the Meeting, i.e., on Saturday 10th September, 2022.

Encl: As Above

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BEFORE THE NATIONAL COMPANY LAW TRIBUNAL CHANDIGARH BENCH,

AT CHANDIGARH

CA (CAA) NO. 16 CHD /PB / 2022

And Supplementary Item No.2 CA No. 157/2022

In the matter of the Companies Act, 2013

AND

In the matter of application under Sections 230 to 232 read with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016

AND

In the matter of Pritika Industries Limited, a company incorporated under the provisions of the Companies Act, 1956

AND

In the matter of Pritika Auto Industries Limited, a company incorporated under the provisions of the Companies Act, 1956

AND

In the matter of Scheme of Arrangement for demerger and vesting of the Automotive/Tractor/Engineering Components Business Undertaking” of Pritika Industries Limited ('the Demerged Company') into Pritika Auto Industries Limited ('the Resulting Company')

Pritika Auto Industries Limited, a company incorporated under the Companies Act, 1956, having its registered office at Plot No. C-94, Phase-VII, Industrial Focal Point, S.A.S. Nagar, Mohali-160055 Punjab.

... the Resulting Company

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EXPLANATORY STATEMENT UNDER SECTIONS 230(3), 232(1) AND (2) AND 102 OF THE COMPANIES ACT, 2013 READ WITH RULE 6 OF THE COMPANIES (COMPROMISES, ARRANGEMENTS AND AMALGAMATIONS) RULES, 2016

1. Pursuant to the order dated 29th day of June, 2022, as rectified vide order dated 8th day of July, 2022passed by the Hon'ble National Company Law Tribunal, Bench at Chandigarh (the " NCLT "), Company Scheme Application CA(CAA) No. 16/CHD/PB/2022 and Supplementary Item No. 2 CA NO. 157 /2022 respectively (" Order "), a meeting of the equity shareholders of Pritika Auto Industries Limited (hereinafter referred to as the " Applicant Company " or the " Resulting Company " or " PAIL " as the context may admit) is being convened through Video Conferencing on Saturday, the 10th day of September, 2022 at 10.30 a.m. for the purpose of considering, and if thought fit, approving, with or without modification(s),the arrangement embodied in the Scheme of Arrangement between Pritika Industries Limited (PIL) (Demerged Company) and Pritika Auto Industries Limited (PAIL) ( Resulting Company) and its Shareholders and Creditors for demerger and vesting of the “Automotive/Tractor/Engineering Components Business Undertaking” of Pritika Industries Limited into Pritika Auto Industries Limited pursuant to Sections 230 to 232 read with other relevant provisions if any of the Companies Act, 2013 (" Scheme "). PIL and PAIL are together referred to as the " Companies ". A copy of the Scheme, which has been, inter alia, as approved by the Board of Directors of the Applicant Company at their meeting held on 14th day of August, 2021, is enclosed as Annexure 1 . Capitalized terms used herein but not defined shall have the meaning assigned to them in the Scheme, unless otherwise stated.

2. In terms of the said Order, the quorum for the aforesaid meeting of the Equity Shareholders of the Applicant Company shall be 401 in number or 40% in the value of the Equity Shareholders.

Further in terms of the said Order, NCLT, has appointed Mr. Chetan Mittal, Senior Advocate and in his absence, Mr. Praveen Gupta, Advocate as the Chairman of the meeting of the Applicant Company including for any adjournment or adjournments thereof.

1. This statement is being furnished as required under Sections 230(3), 232(1) and (2) and 102 of the Companies Act, 2013 (the " Act ") read with Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 (the "Rules").

2. As stated earlier, NCLT by its said Order has, inter alia, directed that a meeting of the equity shareholders of the Applicant Company shall be convened and held on Saturday, the 10th day of September, 2022 at 10.30 a.m. for the purpose of considering, and if thought fit, approving, with or without modification(s), the arrangement embodied in the Scheme.

3. In addition, the Applicant Company is seeking the approval of its equity shareholders to the Scheme by way of voting through e-voting. SEBI circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and SEBI circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3 r d November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 and Master Circular No. SEBI/HO/CFD/DIL1/ CIR/P/2021/0000000665 dated November 23, 2021 ("SEBI Circular") issued by the Securities and Exchange Board of India ("SEBI") , inter alia, provides that approval of Shareholders of the Applicant Company to the Scheme shall be obtained by way of voting through e-voting. Since, the Applicant Company is seeking the approval of its equity shareholders to the Scheme by way of voting through e-voting, no separate procedure for voting through e-voting would be required to be carried out by the Applicant Company for seeking the approval to the Scheme by its Shareholders in terms of SEBI Circular.

NCLT, by its Order, has, inter alia, held that since the Applicant Company is directed to convene a meeting of its equity shareholders and the voting in respect of the equity shareholders, is through e-voting, the same is in sufficient compliance of SEBI Circular.

1. In accordance with the provisions of Sections 230 - 232 of the Companies Act, 2013, the Scheme shall be acted upon only if a majority of persons representing three fourth in value of the equity shareholders of the Applicant Company attending the Meeting and exercise their vote during the Meeting or remote e-voting, agree to the Scheme.

2. In terms of the Order dated 29th day of June, 2022, as rectified vide order dated 8th day of July, 2022 passed by the NCLT, Company Scheme Application CA (CAA) No. 16/Chd/Pb/2022, and Supplementary Item No. 2 CA NO. 157/ 2022 if the entries in the books /register of the Applicant Company in relation to the number or value, as the case may be, of the equity shares are disputed, the Chairman of the meeting shall determine the number or value, as the case may be, for the purposes of the said meeting and his decision in that behalf would be final.

Particulars of PRITIKA AUTO INDUSTRIES Limited (PAIL)

1. The Company (PAIL) was initially incorporated on April 11, 1980 under the Companies Act, 1956 (No.1 of 1956) in the

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State of Maharashtra as “Hariganga Machineries and Engineering Services Limited” and received the ‘Certificate of Incorporation’ bearing number 22506 of 1980 from the Registrar of Companies (“ROC”), Maharashtra, Bombay.

The Company had also received Certificate for Commencement of Business from ROC, Maharashtra on 25th April, 1980. The CIN of the Company was L45208MH1980PLC022506.

The name of the Company changed from “Hariganga Machineries and Engineering Services Limited” to i.e. “Shivkrupa Machineries and Engineering Services Limited” on 5th August, 2015 and a fresh certificate of incorporation consequent on change of name was obtained from ROC, Maharashtra, Mumbai.

The Equity Shareholders have passed a special resolution through Postal Ballot on 7th March, 2017 for change of name from “Shivkrupa Machineries and Engineering Services Limited” to its present name i.e. Pritika Auto Industries Limited and a fresh certificate of incorporation dated 16th March, 2017 consequent on change of name was obtained from ROC, Maharashtra, Mumbai.

The Hon’ble Regional Director (WR) Mumbai, vide his order dated 9th June, 2017 has sanctioned a Petition for shifting of the Registered Office of the company from the State of Maharashtra to the State of Punjab. Accordingly, the company, upon registration of the said order, obtained a fresh certificate of incorporation from the Registrar of Companies, Chandigarh.

There has been a change in the name of PAIL in the last five (5) years as mentioned herein above.

The Corproate Identification (CIN) of PAIL is L45208PB1980PLC046738

The Permanent Account Number (PAN) of PAIL is AAACH4698C.

The shares of PAIL are listed on BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE).

1. The Registered office of the PAIL / Resulting Company is presently situated at Plot No. C-94, Phase VII, Industrial Focal Point, S.A.S. Nagar, Mohali – 160 055, Punjab.

There has been a change in the registered office address of PAIL in the last five (5) years as mentioned herein above.

The e-mail address of PAIL is compliance@pritikaautoindustries.com.

1. The objects for which PAIL has been established are set out in its Memorandum of Association.

The main objects of PAIL are as follows:

• To carry on business of Manufacturers, Designers, Planners, Engineers, Consultants, Contractors, Fabricators, Assemblers, Processor, Patentees, Dealers, and Traders, Importers and Exporters of Industrial and Non-Industrial Plants Machineries, equipments, tools stores and spares and to promote develop and provide design plans, layout and technical knowledge, processes, turnkey consultancy, engineering and allied services within and outside India.

• To carry on the business as manufacturers, buyers, sellers, assembling or distributing processors, founders, forgers, converters, fabricators, assemblers, importers, exporters, agents, buyers, and sellers of all types of metal, alloys, castings, automobile parts, machine tools, tractor parts, all types of machinery, plant equipment, component, spares, tools, engineering goods and accessories including zigs and fixtures, bolts and nuts, screws of any size and design for motor vehicles, or components parts thereof, chassis motors, buses lorries, omnibuses, engines, locomotives; scooters, tracks, tractors and other vehicle and component or motor vehicle parts, Tools, implements, spare parts, accessories, materials and allied products of automobiles industry for use as original equipment or otherwise and processing, assembling, jobbing, fabricating, manufacturing and marketing and dealers of automobile accessories and spares, automotive parts connect therewith.

The object clause of PAIL was altered by adding sub clause 1(A) by the shareholders by passing Special Resolution through Postal Ballot held on 6thday of March, 2017 and Certificate of registration of Special Resolution confirming Alteration of Object Clause was issued by the Registrar of Companies, Maharashtra, Mumbai on 9th day of March, 2017.

There has been a change in the object clause of PAIL in the last 5 years as mentioned hereinabove.

1. The brief description of some of the major businesses being carried out by PAIL along with its subsidiaries, joint ventures and associates are as under:

2. a) The Resulting Company (PAIL) is engaged in the business of manufacturing, buying, selling, assembling all types of metals, alloys, castings, automobile parts, tractor parts, and accessories including zigs and fixtures, bolts and

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nuts, or component’s part thereof.

• b) Pritika Engineering Components Ltd. is a wholly owned subsidiary of Pritika Auto Industries Ltd. The company is engaged in the manufacturing of auto and tractor components and parts.

• c) Meeta Castings Limited has been incorporated as wholly owned subsidiary of Pritika Engineering Components Ltd. and is a step-down subsidiary of Pritika Auto Industries Ltd. The company is under process of setting up its unit for manufacturing, castings for automotive, tractor parts and construction /engineering equipments.

• d) The Demerged Company (PIL) is a closely held company. PIL is engaged in various businesses including manufacturing of auto and tractor components and also carrying on the healthcare business including OPD services, diagnostic labs and investment in securities including shares, Mutual funds etc. and trading activity.

• e) Pritika Industries Limited (PIL) the Demerged Company and Pritika Auto Industries Limited (PAIL) the Resulting Company are group companies and under the same management. Both companies are independent of each other except common promoter shareholders and Directors. The Demerged Company (PIL) holds 2,48,74,208 Equity Shares of Rs.2/- each constituting 28.05% of the total issued, subscribed and paid-up capital in the Resulting Company(PAIL).

• The Authorized, Issued, Subscribed and Paid-Up Share Capital of PAIL / the Resulting Company as per the Latest Audited Balance Sheet as at 31st March, 2022 is as under:

Audited Balance Sheet as at 31st March, 2022 is as under:
PARTICULARS	AMOUNT IN RS.
AUTHORISED SHARE CAPITAL
18,25,00,000 EquityShares of Rs. 2/- each	36,50,00,000
TOTAL	36,50,00,000
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL
8,86,72,500 EquityShares of Rs. 2/- each	17,73,45,000
TOTAL	17,73,45,000

Subsequent to 31st March, 2022, there is no change in the Authorised, issued, subscribed and paid-up share capital of PAIL.

Particulars of PRITIKA INDUSTRIES LIMITED (PIL)

st

1. The Demerged Company (PIL) was incorporated on 1 July, 1997 under the Companies Act, 1956 (No.1 of 1956) as “Pritika Industries Private Limited” and received the ‘Certificate of Incorporation’ bearing number 55-88273 of 1997-98 from the Registrar of Companies (“ ROC ”), NCT of Delhi & Haryana.

The name of the Demerged Company was changed from Pritika Industries Private Limited to Pritika Industries Limited and obtained a fresh certificate of incorporation consequent upon change of name on conversion to Public Limited Company dated 12th June, 2012 from the Registrar of Companies, National Capital Territory of Delhi and Haryana.

The Hon’ble Regional Director (NR) New Delhi, vide his order dated 26th November, 2013 has sanctioned a Petition for shifting of the Registered Office of the company from the State of Delhi to the State of Punjab. Accordingly, the company, upon registration of the said order, obtained a fresh certificate of incorporation from the Registrar of Companies, Punjab and Chandigarh.

The Demerged Company (PIL) holds 2,48,74,208 Equity Shares of Rs.2/- each constituting 28.05% of the total issued, subscribed and paid-up capital in the Resulting Company (PAIL) and the said shares shall continue to remain in the remaining business / retained undertaking of the Demerged Company and will not be cancelled.

There has been no change in the name of PIL in the last five (5) years.

The Corporate Identification (CIN) of the Demerged company (PIL) is U85100PB1997PLC038216

The Permanent Account Number (PAN) of the Demerged Company (PIL) is AAACP9500B.

The equity shares of PIL are not listed on any stock exchanges.

1. The Registered Office of PIL is situated at Plot No. C-94, Phase VII, Industrial Focal Point, S.A.S. Nagar, Mohali, Punjab – 160 055.

There has been no change in the registered office address of PIL in last five (5) years.

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The e-mail address of PIL is cs@pritikagroup.com.

1. The objects of the PIL are as set out in its Memorandum and Articles of Association are inter alia as follows: -

2. To acquire and takeover the business of M/s Pritika Industries, a Partnership firm situated at 31-p/1 Gali No. 4-D, Anand Parbat Indl. Area, New Rohtak Road, New Delhi on such terms and condition as may be agreed upon. The said firm shall cease after such takeover.

3. To carry on the business of manufacturing, buying selling, exchange, altering, improving, assembling, or distributing, and dealing in Tractor parts, Machine, Tools, and Machine Tools accessories including zings and fixtures , bolts, and nuts, screws of any size and design for Motor vehicles of components parts thereof, chassis, Motors, buses, lorries, omnibuses, engines, locomotives, scooters, tracks, tractors and other vehicle and component or motor vehicle parts, tools, implements, spare parts, accessories, materials and allied products of automobiles industry for use as original equipment or otherwise.

4. To carry on the business of processing, assembling, jobbing, fabricating, manufacturing and marketing, and dealers of automobile accessories and spares, auto motive parts, connected therewith.

5. To carry on the trade or business of engineers, fitters, founders, smiths, machinists, manufacturers and patentees of production for automobile industry and importers, exporters and distributors of motor parts.

6. To establish, maintain, operate, run, manage or administer, purchase, lease or otherwise acquire/take multispecialty clinics, hospitals, medicare, health care, diagnostic, health aid, research centers and to take their franchises.

7. The object clause of PIL was altered by adding sub clause 5 in Clause 3 (A) by the shareholders by passing Special Resolution in their Extra Ordinary General Meeting held on 4th day of March, 2019 and Certificate of registration of Special Resolution confirming Alteration of Object Clause was issued by the Registrar of Companies, Chandigarh on 7th day of March, 2019.

There has been a change in the object clause of PIL in the last 5 years as mentioned hereinabove.

1. The Demerged Company (PIL) is engaged in various businesses including manufacturing of auto and tractor components and also carrying on the healthcare business including OPD services, diagnostic labs and investment in securities including shares, Mutual funds etc. and trading activity.

2. The Demerged Company holds 2,48,74,208 Equity Shares of Rs.2/- each constituting 28.05% of the total issued, subscribed and paid-up capital in the Resulting Company and the said shares shall continue to remain in the remaining business / retained undertaking of the Demerged Company and will not be cancelled

3. The Authorized, Issued, Subscribed and Paid-Up Share Capital of PIL / the Demerged Company as per the Latest Audited Balance Sheet as at 31st March, 2022 is as under:

Audited Balance Sheet as at 31st March, 2022 is as under:
PARTICULARS	AMOUNT IN RS.
AUTHORISED SHARE CAPITAL:
1,10,00,000 EquityShares of Rs.10/- each	11,00,00,000
TOTAL	11,00,00,000
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL:
98,15,900 EquityShares of Rs.10/- each	9,81,59,000
TOTAL	9,81,59,000

Subsequent to 31st March, 2022, there is no change in the Authorized, issued, subscribed and paid-up share capital of PIL.

Description and Objective of the Scheme

1. The Scheme provides for, inter alia,

2. I. the transfer by way of a Demerger of the Demerged Undertaking i.e. ‘Automotive/Tractor/Engineering Components Business Undertaking’ of the Demerged Company (PIL) to the Resulting Company (PAIL)

3. II. consequent issue of equity shares by the Resulting Company (PAIL) to the shareholders of the Demerged Company (PIL)

4. III. listing of equity shares by PAIL on BSE and NSE

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• IV. Various other matters consequential to or otherwise integrally connected with the above.

  • The proposal is to be implemented in terms of the Scheme under Sections 230 - 232 of the Companies Act, 2013.

• The objective is stated in Clause C of the Scheme (Annexure 1) and is as under:

The Demerged Company is engaged in various businesses and owns the following two business undertakings.

• Automotive/Tractor/Engineering Components Business undertaking

• Healthcare and investment business undertaking.

The Demerged company would demerge Automotive/Tractor/Engineering Components Business undertaking (hereinafter referred to as “Demerged Undertaking”) to the Resulting company and it would continue to run and operate the healthcare and investment business undertaking (hereinafter referred to as the “Remaining Business / Retained Undertaking”). The underlying business rationale and objectives are as follows.

• a) With the complete integration of the Demerged Undertaking with Resulting Company, the manufacturing and machining capacity of the Resulting Company will stand enhanced. Since, PIL fulfils its raw material supply (i.e., Raw Castings) needs from PAIL, the Demerger would eliminate the inter dependence and shall be a forward integration of manufacturing and machining activities of PAIL which in turn add to efficiency, economy in operations and ultimately add to shareholders wealth.

• b) PIL and PAIL are in the same line of business and cater the needs of same customers (i.e. OEMs). The Scheme of Arrangement would consolidate and synchronize the business structure and eliminate the unnecessary competition and conflict of interest within the group which will create transparency and confidence with the investors and the market.

• c) The Demerged Company currently has business interest in diverse businesses such as Manufacturing, Healthcare and Investment & Financing activities and other allied activities. With a view to achieve greater management focus in other business activities, Demerged Company proposes to demerge its business interest in the Demerged Undertaking and vest the same in the Resulting Company.

• d) The consolidation of operations of the Manufacturing Business of Demerged Company and the Resulting Company by merging the Demerged Undertaking into Resulting Company, will lead to a more efficient utilisation of capital, administrative and operational rationalization and promote organisational efficiencies. It will help achieve cost efficiency that will enhance the financial efficiencies and help achieve economies of scale, reduction in overheads and improvement in various other operating parameters.

• e) The Demerged undertaking and remaining undertaking have their own set of strengths and dynamics in the form of nature of risks, competition, challenges, opportunities and business methods leading to different growth potentials. Hence segregation of the two undertakings would enable a focused management to explore the potential business opportunities effectively and efficiently.

• f) The demerger would result in achieving efficiency in operational process by designing and implementing independent strategies specifically designed for the two businesses and in optimising profitability. This would in turn enhance the shareholders wealth.

• g) Targeting and attracting new investors with specific focus and expertise in the two businesses thereby providing the necessary funding impetus to the long-term growth strategy of the two businesses.

• h) Integration would result in maximising overall shareholder value, improvising the competitive position and enabling to unlock the economic value of both the entities.

• i) Improved organisational capability and leadership, arising from the pooling of human capital who have the diverse skills, talent and vast experience to compete successfully in an increasingly competitive industry.

• j) Cost savings are expected to flow from more focused operational efforts, rationalization, standardisation and simplification of business processes, and the elimination of duplication, and rationalization of administrative expenses.

In view of the aforesaid, the Board of Directors of the Demerged Company and the Resulting Company have considered it desirable and expedient to demerge the Demerged Undertaking of the Demerged Company and vest the same with the Resulting Company, in order to benefit the stakeholders of both the companies.

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Major Developments / Actions post announcement of the Scheme

1. There are no major developments / actions taken place since announcement of the scheme.

Corporate Approvals

1. The proposed Scheme was placed before the Audit Committee of PAIL at its meeting held on 14th day of August, 2021. The Audit Committee of PAIL took into account the Scheme. The Audit Committee of PAIL based on the aforesaid, inter alia, recommended the Scheme to the Board of Directors of PAIL.

2. The Scheme alongwith the Valuation Report was placed before the Board of Directors of PAIL, at its meeting held on 14th day of August, 2021. The report of the Audit Committee was also submitted to the Board of Directors of PAIL. Based on the aforesaid, the Board of Directors of PAIL approved the Scheme. The meeting of the Board of Directors of PAIL, held on 14th day of August, 2021, was attended by all the six directors (namely, Mr. Raminder Singh Nibber, Mr. Harpreet Singh Nibber, Mr. Ajay Kumar, Mr. Yudhisthir Lal Madan, Mr. Subramaniyam Bala and Mrs. Neha). None of the Directors of PAIL who attended the meeting voted against the Scheme. Thus, the Scheme was approved unanimously by the Directors of PAIL who attended and voted at the meeting.

3. The proposed Scheme was placed before the Audit Committee of PIL at its meeting held on 14th day of August, 2021. The Audit Committee of PIL took into account the Scheme. The Audit Committee of PIL based on the aforesaid, inter alia, recommended the Scheme to the Board of Directors of PIL.

4. The Scheme alongwith the valuation Report was placed before the Board of Directors of PIL, at its meeting held on 14th day of August, 2021. The Board of Directors of PIL approved the Scheme. The meeting of the Board of Directors of PIL, held on 14th day of August, 2021, was attended by all the five directors (namely, Mr. Raminder Singh Nibber, Mr. Harpreet Singh Nibber, Mr. Ajay Kumar, Mr. Subramaniyam Bala and Mrs. Neha). None of the Directors of PIL who attended the meeting voted against the Scheme. Thus, the Scheme was approved unanimously by the Directors of PIL who attended and voted at the meeting.

5. For the purposes of the Scheme, a report in relation to the Share Exchange Ratio (hereinafter referred to as “ Valuation Report ”) for issuance and allotment of shares of PAIL to the shareholders of PIL pursuant to and in consideration of the Demerger, on 14th August, 2021, was issued by FCA Payal Gada, Proprietor; Payal Gada & Co, Chartered Accountants (Registered Valuer Registration No. IBBI Registration No.: IBBI/RV/06/2019/11170) describing, inter alia, the methodologies adopted by her in arriving at the Share Exchange Ratio and setting out the detailed computation of the Share Exchange Ratio for the proposed Demerger. The Valuation Report has been enclosed as Annexure 2 .

In the Valuation Report, the valuer has understood that upon the Scheme being effective and in consideration of transfer and vesting of the Undertaking (as defined under the Scheme) from PIL to PAIL in terms of the Scheme, PAIL shall issue and allot equity shares to the shareholders of PIL in accordance with the Share Exchange Ratio. As such, 63 (Sixty-three) equity shares of PAIL (“Resulting Company”) of INR 2/- each fully paid up be issued to equity shareholders of PIL (“Demerged Company”), in addition to, not substitution of, for every 10(ten) equity shares of INR 10/- each fully paid of PIL (“Demerged Company”) as consideration for Demerger.

In compliance with SEBI circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and SEBI circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3 r d November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 and Master Circular No. SEBI/HO/CFD/DIL1/ CIR/P/2021/0000000665 dated November 23, 2021 (" SEBI Circular ") issued by the Securities and Exchange Board of India (" SEBI "), a Fairness Opinion dated 14th August, 2021 has been issued by Systematix Corporate Services Limited, a Category-1 Merchant Banker, Mumbai (SEBI Registration No. INM000004224) (“ Fairness Opinion ”) on the Share Exchange Ratio as recommended in the Valuation Report. The Fairness Opinion has been enclosed as Annexure 3 .

The recommendation of the Share Exchange Ratio has been approved by the audit committee and board of directors the PAIL and the audit committee and the board of directors of PIL.

Approvals and actions taken in relation to the Scheme

1. BSE has been appointed as the designated stock exchange by PAIL for the purpose of coordinating with the SEBI, pursuant to the SEBI Circular. PAIL has received observation letters regarding the Scheme from BSE and NSE, dated 14th day of January, 2022 and 14th day of January, 2022 respectively. In terms of the observation letters of BSE and NSE, dated 14th day of January, 2022 and 14th day of January, 2022 respectively, BSE and NSE, inter alia, conveyed their no adverse observations/no objection for filing the Scheme with the Hon’ble National Company Law Tribunal. Copies of

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the observation letters, dated 14th day of January, 2022 and 14th day of January, 2022 received from BSE and NSE, respectively, are enclosed as Annexure 4 and 5 .

1. As required by the SEBI Circular, PAIL had filed the complaints report dated 8th day of November, 2021 and 15th day of November, 2021 with both BSE and NSE, respectively. This report indicates that PAIL received nil complaints. A copy of the complaints report submitted by PAIL to BSE and NSE, dated 8th day of November, 2021 and 15th day of November, 2021 are enclosed as Annexure 6 and Annexure 7 .

2. The Companies or any of them would obtain such necessary approvals/sanctions/no objection(s) from the regulatory or other governmental authorities in respect of the Scheme in accordance with law, if so required.

3. The joint applications along with the annexure thereto (which includes the Scheme) were filed by the Companies with the NCLT, on 28th day of March, 2022.

4. This notice convening Meeting of the Equity Shareholders of the Applicant Company along with aforesaid documents are placed on the website of the Company viz. www.pritikaautoindustries.comand being sent to Securities and Exchange Board of India and BSE Limited and National Stock Exchange of India Limited (NSE) for placing on their website.

Salient extracts of the Scheme

1. The salient extracts of the Scheme are as Under:

DEFINITIONS

• A . “ Appointed Date ” would mean1st April, 2021 or such other date as may be fixed or approved by the National Company Law Tribunal, Chandigarh Bench, Chandigarh.

• B. “ Demerged Undertaking ” means the ‘Automotive/Tractor/Engineering Components Business Undertaking’ of the Demerged Company, which shall include business, activities and operations pertaining to the ‘Automotive/Tractor/Engineering Components (hereinafter also referred to as ‘Automotive/Tractor/Engineering Components Business Undertaking’)of the Demerged Company on a going concern basis, and shall mean and include, without limitation:

All assets and properties of the ‘Automotive/Tractor/Engineering Components Business Undertaking’ including all assets whether situated in India or abroad, (whether movable or immovable), related liabilities pertaining thereto including contingent liabilities, liabilities not accrued, not recognized or not provided for in the books of accounts of the Demerged Company.

Without prejudice to the generality of the above, the Demerged Undertaking shall include in particular:

• i. all immovable properties i.e. land together with the buildings and structures standing thereon (whether freehold, leasehold, leave and licensed, right of way, tenancies or otherwise) including offices, structures, workshop, benefits of any rental agreement for use of premises, marketing offices, share of any joint assets, etc., which immovable properties are currently being used exclusively and solely for the purpose of and in relation to the ‘Automotive/Tractor/Engineering Components Business Undertaking’ and all documents (including panchnamas, declarations, receipts) of title, rights and easements in relation thereto and all rights, covenants, continuing rights, title and interest in connection with the said immovable properties;

• ii. all assets, as are movable in nature and exclusively and solely pertaining to and in relation to the ‘Automotive/Tractor/Engineering Components Business Undertaking’, whether present or future or contingent, tangible or intangible including goodwill, whether recorded in the books or not, in possession or reversion, including electrical fittings, furniture, fixtures, appliances, accessories, power lines, office equipments, computers, communication facilities, installations, tools, plants, vehicles, inventory and stock in trade, wherever lying, actionable claims, current assets, earnest monies and sundry debtors, financial assets, outstanding loans and advances recoverable in cash or in kind or for value to be received, provisions, receivables, funds, cash and bank balances and deposits including accrued interest thereto with Government, semi-Government, local and other authorities and bodies, banks, customers and other Persons, insurances, the benefits of any bank guarantees, performance guarantees and letters of credit;

• iii. all permits, licenses, permissions, approvals, clearances, consents, benefits, registrations, rights, entitlements, credits, certificates, awards, sanctions, allotments, quotas, no objection certificates, exemptions, concessions, subsidies, liberties and advantages including those relating to privileges, powers, facilities of every kind and

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description of whatsoever nature and the benefits thereto that pertain exclusively and solely to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• iv. all contracts, agreements, purchase orders/service orders, operation and maintenance contracts, memoranda of understanding, memoranda of undertakings, memoranda of agreements, memoranda of agreed points, minutes of meetings, bids, tenders, expression of interest, letter of intent, hire and purchase arrangements, lease/license agreements, tenancy rights, agreements/panchnamas for right of way, equipment purchase agreements, agreement with customers, purchase and other agreements with the supplier/manufacturer of goods/service providers, other arrangements, undertakings, deeds, bonds, schemes, insurance covers and claims, clearances and other instruments of whatsoever nature and description, whether written, oral or otherwise and all rights, title, interests, claims and benefits there under exclusively and solely pertaining to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• v. all applications (including hardware, software, licenses, source codes, and scripts), registrations, licenses, trade names, service marks, trademarks, copyrights, patents, domain names, designs, intellectual property rights (whether owned, licensed or otherwise, and whether registered or unregistered), trade secrets, research and studies, technical knowhow, confidential information and all such rights of whatsoever description and nature that in each case pertain exclusively and solely to the ‘Automotive/Tractor/Engineering Components Business Undertaking’ including, without limitation, the intellectual properties of the Demerged Company;

• vi. all rights to use and avail telephones, telexes, facsimile, email, internet, leased line connections and installations, utilities, electricity and other services, reserves, provisions, funds, benefits of assets or properties or other interests held in trusts, registrations, contracts, engagements, arrangements of all kind, privileges and all other rights, easements, liberties and advantages of whatsoever nature and wheresoever situated belonging to or in the ownership, power or possession and in control of or vested in or granted in favour of or enjoyed by the Demerged Company and exclusively and solely pertaining to or in connection with the ‘Automotive/Tractor/Engineering Components Business Undertaking’ and all other interests of whatsoever nature belonging to or in the ownership, power, possession or control of or vested in or granted in favour of or held for the benefit of or enjoyed by the Demerged Company and exclusively and solely pertaining to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• vii. all tax related assets, all the credits for taxes such as sales tax, MAT tax credit, service tax, CENVAT, GST, tax deduction at source, accumulated losses and unabsorbed depreciation as per books if any as well as per the IT Act enjoyed by the Demerged Company pertaining to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• viii. all books, records, files, papers, engineering and process information, software licenses (whether proprietary or otherwise), test reports, computer programmes, drawings, manuals, data, databases including databases for procurement, commercial and management, catalogues, quotations, sales and advertising materials, product registrations, dossiers, product master cards, lists of present and former customers and suppliers including service providers, other customer information, customer credit information, customer/supplier pricing information, and all other books and records, whether in physical or electronic form that pertain to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• ix. all debts, liabilities, duties, taxes and obligations of the Demerged Company pertaining to the ‘Automotive/Tractor/Engineering Components Business Undertaking’, namely:

• a. the debts of the Demerged Company which arises out of the activities or operations of the - ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• b. specific loans and borrowings raised, incurred and utilized for the activities or operations of or pertaining to ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• c. general and multipurpose borrowings of the Demerged Company shall be allocated to ‘Automotive/Tractor/Engineering Components Business Undertaking’ in the same proportion which the value of the assets transferred under this Scheme bears to the total value of assets of Demerged Company immediately before the demerger;

• x. all liabilities (including contingent liabilities, liabilities not accrued, not recognized or provided for in the books of accounts of the Demerged Company), present liability as accounted in the books of the Demerged Company whether secured or unsecured, pertaining to the Demerged Undertaking;

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• xi. all employees of the Demerged Company employed/engaged exclusively and solely in the ‘Automotive/Tractor/Engineering Components Business Undertaking’ as on the Effective Date; and

• xii. all legal or other proceedings of whatsoever nature relating to the ‘Automotive/Tractor/Engineering Components Business Undertaking’.

( Note 1 : - For the purposes of this Scheme, a statement of account of the ‘Automotive/Tractor/Engineering Components Business Undertaking’ of the Demerged Company is drawn up as on the Appointed Date which gives details of assets and liabilities of the Demerged undertaking.)

( Note 2 : - In case of any question that may arise as to whether any particular asset or liability and/or employee pertains or does not pertain exclusively and solely to the ‘Automotive/Tractor/Engineering Components Business Undertaking’ or whether it arises out of the activities or operations of the ‘Automotive/Tractor/Engineering Components Business Undertaking’, the same shall be decided by mutual agreement between the Board of Directors of the Demerged Company and the Resulting Company.)

• C . “ Effective Date ” means the later of the dates on which the certified copies of the orders sanctioning this Scheme, passed by the National Company Law Tribunal or such other competent Authority, as may be applicable, are filed with the Registrar of Companies, at Punjab & Chandigarh by PIL and PAIL.

D. Transfer of Assets

• With effect from the Effective Date the Demerged Undertaking (including all the estate, assets, rights including claims, title, interest and authorities including accretions and appurtenances of the Demerged Undertaking) shall, subject to the provisions of Clause 5 of Part II of the Scheme in relation to the mode of transfer and vesting and pursuant to the provisions of Section 232(3) of the Act, without any further act or deed, be demerged from the Demerged Company and be transferred to and vested in and shall be deemed to be demerged from the Demerged Company and transferred to and vested in the Resulting Company as a going concern so as to become as and from the Appointed Date, the estate, assets, rights, claims, title, interest and authorities of the Resulting Company, subject to the provisions of this Scheme

• In respect of such of the assets of the Demerged Undertaking as are movable in nature or are otherwise capable of transfer by delivery or possession or by endorsement and delivery, the same shall stand so transferred by the Demerged Company upon the coming into effect of the Scheme, and shall become the property of the Resulting Company as an integral part of the Demerged Undertaking with effect from the Appointed Date pursuant to the provisions of Section 232 of the Act without requiring any deed or instrument of conveyance for transfer of the same, subject to the provisions of this Scheme in relation to Encumbrances in favour of banks and/or financial institutions.

• In respect of such of the assets belonging to the Demerged Undertaking other than those referred to in sub-clause 5.2 above, the same shall, without any further act, instrument or deed, be demerged from the Demerged Company and transferred to and vested in and/or be deemed to be demerged from the Demerged Company and deemed to be transferred to and vested in the Resulting Company upon the coming into effect of Part II of the Scheme and with effect from the Appointed Date pursuant to the provisions of Sections 230 to 232 of the Act.

E. Transfer Of Contracts, Agreements, Deeds, MOU, Permits, Quotas And Licenses Etc. Of Demerged Undertaking.

• Upon the coming into effect of the Scheme, and subject to the provisions of this Scheme, all contracts, deeds, bonds, agreements, Schemes, arrangements and other instruments of whatsoever nature in relation to the Demerged Undertaking, to which the Demerged Company is a party or to the benefit of which the Demerged Company may be eligible, and which are subsisting or have effect immediately before the Effective Date shall continue in full force and effect on or against or in favour, as the case may be, of the Resulting Company and may be enforced as fully and effectually as if, instead of the Demerged Company, the Resulting Company had been a party or beneficiary or obligee thereto or there under.

• Without prejudice to the other provisions of this Scheme and notwithstanding the fact that vesting of the Demerged Undertaking occurs by virtue of this Scheme itself, the Resulting Company may, at any time after the coming into effect of the Scheme, in accordance with the provisions hereof, if so required under any law or otherwise, take such actions and execute such deeds (including deeds of adherence), confirmations or other writings or tripartite arrangements with any party to any contract or arrangement to which the Demerged Company is a party or any writings as may be necessary in order to give formal effect to the provisions of this Scheme.

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• Without prejudice to the generality of the foregoing, it is clarified that upon the coming into effect of the Scheme, all consents, permissions, licenses, approvals, certificates, insurance covers, clearances, authorities given by, issued to or executed in favour of the Demerged Company in relation to the Demerged Undertaking shall stand transferred to the Resulting Company as if the same were originally given by, issued to or executed in favour of the Resulting Company, and the Resulting Company shall be bound by the terms thereof, the obligations and duties there under, and the rights and benefits under the same shall be available to the Resulting Company.

• Without prejudice to the aforesaid, it is clarified that if any assets (including estate, claims, rights, title, interest in or authorities relating to any asset) or any contracts, deeds, bonds, agreements, schemes, arrangements or other instruments of whatsoever nature in relation to the Demerged Undertaking which the Demerged Company owns or to which the Demerged Company is a party to, cannot be transferred to the Resulting Company for any reason whatsoever, the Demerged Company shall hold such assets, contracts, deeds, bonds, agreements, Schemes, arrangements or other instruments of whatsoever nature in trust for the benefit of the Resulting Company, insofar as it is permissible so to do, till such time as the transfer is effected.

F. Transfer Of Liabilities And Related Securities /Charges

• Upon the coming into effect of the Scheme, all loans raised and used, debts, liabilities, duties and obligations (including the liabilities which arise out of the activities or operations of the Demerged Undertaking) of the Demerged Company as on the Appointed Date and relatable to the Demerged Undertaking shall, without any further act or deed, be and stand transferred to and be deemed to be transferred to the Resulting Company to the extent that they are outstanding as on the Effective Date and shall become the loans, debts, liabilities, duties and obligations of the Resulting Company.

• All loans raised and used and all debts, liabilities, duties and obligations incurred by the Demerged Company for the operations of the Demerged Undertaking after the Appointed Date and prior to the Effective Date, subject to the terms of this Scheme, shall be deemed to have been raised, used or incurred for and on behalf of the Resulting Company and to the extent they are outstanding on the Effective Date, shall also without any further act or deed be and stand transferred to and be deemed to be transferred to the Resulting Company and shall become the loans, debts, liabilities, duties and obligations of the Resulting Company.

• In so far as the existing Encumbrance in respect of the loans, borrowings, debts, liabilities, is concerned, such Encumbrance shall, without any further act, instrument or deed be modified and shall be extended to and shall operate only over the assets comprised in the Demerged Undertaking which have been Encumbered in respect of the such loans, borrowings, debts, liabilities as transferred to the Resulting Company pursuant to this Scheme. Provided that if any of the assets comprised in the Demerged Undertaking which are being transferred to the Resulting Company pursuant to this Scheme have not been Encumbered in respect of such loans, borrowings, debts, liabilities, such assets shall remain unencumbered and the existing Encumbrance referred to above shall not be extended to and shall not operate over such assets. The absence of any formal amendment which may be required by a lender or third party shall not affect the operation of the above.

• For the avoidance of doubt, it is hereby clarified that in so far as the assets comprising the Remaining Business are concerned, the Encumbrance over such assets relating to such loans, borrowings, debts, liabilities shall, as and from the Effective Date without any further act, instrument or deed be released and discharged from the obligations and encumbrance relating to the same. The absence of any formal amendment which may be required by a lender or third party shall not affect the operation of the above. Further, in so far as the assets comprised in the Demerged Undertaking are concerned, the Encumbrance over such assets relating to any loans, borrowings or other debts which are not transferred pursuant to this Scheme (and which shall continue with the Demerged Company), shall without any further act or deed be released from such Encumbrance and shall no longer be available as security in relation to such liabilities.

• Without prejudice to the provisions of the foregoing Clauses and upon the effectiveness of this Scheme, the Demerged Company and the Resulting Company shall execute any instrument/s and/or document/s and/or do all the acts and deeds as may be required, including the filing of necessary particulars and/or modification(s) of charge, with the Registrar of Companies to give formal effect to the above provisions, if required.

• Upon the coming into effect of this Scheme, the Resulting Company alone shall be liable to perform all obligations in respect of the Transferred Liabilities, which have been transferred to it in terms of this Scheme, and the Demerged Company shall not have any obligations in respect of such Transferred Liabilities.

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G. Employee Matters

• Upon the coming into effect of this Scheme, all Employees of the Demerged Undertaking shall become the employees of the Resulting Company with effect from the Appointed Date, and, subject to the provisions hereof, on terms and conditions not less favourable than those on which they are engaged by the Demerged Company in relation to the Demerged Undertaking and without any interruption of or break in service as a result of the transfer of the Demerged Undertaking. For the purpose of payment of any compensation, gratuity and other terminal benefits, the immediate past services of such Employees with the Demerged Company shall also be taken into account, and paid by the Resulting Company as and when the same become payable.

• In so far as the provident fund and gratuity fund and any other funds or benefits if any created by the Demerged Company inter alia for the Employees are concerned (collectively referred to as the "Funds"), the funds and such investments made by the Funds which are referable to the Employees in terms of sub-Clause 8.1 above shall be transferred to the Resulting Company and shall be held for their benefit pursuant to this Scheme in the manner provided hereinafter. In the event that the Resulting Company does not have its own Funds in respect of any of the above, the Resulting Company may, subject to necessary approvals and permissions, continue to contribute to the relevant Funds of the Demerged Company, until such time that the Resulting Company creates its own Funds, at which time the funds and the investments and contributions pertaining to the Employees shall be transferred to the Funds created by the Resulting Company.

• In relation to any other fund created or existing for the benefit of the Employees being transferred to the Resulting Company, the Resulting Company shall stand substituted for the Demerged Company, for all purposes whatsoever, including relating to the obligation to make contributions to the said funds in accordance with the provisions of such Scheme, funds, bye laws, etc. in respect of such Employees.

H. Legal, Taxation And Other Proceedings

• Upon the coming into effect of this Scheme, all legal, taxation or other proceedings, (including before any statutory or quasi-judicial authority or tribunal) by or against the Demerged Company under any statute, whether pending on the Appointed Date or which may be instituted any time thereafter and, in each case, relating to the Demerged Undertaking shall be continued and enforced by or against the Resulting Company with effect from the Effective Date. Except as otherwise provided herein, the Demerged Company shall in no event be responsible or liable in relation to any such legal, taxation or other proceedings against the Resulting Company. The Resulting Company shall be replaced/ added as party to such proceedings and shall prosecute or defend such proceedings at its own cost, in co-operation with the Demerged Company.

• If any proceedings are taken against the Demerged Company in respect of the matters referred to in sub-Clause 9.1 of the Scheme, it shall defend the same in accordance with any reasonable and prudent advice provided by the Resulting Company at the cost of the Resulting Company, and the latter shall reimburse and indemnify the Demerged Company against all liabilities and obligations incurred by the Demerged Company in respect thereof.

• The Resulting Company undertakes to have all legal, taxation or other proceedings initiated by or against the Demerged Company in relation to Demerged Undertaking referred to in sub-Clause 9.1 of the Scheme transferred to its name as soon as is reasonably possible after the Effective Date and to have the same continued, prosecuted and enforced by or against the Resulting Company to the exclusion of the Demerged Company. Both companies shall make relevant applications in that behalf.

I. Conduct of Business

• The Demerged Company, with effect from the Appointed Date and up to and including the Effective Date:

• shall be carrying on and be deemed to have been carrying on all business and activities relating to the Demerged Undertaking and shall hold and stand possessed of and shall be deemed to hold and stand possessed of all the estates, assets, rights, title, interest, authorities, contracts, investments and strategic decisions of the Demerged Undertaking for and on account of, and in trust for, the Resulting Company;

• all profits and income accruing or arising to the Demerged Company from the Demerged Undertaking, and losses and expenditure arising or incurred by it (including taxes, if any, accruing or paid in relation to any profits or income) relating to the Demerged Undertaking for the period commencing from the Appointed Date shall, for all purposes, be treated as and be deemed to be the profits, income, losses or expenditure, as the case may be, of the Resulting Company;

• any of the rights, powers, authorities, privileges, attached, related or pertaining to the Demerged Undertaking exercised by the Demerged Company shall be deemed to have been exercised by the Demerged Company for and on behalf of,

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and in trust for and as an agent of the Resulting Company. Similarly, any of the obligations, duties and commitments attached, related or pertaining to the Demerged Undertaking that have been undertaken or discharged by the Demerged Company shall be deemed to have been undertaken for and on behalf of and as an agent for the Resulting Company;

• With effect from the effective Date, the Resulting Company shall be duly authorized to carry on the business of the Demerged Undertaking previously carried on by the Demerged Company. The Resulting Company agrees and undertakes to pay, discharge and satisfy all the liabilities and obligations of the Demerged Undertaking with effect from the Appointed Date, in order to give effect to the foregoing provisions.

• To avoid any undue hardship to the Demerged company or the Resulting Company on account of disruption of business post the effective date, the Resulting Company shall be entitled to use all the business authorizations, including licenses, contracts etc. having the name of the Demerged company in connection with the Demerged Undertaking, till such authorizations are issued afresh / transferred / renewed in the name of the Resulting Company.

• On and from the Effective date and till such time that the name of the bank accounts of the Demerged Company, in relation to or in connection with the Demerged Undertaking, have been replaced with that of the Resulting Company, the Resulting Company shall be entitled to maintain and operate the bank account of the Demerged Company pertaining to the Demerged Undertaking, in the name of the Demerged Company for such time as may be determined to be necessary by the Resulting Company. All cheques and other negotiable instruments, payment orders received or presented for encashment which are in the name of the Demerged Company, in relation to or in connection with the Demerged Undertaking after the effective date shall be accepted by the bankers of the Resulting Company and credited to the account of the Resulting Company if presented by the Resulting Company and

• the Demerged Company shall carry on the Remaining Business in terms of Section 3 of Part II of this Scheme distinctly and as a separate business from the Demerged Undertaking.

J. Remaining Business / Retained Undertaking

The Remaining Business and all the assets, liabilities and obligations pertaining thereto shall continue to belong to and be vested in and be managed by the Demerged Company.

All legal, taxation or other proceedings (including before any statutory or quasi-judicial authority or tribunal) by or against the Demerged Company under any statute, whether pending on the Appointed Date or which may be instituted at any time thereafter, and in each case relating to the Remaining Business (including those relating to any property, right, power, liability, obligation or duties of the Demerged Company in respect of the Remaining Business) shall be continued and enforced by or against the Demerged Company after the Effective Date. The Resulting Company shall in no event be responsible or liable in relation to any such legal, taxation or other proceedings against the Demerged Company, which relates to the Remaining Business.

If proceedings are taken against the Resulting Company in respect of the matters referred to in sub-Clause 9.1 of the Scheme, it shall defend the same in accordance with the advice of the Demerged Company and at the cost of the Demerged Company, and the latter shall reimburse and indemnify the Resulting Company against all liabilities and obligations incurred by the Resulting Company in respect thereof.

With effect from the Appointed Date and up to and including the Effective Date:

• a. the Demerged Company shall carry on and be deemed to have been carrying on all business and activities relating to the Remaining Business for and on its own behalf;

• b. all profits accruing to the Demerged Company thereon or losses arising or incurred by it including the effect of taxes, if any, thereon) relating to the Remaining Business shall, for all purposes, be treated as the profits or losses, as the case may be, of the Demerged Company;

• c. all assets acquired and all liabilities incurred by the Demerged Company after the Appointed Date but prior to the Effective Date for operation of and in relation to the Demerged Undertaking shall also without any further act, instrument or deed stand transferred to and vested in or to be deemed to have been transferred to or vested in the Resulting Company upon the coming into effect of the Scheme

K. CONSIDERATION

• Upon the Scheme coming into effect, in consideration of the transfer of the Demerged Undertaking by the Demerged Company to the Resulting Company, in terms of this Scheme, the Resulting Company shall, without any further act or

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deed, issue and allot to every member of the Demerged Company holding fully paid up equity shares in the Demerged Company and whose names appear in the Register of Members of the Demerged Company on the Demerger Record Date in respect of every 10 (Ten) Equity Shares of the face value of Rs. 10/- (Rupees Ten) each fully paid up held by him / her / it in the Demerged Company, 63 (Sixty-Three) new Equity shares of the Resulting Company of the face value of Rs.2/- (Rupees Two) each fully paid up.

• The equity shares issued and allotted by the Resulting Company in terms of this Scheme shall rank pari passu in all respects with the existing equity shares of the Resulting Company.

• The issue and allotment of new equity shares by the Resulting Company to the Shareholders of the Demerged Company pursuant to Clause 16 of the Scheme is an integral part of this Scheme.

• Fraction shares will be ignored.

• The shares issued pursuant to Clause 16 of Part II of the Scheme (“New Shares”), shall be issued to the shareholders of the Demerged Company in demat form, i.e. dematerialized shares unless otherwise notified in writing by a shareholder of the Demerged Company to the Resulting Company on or before such date as may be determined by the Board of Resulting Company. In the event that such notice has not been received by Resulting Company in respect of any of the shareholders of Demerged Company, the equity shares, shall be issued to such shareholders in dematerialized form provided that the shareholders of Demerged Company shall be required to have an account with a depository participant and shall be required to provide details thereof and such other confirmations as may be required. In the event that Resulting Company has received notice from any shareholder that the equity shares are to be issued in physical form or if any shareholder has not provided the requisite details relating to his/ her/ its account with a depository participant or other confirmations as may be required or if the details furnished by any shareholder do not permit electronic credit of the shares of Resulting Company, then the Resulting Company shall issue the equity shares in physical form to such shareholder or shareholders.

• Unless otherwise determined by the Board of Directors or any committee thereof of the Demerged Company and the Resulting Company, allotment of shares in terms of Clause 16 of Part II of the Scheme shall be done within 45 days from the Demerger Record Date.

• The New Shares allotted and issued in terms of Clause 16 of Part II of the Scheme, shall be listed and/or admitted to trading on the Stock Exchanges after obtaining the requisite approvals. The Resulting Company shall enter into such arrangements and give such confirmations and/or undertakings as may be necessary in accordance with Applicable Laws for complying with the formalities of the Stock Exchanges.

• The equity shares of the Resulting Company allotted pursuant to the Scheme shall remain frozen in the depositories system till listing / trading permission is given by the designated stock exchange.

• Till the listing of the equity shares of the Resulting Company, there will be no change in the pre-arrangement capital structure and shareholding pattern or controls in the Resulting Company which may affect status of the approval of the stock exchanges to this Scheme.

• Approval of the Scheme by the shareholders of Pritika Auto Industries Limited (PAIL) shall be deemed to be due compliance of the provisions of section 42, 62 if any and other relevant or applicable provisions of the Companies Act, 2013 and Rules made thereunder for the issue and allotment of the Equity shares by PAIL to the shareholders of PIL as provided hereinabove.

L. Accounting Treatment In The Books Of The Demerged Company

The Demerged Company shall account for Demerger of Demerged Undertaking in its books as per the applicable accounting principles prescribed under the relevant IND – AS. It shall inter alia include the following:

• The Demerged Company shall in its books of accounts reduce the respective carrying values of the assets and liabilities of the Demerged Undertaking being transferred to and vested in the Resulting Company at values appearing in Books of Accounts of the Demerged Company as on the Appointed Date.

• The aggregate of the net assets (i.e. difference between the carrying value of assets and liabilities related to the Demerged Undertaking) standing in the books of accounts of the Demerged company transferred to the Resulting Company on the appointed date, shall be either debited or credited to Goodwill or Capital Reserve as the case may be.

• The investment of the Demerged Company into the Equity share Capital of the resulting Company as on the effective date shall not stand reduced or cancelled and the same will continue to hold by the Demerged Company.

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• Notwithstanding anything above, the Board of Directors of the Demerged Company in consultation with their statutory auditors is authorized to account for any of the above-mentioned transactions or any matter not dealt with under this clause in accordance with the applicable Indian Accounting Standards prescribed under section 133 of the Companies Act, 2013 and generally accepted accounting principles.

M. Accounting Treatment In The Books Of The Resulting Company

The Resulting Company shall account for the Demerger of Demerged Undertaking using pooling of interest method in accordance with Appendix C- “Business Combinations of entities under common control” of Ind -As 103- “Business Combinations”. It shall inter alia include the following

• The Resulting Company shall record all the assets and liabilities of the Demerged Undertaking transferred to it in pursuance of this Scheme at their respective carrying values appearing in the books of accounts of the Demerged Company as on the Appointed date which are set forth in the closing balance sheet of the Demerged Company as of the close of business hours on the date immediately preceding the Appointed Date

• The Resulting Company shall credit its share Capital account, with the aggregate face value of the new equity shares issued to the shareholders of the Demerged company pursuant to the demerger of the Demerged Undertaking

• To the extent there are intercompany balance(s) and transactions between the Resulting company and the Demerged Undertaking if any the rights and obligations in respect thereof will stand cancelled.

• The difference between the book value of assets and book value of liabilities so recorded in the books of the Resulting Company in accordance with 27.2 as reduced by the amount credited as share capital in accordance with clause 27.3, shall be recorded either as Goodwill or Capital Reserve as the case may be.

• In case of any difference in accounting policy followed by Demerged company in respect of Demerged Undertaking vis a vis the accounting policy followed by the Resulting Company, the impact of the same till the Appointed Date will be quantified and adjusted in Reserves of the Resulting Company, to ensure that upon coming into effect of this Scheme, the financial statements of the Resulting company reflect the financial position on the basis of a consistent accounting policy.

• Notwithstanding anything above, the Board of Directors of the Resulting Company in consultation with their statutory auditors, is authorized to account for any of the above-mentioned transactions or any matter not dealt with under this clause in accordance with the applicable Indian Accounting Standards prescribed under section 133 of the Companies Act, 2013 and generally accepted accounting principles.

N. Treatment Of Taxes

• With effect from the Appointment Date and upon the Scheme becoming effective, all taxes and duties (including but not limited to Income Tax, Goods and Services Tax etc.) paid or payable by Demerged Company and relating to the operations of the Demerged Undertaking, including all advance tax payments, tax deducted at source, credits for minimum alternate tax, shall for all purposes be treated as tax, duty or cess liability, advance tax payments, tax deducted at source, credits for minimum alternate tax as the case may be of the Resulting Company.

• Upon the Scheme becoming effective, the Demerged Company and the Resulting Company shall be permitted to revise from the Appointed Date, their respective financial statements and returns along with prescribed forms, filings and annexures under the Income Tax Act 1961, Goods and Services Tax Laws, Custom Law and other tax Laws and to claim refunds and / or credit for taxes paid (including minimum alternate tax, tax deducted at source etc.) and for matters incidental thereto, if required to give effect to the provisions of the Scheme and to claim refunds / credits, pursuant to provisions of this Scheme.

• Upon the Scheme becoming effective, the Demerged Company and the Resulting Company would undertake appropriate filings under the Goods and Service Tax Rules, to facilitate claim of refunds and / or transfer of credit for taxes paid and for matters incidental thereto in relation to the Demerged Undertaking available with the Demerged Company.

• All disallowances under Section 43 B of the Income Tax Act, 1961 in the hands of the Demerged Company, in relation and pertaining to the Demerged Undertaking shall be claimed as a deduction under Section 43 B of the Income Tax Act, 1961 by the Resulting company when the payment is made by the Resulting Company against such expenses.

• Any refunds or credits (including credit for minimum alternate tax, advance tax and tax deducted at source under the provisions of Income Tax Act, 1961), benefit or carry forward losses and other statutory benefits under the Income Tax

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Act, 1961. Service Tax laws, Central sales tax, Goods and Services Tax, applicable State Value Added Tax Laws or other applicable laws / regulations dealing with taxes / duties /levies due to the Demerged Company, relating to Demerged Undertaking including refunds, benefits or credits consequent to the assessment made on the Demerged Company (including any refund for which no credit is taken in the accounts of the Demerged Company) as on the date immediately preceding the Appointed Date shall also belong to and be received by the Resulting Company upon the Scheme becoming effective.

• Further any tax deducted at source by the Demerged Company with respect to the Demerged Undertaking on transactions with the Resulting Company, if any (from the Appointed Date to the Effective Date) shall be deemed to be advance tax paid by the Resulting company and shall in all proceedings, be dealt with accordingly and vice versa.

• Upon the Scheme coming into effect any obligation of tax deduction at source on any payment made by or to be made by the Demerged Company relating to the Demerged Undertaking shall be made or deemed to have been made and duly complied with the Resulting Company.

O. Scheme Conditional On

This Scheme is conditional upon and subject to:

• The requisite consents, no-objections and approvals of the Stock Exchanges and SEBI to the Scheme in terms of the SEBI Circular and under Regulation 37 of SEBI(LODR) Regulations, 2015, on terms acceptable to the Demerged Company and the Resulting Company.

• the Scheme being agreed to by the respective requisite majorities of the various classes of members and creditors of the Demerged Company and the Resulting Company as required under the Act and the requisite order of the National Company Law Tribunal, Chandigarh Bench, Chandigarh being obtained.

• As para 9 of SEBI Circular No. CFD/ DIL3 / CIR /2017 / 21 dated 10th March, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 as amended from time to time is applicable to this Scheme; therefore, it is provided in the Scheme that the Resulting Company will provide voting by the public shareholders through e-voting and will disclose all material facts in the explanatory statement to be sent to the shareholders in relation to the said Resolution.

• As para 9 of SEBI Circular No. CFD/ DIL3 / CIR /2017 / 21 dated 10th March, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 as amended from time to time is applicable to this Scheme, the Scheme shall be acted upon only if the votes cast by the public shareholders of the Resulting Company in favour of the Scheme are more than the number of votes cast by the public shareholders against it. The term “Public” shall carry the same meaning as defined under Rule 2 of Securities Contracts (Regulations) Rules, 1957

• such other sanctions and approvals as may be required by law in respect of this Scheme being obtained; and

• the Certified copies of the NCLT Order referred to in this Scheme being filed with the Registrar of Companies, Punjab and Chandigarh by the Demerged Company and the Resulting Company.

P. DIVIDENDS

• The Demerged Company and the Resulting Company shall be entitled to declare and pay dividends in normal course, whether interim or final, to their respective shareholders in respect of the accounting period prior to the Effective Date, as applicable.

• The Equity shares of the Resulting Company to be issued and allotted to the Equity shareholders of the Demerged Company as provided in Clause 16 of the Scheme shall be entitled to dividends from the date of allotment.

• The holders of the shares of the Demerged Company and the Resulting Company shall, save as expressly provided otherwise in this Scheme, continue to enjoy their existing rights under their respective articles of association including the right to receive dividends.

• It is clarified that the aforesaid provisions in respect of declaration of dividends are enabling provisions only and shall not be deemed to confer any right on any member of the Demerged Company and/or the Resulting Company to demand or claim any dividends which, subject to the provisions of the said Act, shall be entirely at the discretion of the boards of directors of the Demerged Company and the Resulting Company respectively, and subject to the approval, if required, of the shareholders of the Demerged Company and the Resulting Company respectively.

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• Q. The Demerged Company and the Resulting Company may, after the Scheme becomes effective, for the sake of good order, execute amended and restated arrangements or confirmations or other writings if required for the ease of the Demerged Company, the Resulting Company and the counter party concerned in relation to the remaining business and / or the Demerged Undertaking, without any obligations to do so and without modification of any commercial terms or provisions in relation thereto.

R. Application To National Company Law Tribunal

• The Demerged Company and the Resulting Company shall make necessary applications / petitions before the National Company Law Tribunal, Chandigarh Bench, Chandigarh for the sanction of this Scheme under Sections 230 to 232 and other applicable provisions of the Act.

• The Resulting Company shall be entitled, pending the sanction of the Scheme, to apply to any Governmental Authority and all agencies, departments and Appropriate Authorities concerned as are necessary under any law, for such consents, approvals and sanctions which the Resulting Company may require to own and operate the Demerged Undertaking.

S. Saving Concluded Transactions

The transfer and vesting of the assets, liabilities and obligations of the Demerged Undertaking shall not in any manner affect any transaction or proceedings, contracts and deeds already concluded by the Demerged Company (in respect of Demerged Undertaking) on or before the Appointed Date and after the Appointed Date till the Effective Date, to the end and intent that the Resulting Company accepts and adopts all such acts, deeds and things done and executed by and / or on behalf of the Demerged Company as acts, deeds and things done and executed by and on behalf of the Resulting Company.

T. Treatment Of The Scheme For The Purposes Of It Act

The Scheme has been drawn up to comply with the conditions relating to “Demerger” as specified under Section 2(19AA) of the IT Act. If any of the terms or provisions of the Scheme are found or interpreted to be inconsistent with the provisions of the said section at a later date including resulting from an amendment of Applicable Law or for any other reason whatsoever, the provisions of the said section shall prevail and the Scheme shall stand modified to the extent necessary to comply with the Section 2(19AA) of the IT Act. Such modification will however not affect other parts of the Scheme. The power to make such modifications / amendments as may become necessary, shall vest with the Board of Directors of the Demerged Company and Resulting Company which can exercise the power at any time and shall be exercised in the best interest of the Demerged company and the Resulting Company.

• The Demerged Company and the Resulting Company through their Board of Directors may consent on behalf of all persons concerned to any modifications or amendments of this Scheme or to any conditions which the SEBI/ Hon’ble NCLT and/or any other authorities under law may deem fit to approve of or impose or which may otherwise be considered necessary or desirable for settling any question or doubt or difficulty that may arise for carrying out the Scheme and do all acts, deeds and things as may be necessary, desirable or expedient for putting this Scheme into

• However, no modifications and / or amendments to the Scheme can be carried out or effected by the Board of Directors without approval of the SEBI / NCLT or any other Authorities and the same shall be subject to powers of the respective authorities.

• For the purpose of giving effect to this Scheme or to any modifications thereof, the Directors of the Demerged Company and the Resulting Company are authorized to give such directions and/or to take such steps as may be necessary or desirable including any directions for settling any question or doubt or difficulty whatsoever that may arise.

• The Demerged Company and Resulting Company shall take such other steps as may be necessary or expedient to give full and formal effect to the provisions of this Scheme.

V. Severability

If any provision of this Scheme is found to be unworkable for any reason whatsoever, the same shall not, subject to the mutual agreement of the Demerged Company and the Resulting Company in writing, affect the validity or implementation of the other provisions of this Scheme. If any provision of this Scheme hereof is invalid, ruled illegal by any court or tribunal of competent jurisdiction or unenforceable under present or future Applicable Laws, then it is the

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intention of the Parties that such provision shall be severable from the remainder of the Scheme, and the Scheme shall not be affected thereby, unless the deletion of such provision shall cause this Scheme to become materially adverse to any Party, in which case the Parties shall attempt to bring about a modification in the Scheme, as will best preserve for such Parties the benefits and obligations of the Scheme, including but not limited to such provision.

W. Effect Of Non-Receipt Of Approvals

• In the event of any of the said sanctions and approvals not being obtained and/or the Scheme not being sanctioned by the Tribunal, and/or the order or orders not being passed as aforesaid on or before 15 (fifteen) months from the date of approvals of the Scheme by respective Boards of the Parties or within such extended period as may be mutually agreed upon between the Demerged Company and the Resulting Company through their respective Boards or their authorized representatives, this Scheme shall become null and void and each party shall bear and pay its respective costs, charges and expenses for and/ or in connection with this Scheme.

• In the event of revocation/withdrawal of the Scheme, no rights and liabilities whatsoever shall accrue to or be incurred inter se the Demerged Company and the Resulting Company or their respective shareholders or creditors or employees or any other person, save and except in respect of any act or deed done prior thereto as is contemplated hereunder or as to any right, liability or obligation which has arisen or accrued pursuant thereto and which shall be governed and be preserved or worked out as is specifically provided in the Scheme or in accordance with the Applicable Law and in such case, each party shall bear its owns costs, unless otherwise mutually agreed.

X. Revocation Of Scheme

• The Demerged Company and the Resulting Company acting jointly through their respective Boards shall each be at liberty to withdraw from this Scheme prior to the effective date at any time and the same shall not be construed as any non-compliance of the Act,

• The Demerged Company and/or Resulting Company acting through their respective Boards shall each be at liberty to withdraw from this Scheme in case the Demerged Company or the Resulting Company is declared insolvent.

• In the event any of the conditions are imposed by the SEBI/ Hon’ble NCLT or any authorities, which the Board of Directors of the Demerged Company and the Resulting Company find unacceptable for any reason, the Demerged Company and the Resulting Company shall be at liberty to withdraw this Scheme.

Y. Mutation Of Property

Upon the Scheme coming into effect and with effect from the Appointed Date, the title to the immovable properties, of the Demerged Undertakings shall be deemed to have been mutated and recognized as that of the Resulting Company and the mere filing of the certified true copy of the vesting order of the Tribunal sanctioning the Scheme with the appropriate Registrar or Sub-registrar of Assurances or with the relevant Government agencies shall suffice as record of continuing title of the immovable properties of the Demerged Undertakings with the Resulting Company pursuant to the Scheme becoming effective and shall constitute a deemed mutation and substitution thereof.

Z. Sequence Of Coming Into Effects Of This Scheme

On the sanction of the Scheme and upon the Scheme becoming effective, the following shall be deemed to become effective and operative in the sequence and order mentioned hereunder.

• Demerger of the Demerged Undertaking from Demerged Company to Resulting Company

• Issue and allotment of Equity shares by the Resulting Company to the shareholders of the Demerged Company in consideration of Demerger as aforesaid.

AA. Costs

Upon the sanction of this Scheme by the NCLT all costs, charges, taxes (including but not limited to stamp duty, registration charges, etc.) levies and all other expenses if any ( save as expressly otherwise agreed) on any deed, documents, instruments or Hon’ble NCLT Order arising out of and in carrying out and implementing this scheme and matters incidental to the completion of arrangement in relation to the Demerger shall be borne and paid by the Demerged Company and Resulting Company as mutually agreed upon.

BB. Miscellaneous

The Scheme does not contain or provide for any compromise with the Creditors of the Demerged Company and the Resulting Company. Further, the Scheme has not been drawn to accommodate any corporate debt restructuring. The

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Scheme also does not come under the purview of the Competition Commission of India.

You are requested to read the entire text of the Scheme to get fully acquainted with the provisions thereof. The aforesaid are only some of the salient extracts thereof.

Other matters

1. Summary of the Valuation Report including the basis of valuation is enclosed as Annexure 8 .

2. Under the Scheme, an arrangement is sought to be entered into between PAIL and its equity shareholders (Promoter shareholders and non- Promoter shareholders). Upon the effectiveness of the Scheme, PAIL shall allot equity shares, based on the share entitlement ratio and in the manner stipulated in clause 16 of the Scheme, to the equity shareholders of PIL.

As far as the Equity shareholders of PAIL are concerned (promoter shareholders as well as non-Promoter shareholders), there will be dilution in their shareholding.

In respect of the Scheme, there is no arrangement with the creditors, either secured or unsecured of PAIL. No compromise is offered under the Scheme to any of the creditors of PAIL. The liability of the creditors of PAIL, under the Scheme, is neither being reduced nor being extinguished.

As on date, PAIL has no outstanding towards any public deposits and therefore, the effect of the Scheme on any such public deposit holders does not arise. As on date, PAIL has not issued any debentures. In the circumstances, the effect of the Scheme on the debenture trustee does not arise.

Under the Scheme, no rights of the Employees of PAIL are being affected. The services of the Employees of PAIL, under the Scheme, shall continue on the same terms and conditions on which they were engaged by PAIL. Under clause 8 of the Scheme, on and from the effective date PAIL undertakes to engage the employees of PIL, engaged in or in relation to the Demerged Undertaking, on the same terms and conditions on which they are engaged by PIL without any interruption of service and in the same manner provided in clause 8 of the Scheme. In the circumstances, the rights of the employees of PIL engaged in or in relation to the Demerged Undertaking, would in no way be affected by the Scheme.

There is no effect of the Scheme on the key managerial personnel and/or the Directors of PAIL. Further no change in the Board of Directors of the company is envisaged on account of the Scheme.

Further, none of the Directors, the Key Managerial Personnel (as defined under the Act and rules framed thereunder) of PAIL and their respective relatives (as defined under the Act and rules framed thereunder) have any interest in the Scheme except to the extent of the equity shares held by them in PAIL and/or to the extent that the said Director(s) are common director(s) of the Companies and/or to the extent the said Director(s) are holding shares in PIL and/or to the extent that the said Director(s), Key Managerial Personnel and their respective relatives are the directors, members of the companies that hold shares in the respective Companies. Save as aforesaid, none of the said Directors or the Key Managerial Personnel has any material interest in the Scheme. The shareholding of the Company Secretary and Chief financial Officer of the Company and their respective relatives is less than 2% of the paid-up share capital of each of the Companies.

1. Under the Scheme, an arrangement is sought to be entered into between PIL and its equity shareholders (Promoter shareholders and non-Promoter shareholders). Upon the effectiveness of the Scheme, PAIL shall allot equity shares, based on the share entitlement ratio and in the manner stipulated in clause 16 of the Scheme, to the equity shareholders of PIL.

In respect of the Scheme, there is no arrangement with the creditors, either secured or unsecured of PIL. No compromise is offered under the Scheme to any of the creditors of PIL. The liability of the creditors of PIL, under the Scheme, is neither being reduced nor being extinguished.

As on date, PIL has no outstanding towards any public deposits and therefore, the effect of the Scheme on any such public deposit holders does not arise. As on date, PIL has not issued any debentures. In the circumstances, the effect of the Scheme on the debenture trustee does not arise.

Under Clause 8 of the Scheme, on and from the Effective Date, PAIL undertakes to engage the Employees of PIL, engaged in or in relation to the Demerged Undertaking, on the same terms and conditions on which they are engaged by PIL without any interruption of service and in the manner provided under Clause 8of the Scheme.

In the circumstances, the rights of the Employees of PIL would in no way be affected by the Scheme.

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There is no effect of the Scheme on the key managerial personnel and/or the Directors of PIL.

Further no change in the Board of Directors of the company is envisaged on account of the Scheme.

Further, none of the Directors, the Key Managerial Personnel (as defined under the Act and rules framed there under) of PIL and their respective relatives (as defined under the Act and rules framed there under) have any interest in the Scheme except to the extent of the equity shares held by them in PAIL and/or to the extent that the said Director(s) are common director(s) of the Companies and/or to the extent the said Director(s) are holding shares in PIL and/or to the extent that the said Director(s), Key Managerial Personnel and their respective relatives are the directors, members of the companies that hold shares in the respective Companies. Save as aforesaid, none of the said Directors or the Key Managerial Personnel has any material interest in the Scheme.

1. The Scheme does not involve any capital or debt restructuring and therefore the requirement to disclose details of capital or debt restructuring is not applicable.

2. In compliance with the provisions of Section 232(2)(c) of the Act, the Board of Directors of PAIL and PIL have in their separate meetings held on 14thday of August, 2021 and 14th day of August, 2021 respectively, have adopted a report, inter alia, explaining effect of the Scheme on each class of shareholders, key managerial personnel, promoters and non-promoter shareholders amongst others. Copy of the Reports adopted by the respective Board of Directors of PAIL and PIL are enclosed as Annexure 9 and Annexure 10 respectively.

3. No investigation proceedings have been instituted or are pending in relation to the Companies under Sections 210 to 229 of Chapter XIV of the Act or under the corresponding provisions of the Act of 1956. Further, no proceedings are pending under the Act or under the corresponding provisions of the Act of 1956 against any of the Companies.

4. To the knowledge of the Companies, no winding up proceedings have been filed or are pending against them under the Act or the corresponding provisions of the Act of 1956.

5. The copy of the proposed Scheme has been filed by the respective Companies before the concerned Registrar of Companies, Chandigarh.

   • st

6. The extract of audited Accounting Statement of PAIL and PIL for the year ended 31 March, 2022 are enclosed as Annexure 11 and Annexure 12 , respectively.

7. The accounting treatment as proposed in the Scheme is in conformity with the accounting standards prescribed under Section 133 of the Act. The certificates issued by the respective Statutory Auditors of the Companies are enclosed as Annexure 13 and Annexure 14 .

8. st

9. As per the books of accounts (as on 31 March, 2022) of PAIL and PIL, the amount due to the secured creditors is Rs. 58.14 crores and Rs.27.83 crores respectively.

10. st

11. As per the books of accounts (as on 31 March, 2022) of PAIL and PIL, the amount due to the unsecured creditors is Rs.37.49 crores and Rs. 64.77 crores respectively.

12. The name and addresses of the Promoters of Pritika Auto Industries Limited including their shareholding in the Companies as on 22nd July, 2022 are as under:

Sr. No. Name and address of Promoters and Promoter Group	PAIL	PAIL	PIL	PIL
	No. of Shares of Rs.2/- each	%	No. of Shares of Rs.10/- each	%
PROMOTERS
1. Mr. Raminder Singh Nibber House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059	59,20,002	6.68	21,21,214	21.61
House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059 2. Mr. Harpreet Singh Nibber	1,02,74,670	11.59	75,01,136	76.42
S.A.S. Nagar, Mohali, Punjab 160059 House No. 1021, Phase-IV, 3. Mr. Gurkaran Singh Nibber	11,55,790	1.30	1,88,875	1.92

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Sr. No. Name and address of Promoters and Promoter Group	Sr. No. Name and address of Promoters and Promoter Group	PAIL	PAIL	PIL	PIL
		No. of Shares of Rs.2/- each	%	No. of Shares of Rs.10/- each	%
PROMOTERS
4.	House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059 Mrs. Rishi Mangat	2,21,165	0.25	0	0
5.	S.A.S. Nagar, Mohali, Punjab 160059 House No. 1021, Phase-IV, Ms. Pavit Nibber	2,28,320	0.26	1,395	0.01
6.	S.A.S. Nagar Mohali, Punjab 160055 Pritika Industries Limited Plot No. C-94, Phase-VII, Industrial Focal Point,	2,48,74,208	28.05	0	0

nd

1. The name and addresses of the Promoters of PIL including their shareholding in the Companies as on 22 July, 2022 are as under:

are as under:	are as under:
Sr. No. Name and address of Promoters and Promoter Group		PAIL		PIL
		No. of Shares of Rs.2/- each	%	No. of Shares of Rs.10/- each	%
PROMOTERS
1.	House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059 Mr. Raminder Singh Nibber	59,20,002	6.68	21,21,214	21.61
2.	Mr. Harpreet Singh Nibber House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059	1,02,74,670	11.59	75,01,136	76.42
3.	House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059 Mr. Gurkaran Singh Nibber	11,55,790	1.30	1,88,875	1.92
4.	Ms. Pavit Nibber House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059	2,28,320	0.26	1,395	0.01

nd

46. The details of the Directors of PAIL as on 22 July,2022 are as follows:

Sr. no.	Name of Director	Address	DIN
1	Mr. Harpreet Singh Nibber	House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059	00239042
2	Mr. Raminder Singh Nibber	House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059	00239117
3	Mr. Subramaniyam Bala	H. No. 430, Sector 9, Panchkula, Haryana, 134113	00461697
4	Mr. Ajay Kumar	H. No. 252, Sector 80 S.A.S. Nagar, Mohali, 140308	02929113
5	Mrs. Neha	H. No. 04, Nehra Farm House, Kansal Enclave Road, Village Khuda Alisher, Chandigarh, 160011	08109734
6	Mr. Yudhisthir Lal Madan	Flat 1101, Tower 10, Vipul Belmonte, Sector 53, Golf Course Road, Gurgaon-122002	05123237

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nd

47. The details of the Directors of PIL as on 22 July, 2022 are as follows:

Sr. no.	Name of Director	Address	DIN
1	Mr. Harpreet Singh Nibber	House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059	00239042
2	Mr. Raminder Singh Nibber	House No. 1021, Phase-IV, S.A.S. Nagar, Mohali, Punjab 160059	00239117
3	Mr. Subramaniyam Bala	H. No. 430, Sector 9, Panchkula, Haryana, 134113	00461697
4	Mr. Ajay Kumar	H. No. 252, Sector 80 S.A.S. Nagar, Mohali, 140308	02929113
5	Mrs. Neha	H. No. 04, Nehra Farm House, Kansal Enclave Road, Village Khuda Alisher, Chandigarh, 160011	08109734

1. The details of the shareholding of the Directors and the Key Managerial Personnel of PAIL in PAIL and PIL as on 22nd July, 2022 are as follows:

nd 22 July, 2022 are as follows:
Name of Director and KMP	Position	Equity Shares held in PAIL	Equity shares in PIL
Mr. Harpreet Singh Nibber	Managing Director	1,02,74,670	75,01,136
Mr. Raminder Singh Nibber	Whole Time Director	59,20,002	21,21,214
Mr. Subramaniyam Bala	Independent Director	0	0
Mr. Ajay Kumar	Whole Time Director	9,850	1,375
Mrs. Neha	Independent Director	0	0
Mr. Yudhisthir Lal Madan	Independent Director	0	0
Mr. Narinder Kumar Tyagi	Chief Financial Ofcer	38,941	0
Mr. Chander Bhan Gupta	Company Secretary	0	0

nd

1. The details of the shareholding of the Directors and the Key Managerial Personnel of PIL in PIL and PAIL as on 22 July, 2022 are as follows:

2022 are as follows:
Name of Director and KMP	Position	Equity Shares held in PIL	Equity shares in PAIL
Mr. Harpreet Singh Nibber	Director	75,01,136	1,02,74,670
Mr. Raminder Singh Nibber	Managing Director	21,21,214	59,20,002
Mr. Subramaniyam Bala	Independent Director	0	0
Mr. Ajay Kumar	Director	1,375	9,850
Mrs. Neha	Independent Director	0	0
Ms. Manmeet Kaur Sihota	Company Secretary	0	11,055

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1. The Pre-Arrangement shareholding pattern of PIL as on 22nd July, 2022 and the Pre- and Post- Arrangement (expected) shareholding pattern of PAIL are as under:

Pre-Arrangement shareholding pattern of PIL as on 22nd July, 2022:

Sr. NO	Category	equity shares held No. of fully paid-up	of total no. of shares Shareholding as a %
(A)	Promoter and Promoter Group
(1)	Indian
(a)	Individuals/Hindu undivided family	98,12,620	99.97
(b)	Body Corporate	0	0
	Sub-Total (A)(1)	98,12,620	99.97
(2)	Foreign
(a)	Body Corporate (through GDRs)	0	0
	Sub-Total (A)(2)	0	0
	Total Shareholding of Promoter and Promoter Group (A)= (A)(1) + (A)(2)	98,12,620	99.97
(B)	Public Shareholding
(1)	Institutions	0	0
(a)	Mutual Funds	0	0
(b)	Foreign Portfolio Investors	0	0
(c)	Financial Institutions/ Banks	0	0
(d)	Insurance Companies	0	0
	Sub Total (B) (1)	0	0
(2)	Central Government/State Government(s)/ President of India	0	0
	Sub Total (B)(2)	0	0
(3)	Non-Institutions
(a)	i. Individual shareholders holding nominal share capital up to Rs.2 lakhs	3,280	0.03
	ii. Individual shareholders holding nominal share capital in excess of Rs. 2 lakhs	0	0
(b)	NBFCs Registered with RBI	0	0
(c)	Overseas Depositories (Holding GDRs)	0	0
(d)	Any Other
	Trusts	0	0
	Overseas Corporate Bodies	0	0
	Non Resident Indians	0	0
	Clearing Members	0	0
	Firms	0	0
	HUF	0	0
	Trusts	0	0
	Bodies Corporate	0	0
	Sub Total (B)(3)	3,280	0.03
	Total Public Shareholding (B)= (B)(1) + (B)(2) + (B)(3)	3,280	0.03
	Total Shareholding (A+B)	98,15,900	100

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nd

Pre-Arrangement shareholding pattern of PAIL as on 22 day of July, 2022:

Sr. NO	Category	equity shares held No. of fully paid-up	of total no. of shares Shareholding as a %
(A)	Promoter and Promoter Group
(1)	Indian
(a)	Individuals/Hindu undivided family	1,77,99,947	20.07
(b)	Body Corporate	2,48,74,208	28.05
	Sub-Total (A)(1)	4,26,74,155	48.13
(2)	Foreign
(a)	Body Corporate (through GDRs)	0	0
	Sub-Total (A)(2)	0	0
	Total Shareholding of Promoter and Promoter Group (A)= (A)(1) + (A)(2)	4,26,74,155	48.13
(B)	Public Shareholding
(1)	Institutions	0	0
(a)	Mutual Funds	0	0
(b)	Foreign Portfolio Investors	97,73,021	11.02
(c)	Financial Institutions/ Banks	0	0
(d)	Insurance Companies	0	0
(e)	Foreign Institutional Investors ( FII’s)	0	0
	Sub Total (B) (1)	97,73,021	11.02
(2)	Central Government/State Government(s)/ President of India	0	0
	Sub Total (B)(2)	0	0
(3)	Non-Institutions
(a)	i. Individual shareholders holding nominal share capital up to Rs.2 lakhs	1,67,60,794	18.90
	ii. Individual shareholders holding nominal share capital in excess of Rs. 2 lakhs	84,28,673	9.51
(b)	NBFCs Registered with RBI	0	0
(c)	Overseas Depositories (Holding GDRs)	0	0
(d)	Any Other
	Overseas Corporate Bodies	0	0
	Non-Resident Indians	87,42,380	9.86
	Clearing Members	1,94,927	0.22
	Bodies Corporate	13,29,142	1.50
	Firms	98,951	0.11
	HUF	6,15,514	0.69
	Trusts	54,943	0.06
	Sub Total (B)(3)	3,62,25,324	40.85
	Total Public Shareholding (B)= (B)(1) + (B)(2) + (B)(3)	45998345	51.87
	Total Shareholding (A+B)	8,86,72,500	100.00

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nd

Post Arrangement (expected) shareholding pattern of PAIL as on 22 day of July, 2022:

Sr. NO	Category	No. of fully paid-up equity shares held	Shareholding as a % of total no. of shares
(A)	Promoter and Promoter Group
(1)	Indian
(a)	Individuals/Hindu undivided family	7,96,19,451	52.90
(b)	Body Corporate	2,48,74,208	16.53
	Sub-Total (A)(1)	10,44,93,659	69.43
(2)	Foreign
(a)	Body Corporate (through GDRs)	0	0
	Sub-Total (A)(2)	0	0
	Total Shareholding of Promoter and Promoter Group (A)= (A)(1) + (A)(2)	10,44,93,659	69.43
(B)	Public Shareholding
(1)	Institutions	0	0
(a)	Mutual Funds	0	0
(b)	Foreign Portfolio Investors	97,73,021	6.49
(c)	Financial Institutions/ Banks	0	0
(d)	Insurance Companies	0	0
(e)	Foreign Institutional Investors ( FII’s)	0	0
	Sub Total (B) (1)	97,73,021	6.49
(2)	Central Government/State Government(s)/ President of India	0	0
	Sub Total (B)(2)	0	0
(3)	Non-Institutions
(a)	i. Individual shareholders holding nominal share capital up to Rs.2 lakhs	1,67,81,457	11.15
	ii. Individual shareholders holding nominal share capital in excess of Rs. 2 lakhs	84,28,673	5.60
(b)	NBFCs Registered with RBI	0	0
(c)	Overseas Depositories (Holding GDRs)	0	0
(d)	Any Other
	Overseas Corporate Bodies	0	0
	Non-Resident Indians	87,42,380	5.81
	Clearing Members	1,94,927	0.13
	Bodies Corporate	13,29,142	0.88
	Firms	98,951	0.06
	HUF	6,15,514	0.41
	Trusts	54,943	0.04
	Sub Total (B)(3)	3,62,45,987	24.08
	Total Public Shareholding (B)= (B)(1) + (B)(2) + (B)(3)	4,60,19,008	30.57
	Total Shareholding (A+B)	15,05,12,667	100.00

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1. The pre arrangement capital structure of PIL will be as follows (assuming the continuing capital Structure as on 22nd July, 2022):

PRE-ARRANGEMENT

PRE-ARRANGEMENT
PARTICULARS	AMOUNT IN RS.
AUTHORISED SHARE CAPITAL:
1,10,00,000 EquityShares of Rs.10/- each	11,00,00,000
TOTAL	11,00,00,000
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL:
98,15,900 EquityShares of Rs.10/- each	9,81,59,000
TOTAL	9,81,59,000

1. The pre and post-Arrangement (expected) capital structure of PAIL will be as follows (assuming the continuing capital Structure as on 22nd July, 2022):

PRE-ARRANGEMENT

PRE-ARRANGEMENT
PARTICULARS	AMOUNT IN RS.
AUTHORISED SHARE CAPITAL
18,25,00,000 EquityShares of Rs. 2/- each	36,50,00,000
TOTAL	36,50,00,000
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL
8,86,72,500 EquityShares of Rs. 2/- each	17,73,45,000
TOTAL	17,73,45,000

POST ARRANGEMENT (EXPECTED)

POST ARRANGEMENT (EXPECTED)
PARTICULARS	AMOUNT IN RS.
AUTHORISED SHARE CAPITAL
18,25,00,000 EquityShares of Rs. 2/- each	36,50,00,000
TOTAL	36,50,00,000
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL:
15,05,12,667 EquityShares of Rs. 2/- each	30,10,25,334
TOTAL	30,10,25,334

1. In the event that the Scheme is withdrawn in accordance with its terms, the Scheme shall stand revoked, cancelled

2. Electronic copy of following documents will be available for inspection in the “Investors” section of the website of the Company: www.Pritikaautoindustries.comtill the date of the meeting:

3. (i) Copy of the final order passed by NCLT in Joint Company Application CA(CAA) No.16/Chd/Pb/ 2022dated 29thday of June, 2022as rectified vide order dated 8th day of July, 2022 in Supplementary Item No.2 CA No. 157 /2022 directing PAIL to, inter alia, convene the meeting of its equity shareholders, Secured Creditors and Unsecured Creditors.

4. (ii) Copy of the final order passed by NCLT in Joint Company Application CA(CAA) No.16/Chd/Pb/ 2022 dated 29th day of June, 2022 as rectified vide order dated 8th day of July, 2022 in Supplementary Item No.2 CA No. 157 /2022directing PIL to, inter alia, to dispense the meeting of its equity shareholders and Unsecured Creditors and convene the meeting of Secured Creditors.

5. (iii) Copy of the Memorandum and Articles of Association of PAIL and PIL respectively;

6. (iv) Copy of the annual reports of PAIL and PIL for the financial years ended 31st March 2020 and 31st March 2021and Audited Financial Statements for the year ended on 31st March, 2022;

7. (v) Copy of Valuation report dated 14thday of August, 2021submitted by M/s. Payal Gada Chartered Accountants and Registered Valuer

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• (vi) Copy of the Fairness Opinion, dated 14thday of August, 2021 issued by Systematix Corporate Services Limited to the Board of Directors of PAIL

• (vii) Copy of the Audit Committee Report, dated 14th day of August, 2021 of PAIL and PIL

• (viii) Copy of the Statutory Auditors' certificate on Accounting Treatment dated 14th day of August, 2021 issued by M/s. Sunil Kumar Gupta & Co. Chartered Accountants to PAIL

• (ix) Copy of the Statutory Auditors' certificate on accounting treatment dated 14thday of August, 2021 issued by M/s. A. K. Sood & Associates Chartered Accountants to PIL

• (x) Copy of the complaints report, dated 8thday of November, 2021 and 15thday of November, 2021 submitted by PAIL to BSE and NSE;

• (xi) Copy of the no adverse observation / objection letter issued by BSE and NSE, dated14thday of January, 2022 and 14th day of January, 2022 respectively, to PAIL

• (xii) Summary of the Valuation Report including the basis of valuation;

• (xiii) Copy of Form No. GNL-1 filed by the respective Companies with the concerned Registrar of Companies Chandigarh along with challan evidencing filing of the Scheme;

• (xiv) Copy of the Scheme; and

• (xv) Copy of the Reports dated 14thday of August, 2021 and 14th day of August, 2021 adopted by the Board of Directors of PAIL and PIL respectively, pursuant to the provisions of section 232(2)(c) of the Act.

• This statement may be treated as an Explanatory Statement under Sections 230(3), 232(1) and (2) and 102 of the Act read with Rule 6 of the Rules. A copy of the Scheme, Explanatory Statement shall be furnished by Pritika Auto Industries Limited (PAIL) to its shareholders, free of charge, within one (1) day (except Saturdays, Sundays and public holidays) on a requisition being so made for the same by the shareholders of PAIL.

• After the Scheme is approved, by the equity shareholders of PAIL it will be subject to the approval/sanction by NCLT.

Sd/Harpreet Singh Nibber Managing Director

Dated this 1st day of August, 2022 Place : - Mohali

Registered office: Plot No. C-94, Phase –VII, Industrial Focal Point, S.A.S Nagar Mohali, Punjab – 160055 Tel. No: + +91 172-5008900 /5008901 CIN: L45208PB1980PLC046738 E-mail: compliance@pritikaautoindustries.com Website : www.pritikaautoindustries.com

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Annexure - 1

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SCHEME OF ARRANGEMENT UNDER SECTION 230 to 232 AND OTHER RELEVANT PROVISIONS OF THE COMPANIES ACT, 2013

BETWEEN

PRITIKA INDUSTRIES LIMITED (“PIL”)

... DEMERGED COMPANY

AND

PRITIKA AUTO INDUSTRIES LIMITED (“PAIL”)

... RESULTING COMPANY

AND

THEIR RESPECTIVE SHAREHOLDERS AND CREDITORS

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PREAMBLE

• A) This Scheme of Arrangement (herein after referred to as” Scheme”) has been propounded for demerger and vesting of the “Automotive/Tractor/Engineering Components Business Undertaking” (as defined hereinafter) of Pritika Industries Limited (PIL) (Demerged Company) as a going concern to Pritika Auto Industries Limited (PAIL) (Resulting Company) pursuant to Sections 230 to 232 read with other relevant provisions if any of the Companies Act, 2013 and rules made thereunder and also read with Section 2(19AA), Section 2(19AAA), Section 2(41A) and other applicable provisions of the Income Tax Act, 1961.

Further this Scheme also provides for various other matters consequential or otherwise integrally connected with.

After the effectiveness of this Scheme, the shares issued by the Resulting Company to the shareholders of the Demerged Company as consideration in terms of 16 of the Scheme shall be listed on the BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) in accordance with SEBI Circular No. circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 as amended from time to time.

B) BACKGROUND OF COMPANIES

I. PRITIKA INDUSTRIES LIMITED (PIL) (Demerged Company)

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The Company (PIL) was incorporated on 1 July, 1997 under the Companies Act, 1956 (No.1 of 1956) as “Pritika Industries Private Limited” and received the ‘Certificate of Incorporation’ bearing number 55-88273 of 1997-98 from the Registrar of Companies (“ ROC ”), NCT of Delhi & Haryana.

The name of the Company was changed from Pritika Industries Private Limited to Pritika Industries Limited and obtained a fresh certificate of incorporation consequent upon change of name on conversion to Public Limited Company dated 12th June, 2012 from the Registrar of Companies, National Capital Territory of Delhi and Haryana.

The Hon’ble Regional Director (NR) New Delhi, vide his order dated 26th November, 2013 has sanctioned a Petition for shifting of the Registered Office of the company from the State of Delhi to the State of Punjab. Accordingly, the company, upon registration of the said order, obtained a fresh certificate of incorporation from the Registrar of Companies, Punjab and Chandigarh.

The registered office of PIL is situated at Plot No. C-94, Phase VII, Industrial Focal Point, S.A.S. Nagar, Mohali, Punjab – 160 055.

The Corporate Identification (CIN) of the Demerged company is U85100PB1997PLC038216 and the Permanent Account Number (PAN) of the Demerged Company is AAACP9500B.

The Demerged Company has not changed its name and registered office address during the last five years except change in object clauses.

The Demerged Company (PIL) is engaged in various businesses including manufacturing of auto and tractor components and also carrying on the healthcare business including OPD services, diagnostic labs and investment in securities including shares, Mutual funds etc. and trading activity.

The shares of the demerged /company are not listed on any stock exchanges.

The Demerged Company holds 2,47,06,690 Equity Shares of Rs.2/- each constituting 27.86% of the total issued, subscribed and paid-up capital in the Resulting Company and the said shares shall continue to remain in the remaining business / retained undertaking of the Demerged Company and will not be cancelled.

II. PRITIKA AUTO INDUSTRIES LIMITED (PAIL) (Resulting Company)

The Company (PAIL) was initially incorporated on April 11, 1980 under the Companies Act, 1956 (No.1 of 1956) in the State of Maharashtra as “Hariganga Machineries and Engineering Services Limited” and received the ‘Certificate of Incorporation’ bearing number 22506 of 1980 from the Registrar of Companies (“ ROC ”), Maharashtra, Bombay.

The Company had also received Certificate for Commencement of Business from ROC, Maharashtra on 25th April, 1980. The CIN of the Company was L45208MH1980PLC022506.

The name of the Company changed from “Hariganga Machineries and Engineering Services Limited” to i.e. “Shivkrupa Machineries and Engineering Services Limited” on 5th August, 2015 and a fresh certificate of incorporation consequent on change of name was obtained from ROC, Maharashtra, Mumbai.

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The Equity Shareholders have passed a special resolution through Postal Ballot on 7th March, 2017 for change of name from “Shivkrupa Machineries and Engineering Services Limited” to its present name i.e. Pritika Auto Industries Limited and a fresh certificate of incorporation dated 16th March, 2017 consequent on change of name was obtained from ROC, Maharashtra, Mumbai.

The Hon’ble Regional Director (WR) Mumbai, vide his order dated 9th June, 2017 has sanctioned a Petition for shifting of the Registered Office of the company from the State of Maharashtra to the State of Punjab. Accordingly, the company, upon registration of the said order, obtained a fresh certificate of incorporation from the Registrar of Companies, Chandigarh.

The Corporate Identification (CIN) of the Resulting Company is L45208PB1980PLC046738 and the Permanent Account Number (PAN) of the Resulting Company is AAACH4698C.

The Resulting Company has changed its name and objects and shifted Registered Office from the State of Maharashtra to the State of Punjab during the last five years.

The Resulting Company (PAIL) is engaged in the business of manufacturing, buying, selling, assembling all types of metals, alloys, castings, automobile parts, tractor parts, and accessories including zigs and fixtures, bolts and nuts, or component’s part thereof.

The shares of the Resulting Company are listed on BSE Limited and National Stock Exchange of India Limited and Calcutta Stock Exchange Limited.

C) RATIONALE AND OBJECT OF THE SCHEME

The Demerged Company is engaged in various businesses and owns the following two business undertakings.

• Automotive/Tractor/Engineering Components Business undertaking

• Healthcare and investment business undertaking.

The Demerged company would demerge Automotive/Tractor/Engineering Components Business undertaking (hereinafter referred to as “Demerged Undertaking”) to the Resulting company and it would continue to run and operate the healthcare and investment business undertaking (hereinafter referred to as the “Remaining Business / Retained Undertaking”). The underlying business rationale and objectives are as follows.

• a) With the complete integration of the Demerged Undertaking with Resulting Company, the manufacturing and machining capacity of the Resulting Company will stand enhanced. Since, PIL fulfils its raw material supply (i.e., Raw Castings) needs from PAIL, the Demerger would eliminate the inter dependence and shall be a forward integration of manufacturing and machining activities of PAIL which in turn add to efficiency, economy in operations and ultimately add to shareholders wealth.

• b) PIL and PAIL are in the same line of business and cater the needs of same customers (i.e. OEMs). The Scheme of Arrangement would consolidate and synchronize the business structure and eliminate the unnecessary competition and conflict of interest within the group which will create transparency and confidence with the investors and the market.

• c) The Demerged Company currently has business interest in diverse businesses such as Manufacturing, Healthcare and Investment & Financing activities and other allied activities. With a view to achieve greater management focus in other business activities, Demerged Company proposes to demerge its business interest in the Demerged Undertaking and vest the same in the Resulting Company.

• d) The consolidation of operations of the Manufacturing Business of Demerged Company and the Resulting Company by merging the Demerged Undertaking into Resulting Company, will lead to a more efficient utilisation of capital, administrative and operational rationalization and promote organisational efficiencies. It will help achieve cost efficiency that will enhance the financial efficiencies and help achieve economies of scale, reduction in overheads and improvement in various other operating parameters.

• e) The Demerged undertaking and remaining undertaking have their own set of strengths and dynamics in the form of nature of risks, competition, challenges, opportunities and business methods leading to different growth potentials. Hence segregation of the two undertakings would enable a focused management to explore the potential business opportunities effectively and efficiently.

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• f) The demerger would result in achieving efficiency in operational process by designing and implementing independent strategies specifically designed for the two businesses and in optimising profitability. This would in turn enhance the shareholders wealth.

• g) Targeting and attracting new investors with specific focus and expertise in the two businesses thereby providing the necessary funding impetus to the long-term growth strategy of the two businesses.

• h) Integration would result in maximising overall shareholder value, improvising the competitive position and enabling to unlock the economic value of both the entities.

• i) Improved organisational capability and leadership, arising from the pooling of human capital who have the diverse skills, talent and vast experience to compete successfully in an increasingly competitive industry.

• j) Cost savings are expected to flow from more focused operational efforts, rationalization, standardisation and simplification of business processes, and the elimination of duplication, and rationalization of administrative expenses.

In view of the aforesaid, the Board of Directors of the Demerged Company and the Resulting Company have considered it desirable and expedient to demerge the Demerged Undertaking of the Demerged Company and vest the same with the Resulting Company, in order to benefit the stakeholders of both the companies.

Accordingly, the Board of Directors of the Demerged Company and the Resulting Company have formulated this Scheme of Arrangement for the transfer and vesting of the Demerged Undertaking with and into the Resulting Company pursuant to the provisions of Section 230 to Section 232 and other relevant provisions of the Act.

D) PARTS OF THE SCHEME

This Scheme of Arrangement is divided into the following parts

• (a) Part I deals with the definitions and share capital;

• (b) Part II deals with Demerger of ‘Automotive/Tractor/Engineering Components Business Undertaking’ of PIL;

• (c) Part III deals with the general terms and conditions applicable to this Scheme.

PART 1

DEFINITIONS AND SHARE CAPITAL

1. DEFINITIONS

• In this Scheme (as defined hereunder), unless inconsistent with the subject or context, the following expressions shall have the following meaning:

• 1.1 “Act” or “The Act” means the Companies Act, 2013 or any statutory modification or re-enactment thereof for the time being in force.

• 1.2 “Accounting Standards” means the applicable accounting standards in force in India from time to time, consistently applied during the relevant period, including the generally accepted accounting principles and standards, Indian Accounting Standards (“Ind -AS”) and all pronouncements including the guidance notes and other authoritative statements of the Institute of Chartered Accountants of India and / or the National Financial Reporting Authority.

• 1.3 “Appropriate Authority” means any national, state, provincial, local or similar governmental, statutory, regulatory, administrative authority, agency, commission, departmental or public body or authority, board, branch, tribunal or court or other entity authorized to make laws, rules, regulations, standards, requirements, procedures or to pass directions or orders in each case having the force of law, or any non-governmental regulatory or administrative authority, body or other organization to the extent that the rules, regulations and standards , requirements, procedures or orders of such authority, body or other organization have the force of law, including the Registrar of Companies, Regional director, Hon’ble NCLT, Securities and Exchange Board of India, stock Exchanges and such other regulations or authorities as may be applicable.

• 1.4 “Applicable Law” means (a) all applicable statutes, enactments, acts of legislature or parliament, laws, ordinances, rules, bye-laws, regulations, listing agreements, notifications, guidelines or policies of any applicable country and/ or jurisdiction; (b) writ, injunction, directions, directives, judgment, arbitral award, decree, orders or approvals of, or agreements with, any Governmental Authority or recognized stock exchange.

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• 1.5 “Appointed Date” would mean1st April, 2021 or such other date as may be fixed or approved by the National Company Law Tribunal, Chandigarh Bench, Chandigarh.

• 1.6 “Assets” shall mean and include without limitation, assets or properties of every kind, nature, character and description whether moveable, immoveable, tangible, intangible including mutual fund investment, patent and trademark, whether owned or leased or otherwise acquired or possessed.

• 1.7 “Board of Directors” or “Board” in relation to each of the Demerged Company and the Resulting Company, as the case may be, means the board of directors of such company, and shall include a committee duly constituted and authorized for the purposes of matters pertaining to the Demerger, the Scheme and/or any other matter relating thereto.

• 1.8 “BSE” means BSE Limited.

• 1.9 “CSE” means The Calcutta Stock Exchange Limited

• 1.10 “CIN” means Corporate Identity Number

• 1.11 “Demerged Company” means Pritika Industries Limited , a company incorporated under the Companies Act, 1956 and having its registered office at Plot No. C-94, Phase VII, Industrial Focal Point, S.A.S. Nagar, Mohali, Punjab – 160 055.

• 1.12 “Demerged Undertaking” means the ‘Automotive/Tractor/Engineering Components Business Undertaking’ of the Demerged Company, which shall include business, activities and operations pertaining to the ‘Automotive/Tractor/Engineering Components (hereinafter also referred to as ‘Automotive/Tractor/Engineering Components Business Undertaking’)of the Demerged Company on a going concern basis, and shall mean and include, without limitation:

All assets and properties of the ‘Automotive/Tractor/Engineering Components Business Undertaking’ including all assets whether situated in India or abroad, (whether movable or immovable), related liabilities pertaining thereto including contingent liabilities, liabilities not accrued, not recognized or not provided for in the books of accounts of the Demerged Company.

Without prejudice to the generality of the above, the Demerged Undertaking shall include in particular:

• i. all immovable properties i.e. land together with the buildings and structures standing thereon (whether freehold, leasehold, leave and licensed, right of way, tenancies or otherwise) including offices, structures, workshop, benefits of any rental agreement for use of premises, marketing offices, share of any joint assets, etc., which immovable properties are currently being used exclusively and solely for the purpose of and in relation to the ‘Automotive/Tractor/Engineering Components Business Undertaking’ and all documents (including panchnamas, declarations, receipts) of title, rights and easements in relation thereto and all rights, covenants, continuing rights, title and interest in connection with the said immovable properties;

• ii. all assets, as are movable in nature and exclusively and solely pertaining to and in relation to the ‘Automotive/Tractor/Engineering Components Business Undertaking’, whether present or future or contingent, tangible or intangible including goodwill, whether recorded in the books or not, in possession or reversion, including electrical fittings, furniture, fixtures, appliances, accessories, power lines, office equipments, computers, communication facilities, installations, tools, plants, vehicles, inventory and stock in trade, wherever lying, actionable claims, current assets, earnest monies and sundry debtors, financial assets, outstanding loans and advances recoverable in cash or in kind or for value to be received, provisions, receivables, funds, cash and bank balances and deposits including accrued interest thereto with Government, semi-Government, local and other authorities and bodies, banks, customers and other Persons, insurances, the benefits of any bank guarantees, performance guarantees and letters of credit;

• iii. all permits, licenses, permissions, approvals, clearances, consents, benefits, registrations, rights, entitlements, credits, certificates, awards, sanctions, allotments, quotas, no objection certificates, exemptions, concessions, subsidies, liberties and advantages including those relating to privileges, powers, facilities of every kind and description of whatsoever nature and the benefits thereto that pertain exclusively and solely to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• iv. all contracts, agreements, purchase orders/service orders, operation and maintenance contracts, memoranda of understanding, memoranda of undertakings, memoranda of agreements, memoranda of agreed points, minutes of meetings, bids, tenders, expression of interest, letter of intent, hire and purchase arrangements,

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lease/license agreements, tenancy rights, agreements/panchnamas for right of way, equipment purchase agreements, agreement with customers, purchase and other agreements with the supplier/manufacturer of goods/service providers, other arrangements, undertakings, deeds, bonds, schemes, insurance covers and claims, clearances and other instruments of whatsoever nature and description, whether written, oral or otherwise and all rights, title, interests, claims and benefits thereunder exclusively and solely pertaining to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• v. all applications (including hardware, software, licenses, source codes, and scripts), registrations, licenses, trade names, service marks, trademarks, copyrights, patents, domain names, designs, intellectual property rights (whether owned, licensed or otherwise, and whether registered or unregistered), trade secrets, research and studies, technical knowhow, confidential information and all such rights of whatsoever description and nature that in each case pertain exclusively and solely to the ‘Automotive/Tractor/Engineering Components Business Undertaking’ including, without limitation, the intellectual properties of the Demerged Company;

• vi. all rights to use and avail telephones, telexes, facsimile, email, internet, leased line connections and installations, utilities, electricity and other services, reserves, provisions, funds, benefits of assets or properties or other interests held in trusts, registrations, contracts, engagements, arrangements of all kind, privileges and all other rights, easements, liberties and advantages of whatsoever nature and wheresoever situated belonging to or in the ownership, power or possession and in control of or vested in or granted in favour of or enjoyed by the Demerged Company and exclusively and solely pertaining to or in connection with the ‘Automotive/Tractor/Engineering Components Business Undertaking’ and all other interests of whatsoever nature belonging to or in the ownership, power, possession or control of or vested in or granted in favour of or held for the benefit of or enjoyed by the Demerged Company and exclusively and solely pertaining to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• vii. all tax related assets, all the credits for taxes such as sales tax, MAT tax credit, service tax, CENVAT, GST, tax deduction at source, accumulated losses and unabsorbed depreciation as per books if any as well as per the IT Act enjoyed by the Demerged Company pertaining to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• viii. all books, records, files, papers, engineering and process information, software licenses (whether proprietary or otherwise), test reports, computer programmes, drawings, manuals, data, databases including databases for procurement, commercial and management, catalogues, quotations, sales and advertising materials, product registrations, dossiers, product master cards, lists of present and former customers and suppliers including service providers, other customer information, customer credit information, customer/supplier pricing information, and all other books and records, whether in physical or electronic form that pertain to the ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• ix. all debts, liabilities, duties, taxes and obligations of the Demerged Company pertaining to the ‘Automotive/Tractor/Engineering Components Business Undertaking’, namely:

• a. the debts of the Demerged Company which arises out of the activities or operations of the - ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• b. specific loans and borrowings raised, incurred and utilized for the activities or operations of or pertaining to ‘Automotive/Tractor/Engineering Components Business Undertaking’;

• c. general and multipurpose borrowings of the Demerged Company shall be allocated to ‘Automotive/Tractor/Engineering Components Business Undertaking’ in the same proportion which the value of the assets transferred under this Scheme bears to the total value of assets of Demerged Company immediately before the demerger;

• x. all liabilities (including contingent liabilities, liabilities not accrued, not recognized or provided for in the books of accounts of the Demerged Company), present liability as accounted in the books of the Demerged Company whether secured or unsecured, pertaining to the Demerged Undertaking;

• xi. all employees of the Demerged Company employed/engaged exclusively and solely in the ‘Automotive/Tractor/Engineering Components Business Undertaking’ as on the Effective Date; and

• xii. all legal or other proceedings of whatsoever nature relating to the ‘Automotive/Tractor/Engineering Components Business Undertaking’.

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( Note 1: - For the purposes of this Scheme, a statement of account of the ‘Automotive/Tractor/Engineering Components Business Undertaking’ of the Demerged Company is drawn up as on the Appointed Date which gives details of assets and liabilities of the Demerged undertaking.)

( Note 2: - In case of any question that may arise as to whether any particular asset or liability and/or employee pertains or does not pertain exclusively and solely to the ‘Automotive/Tractor/Engineering Components Business Undertaking’ or whether it arises out of the activities or operations of the ‘Automotive/Tractor/Engineering Components Business Undertaking’, the same shall be decided by mutual agreement between the Board of Directors of the Demerged Company and the Resulting Company.)

• 1.13 “Demerger” means the transfer by way of demerger of the Demerged Undertaking to the Resulting Company and the consequent issue of equity shares by the Resulting Company to the Shareholders of the Demerged Company as set out in this Scheme.

• 1.14 “Demerger Record Date” means in respect of demerger of ‘Automotive/Tractor/Engineering Components Business Undertaking’ of PIL, the date to be fixed by the Board of Directors of PIL in consultation with the Board of Directors of PAIL for the purpose of issue and allotment of shares by PAIL to the shareholders of PIL accordance with Clause Error! Reference source not found . of this Scheme.

• 1.15 “Effective Date” means the later of the dates on which the certified copies of the orders sanctioning this Scheme, passed by the National Company Law Tribunal or such other competent Authority, as may be applicable, are filed with the Registrar of Companies, at Punjab & Chandigarh by PIL and PAIL.

• 1.16 “Employees” mean all the permanent employees of the Demerged Company employed/engaged in the Demerged Undertaking as on the Effective Date.

• 1.17 “Encumbrance” means any options, pledge, mortgages, liens, securities, interests, claims, charges, pre-emptive rights, easement, limitation, attachment, restraint or any other encumbrance of any kind or nature whatsoever; and the term "Encumbered" shall be construed accordingly.

• 1.18 “Governmental Approvals” means any consent, approval, authorization, waiver, permit, permission, clearance, license, exemption, no objection certificate, registration, with, of or from any Governmental Authority .

• 1.19 “IT Act” means the Income-tax Act, 1961 and shall include any statutory modifications, re-enactments or amendments thereof for the time being in force.

• 1.20 “Liability(ies)” means liabilities of every kind, nature and description (including contingent liabilities, liabilities not accrued, not recognized or provided for in the books of accounts of the Demerged Company) and includes secured loan, unsecured loans, borrowings, statutory liabilities, contractual liabilities and guarantees

• 1.21 “NCLT” means the Hon’ble National Company Law Tribunal, Chandigarh Bench, Chandigarh having jurisdiction in relation to the Demerged Company and the Resulting Company or such other forum or authority as may be vested with any of the powers for approving any scheme of arrangement, compromise or reconstruction of a company under Sections 230 to 232 of the Act of the above-mentioned tribunal under the Act.

• 1.22 “NCLT Order” means all order(s) passed by the NCLT sanctioning the Scheme and includes any orders passed by NCLT or any other Governmental Authority’s order(s) for extension of time or condonation of delay in filing of the requisite forms with the Registrar of Companies in relation to this Scheme, if applicable.

• 1.23 “NSE” means National Stock Exchange of India Limited.

• 1.24 “Parties” shall mean collectively the Demerged Company and the Resulting Company, and “Party” shall mean each of them, individually.

• 1.25 “Person” means any individual or other entity, whether a corporation, firm, company, joint venture, trust, association, organization, partnership or proprietorship, including any governmental agency or regulatory body.

• 1.26 “Registrar of Companies” means the Registrar of Companies, Punjab & Chandigarh having jurisdiction over the Demerged Company and the Resulting Company.

• 1.27 “Remaining Business / Retained Undertaking” with respect to the Demerged Company means the business, employees, assets and liabilities of the Demerged Company other than comprised in the Demerged Undertaking.

• 1.28 “Resulting Company” means Pritika Auto Industries Limited, a Company incorporated under the Companies Act, 1956 and having its registered office at Plot No. C-94, Phase VII, Industrial Focal Point, S.A.S. Nagar, Mohali, Punjab

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– 160 055.’.

• 1.29 “Rupees” or “Rs.” or “INR” means the lawful currency of India

• 1.30 “Scheme” or “the Scheme” or “this Scheme” means this Scheme of Arrangement in its present form or with any modification(s) approved or imposed or directed by the NCLT or any other Governmental Authorities.

• 1.31 “SEBI” means the Securities and Exchange Board of India.

• 1.32 “SEBI Circular” means (i) circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017, (ii) circular No. CFD/DIL3/ CIR/2017/26 dated March 23, 2017, (iii) circular No. CFD/ DIL3/CIR/2017/105 dated September 21, 2017, (iv) circular No. CFD/DIL3/CIR/2018/2 dated January 3, 2018 issued by SEBI as amended (v) circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3 rd November, 2020 read with (vi) Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 issued by SEBI or any circulars issued by SEBI from time to time

• 1.33 “SEBI LODR Regulations” mean the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and any amendments thereof

• 1.34 “Stock Exchanges” means BSE Limited (“BSE”) , National Stock Exchange of India Limited (“NSE”) ;

• 1.35 “Tax ” or “Taxes” means and include any tax, whether direct or indirect, including income tax (including MAT Tax, Tax deducted at Source (TDS) withholding tax, dividend distribution tax), GST, excise duty, VAT, CST, service tax, octroi, local body tax and customs duty, duties, charges, fees, levies or other similar assessments by or payable to Governmental Authority, including in relation to (i) income, services, gross receipts, premium, immovable property, movable property, assets, profession, entry, capital gains, municipal, interest, expenditure, imports, wealth, gift, sales, use, transfer, licensing, withholding, employment, payroll and franchise taxes, and (ii) any interest, fines, penalties, assessments, or additions to Tax resulting from, attributable to or incurred in connection with any proceedings or late payments in respect thereof.

2. INTERPRETATION

• 2.1 In addition to the above terms, certain terms may be defined elsewhere in this Scheme and wherever such terms are used in this Scheme, they shall have the meaning so assigned to them.

• 2.2 All terms and words used but not defined in this Scheme shall, unless repugnant or contrary to the context or meaning thereof, have the same meaning ascribed to them under the Act and any other applicable laws, rules, regulations, bye-laws, as the case may be or any statutory modification or re-enactment thereof for the time being in force.

• 2.3 All references in this Scheme to statutory provisions shall be construed as meaning and including references to:

• 2.3.1 any statutory modification, consolidation or re-enactment made after the date of approval this Scheme by the Board of Directors of the Demerged Company and the Resulting Company and for the time being in force;

• 2.3.2 all subordinate legislation made from time to time under that provision (whether or not amended, modified, reenacted or consolidated);

• 2.3.3 all statutory instruments or orders made pursuant to a statutory provision;

• 2.3.4 any statutory provisions of which these statutory provisions are a consolidation, re-enactment or modification.

• 2.4 References to clauses, recitals and schedules, unless otherwise provided, are to clauses, recitals and schedules of and to this Scheme.

• 2.5 Headings, subheadings, titles, subtitles to clauses, sub-clauses, sections and paragraphs are for information only and shall not form part of the operative provisions of this Scheme or the schedules hereto and shall be ignored in construing the same.

• 2.6 References to clauses, and schedules are, unless the context otherwise requires, references to clauses, and schedules to this Scheme.

• 2.7 Reference to days, months and years are to calendar days, calendar months and calendar years, respectively.

• 2.8 Any reference to “writing” shall include printing, typing, lithography and other means of reproducing words in visible form.

• 2.9 The words “include” and “including” are to be construed without limitation.

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• 2.10 The singular shall include the plural and vice versa; and references to one gender include all genders.

• 2.11 Any phrase introduced by the terms including in particular or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms.

3. DATE OF TAKING EFFECT

The Scheme set out herein in its present form or with any modification(s) approved or imposed or directed by the NCLT or by any Governmental Authority shall be effective from the Appointed Date but shall be operative from the

4. SHARE CAPITAL

4.1 DEMERGED COMPANY:

The share capital of the Demerged Company as on March 31, 2021 is as follows:

PARTICULARS	AMOUNT IN RS.
AUTHORISED SHARE CAPITAL:
1,10,00,000 EquityShares of Rs.10/- each	11,00,00,000
TOTAL	11,00,00,000
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL:
98,15,900 EquityShares of Rs.10/- each	9,81,59,000
TOTAL	9,81,59,000

Subsequent to the above date and till the date of the Scheme being approved by the Board of Directors of the Demerged Company, there has been no change in the authorized, issued, subscribed and paid-up capital of the Demerged Company.

4.2 RESULTING COMPANY

The share capital of the Resulting Company as on March 31, 2021 is as follows:

PARTICULARS	AMOUNT IN RS.
AUTHORISED SHARE CAPITAL:
3,65,00,000 EquityShares of Rs. 10/- each	36,50,00,000
TOTAL 36,50,00,000
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL
1,77,34,500 EquityShares of Rs. 10/- each	17,73,45,000
TOTAL	17,73,45,000

The Equity Shareholders of the Company have passed an Ordinary Resolution for the sub-division of equity shares from the face value of Rs 10/- per share to Rs. 2/- per share i.e. sub division of one equity share of Rs. 10/- into five equity shares of Rs. 2/- each fully paid up and also passed an Ordinary Resolution for alteration of the Capital clause in the Memorandum of Association of the company i.e. changing the Authorized Share Capital of the Company from existing Rs 36,50,00,000/- divided into 3,65,00,000 Equity Shares of Rs 10/- each to Rs 36,50,00,000/- divided into 18,25,00,000 equity shares of Rs 2/- each.

Thus, the Present Authorised, issued, subscribed and paid-up capital of the Resulting Company is as under.

PARTICULARS	AMOUNT IN RS.
AUTHORISED SHARE CAPITAL
18,25,00,000 EquityShares of Rs. 2/- each	36,50,00,000
TOTAL	36,50,00,000
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL
8,86,72,500 EquityShares of Rs. 2/- each	17,73,45,000
TOTAL	17,73,45,000

Subsequent to the above date and change and till the date of the Scheme being approved by the Board of Directors of the Resulting Company, there has been no change in the authorized, issued, subscribed and paid-up capital of the Resulting Company.

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PART II – DEMERGER

SECTION 1 - TRANSFER AND VESTING OF THE ‘AUTOMOTIVE/TRACTOR/ENGINEERING COMPONENTS BUSINESS UNDERTAKING’ (DEMERGED UNDERTAKING) OF PRITIKA INDUSTRIES LIMITED (PIL) (DEMERGED COMPANY) INTO PRITIKA AUTO INDUSTRIES LIMITED (PAIL) (RESULTING COMPANY)

Upon this Scheme becoming effective and with effect from the Appointed Date and pursuant to Sections 230 to 232 and other applicable provisions, if any of the Act and pursuant to the Orders of the Hon’ble NCLT or other Appropriate Authority or forum, if any, sanctioning the Scheme without any further act, instruments, deed, matter and thing, the Demerged Undertaking shall stand demerged and transferred and be vested in the Resulting Company as a going concern, together with all its properties, assets, liabilities, obligations, rights, titles, benefits and interest therein.

5 TRANSFER OF ASSETS

• 5.1 With effect from the Effective Date the Demerged Undertaking (including all the estate, assets, rights including claims, title, interest and authorities including accretions and appurtenances of the Demerged Undertaking) shall, subject to the provisions of Clause Error! Reference source not found. of Part II of the Scheme in relation to the mode of transfer and vesting and pursuant to the provisions of Section 232(3) of the Act, without any further act or deed, be demerged from the Demerged Company and be transferred to and vested in and shall be deemed to be demerged from the Demerged Company and transferred to and vested in the Resulting Company as a going concern so as to become as and from the Appointed Date, the estate, assets, rights, claims, title, interest and authorities of the Resulting Company, subject to the provisions of this Scheme in relation to Encumbrances in favour of banks and/or

• 5.2 In respect of such of the assets of the Demerged Undertaking as are movable in nature or are otherwise capable of transfer by delivery or possession or by endorsement and delivery, the same shall stand so transferred by the Demerged Company upon the coming into effect of the Scheme, and shall become the property of the Resulting Company as an integral part of the Demerged Undertaking with effect from the Appointed Date pursuant to the provisions of Section 232 of the Act without requiring any deed or instrument of conveyance for transfer of the same, subject to the provisions of this Scheme in relation to Encumbrances in favour of banks and/or financial institutions.

• 5.3 In respect of such of the assets belonging to the Demerged Undertaking other than those referred to in sub-clause 5.2 above, the same shall, without any further act, instrument or deed, be demerged from the Demerged Company and transferred to and vested in and/or be deemed to be demerged from the Demerged Company and deemed to be transferred to and vested in the Resulting Company upon the coming into effect of Part II of the Scheme and with effect from the Appointed Date pursuant to the provisions of Sections 230 to 232 of the Act.

• 5.4 All assets, rights, title, licenses, interest and investments of the Demerged Company in relation to the Demerged Undertaking shall also, without any further act, instrument or deed, be and stand transferred to and vested in and be deemed to have been transferred to and vested in the Resulting Company upon the coming into effect of the Scheme and with effect from the Appointed Date pursuant to the provisions of Sections 230 to 232 of the Act.

• 5.5 Without prejudice to the generality of the foregoing, upon the coming into effect of the Scheme, all the rights, title, interest and claims of the Demerged Company in any leasehold properties (including in each case, any applications made therefore) of the Demerged Company in relation to the Demerged Undertaking, shall, pursuant to Section 232 of the Act, without any further act or deed, be transferred to and vested in or be deemed to have been transferred to and vested in the Resulting Company with effect from the Appointed Date.

6 TRANSFER OF CONTRACTS, AGREEMENTS, DEEDS, MOU, PERMITS, QUOTAS AND LICENSES ETC. OF DEMERGED UNDERTAKING.

• 6.1 Upon the coming into effect of the Scheme, and subject to the provisions of this Scheme, all contracts, deeds, bonds, agreements, Schemes, arrangements and other instruments of whatsoever nature in relation to the Demerged Undertaking, to which the Demerged Company is a party or to the benefit of which the Demerged Company may be eligible, and which are subsisting or have effect immediately before the Effective Date shall continue in full force and effect on or against or in favour, as the case may be, of the Resulting Company and may be enforced as fully and effectually as if, instead of the Demerged Company, the Resulting Company had been a party or beneficiary or obligee thereto or there under.

• 6.2 Without prejudice to the other provisions of this Scheme and notwithstanding the fact that vesting of the Demerged Undertaking occurs by virtue of this Scheme itself, the Resulting Company may, at any time after the coming into effect of the Scheme, in accordance with the provisions hereof, if so required under any law or otherwise, take such

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actions and execute such deeds (including deeds of adherence), confirmations or other writings or tripartite arrangements with any party to any contract or arrangement to which the Demerged Company is a party or any writings as may be necessary in order to give formal effect to the provisions of this Scheme. The Demerged Company will, if necessary, also be a party to the above. The Resulting Company shall, under the provisions of this Scheme, be deemed to be authorised to execute any such writings on behalf of the Demerged Company and to carry out or perform all such formalities or compliances referred to above on the part of the Demerged Company to be carried out or performed.

• 6.3 Without prejudice to the generality of the foregoing, it is clarified that upon the coming into effect of the Scheme, all consents, permissions, licenses, approvals, certificates, insurance covers, clearances, authorities given by, issued to or executed in favour of the Demerged Company in relation to the Demerged Undertaking shall stand transferred to the Resulting Company as if the same were originally given by, issued to or executed in favour of the Resulting Company, and the Resulting Company shall be bound by the terms thereof, the obligations and duties there under, and the rights and benefits under the same shall be available to the Resulting Company.

• 6.4 Without prejudice to the aforesaid, it is clarified that if any assets (including estate, claims, rights, title, interest in or authorities relating to any asset) or any contracts, deeds, bonds, agreements, schemes, arrangements or other instruments of whatsoever nature in relation to the Demerged Undertaking which the Demerged Company owns or to which the Demerged Company is a party to, cannot be transferred to the Resulting Company for any reason whatsoever, the Demerged Company shall hold such assets, contracts, deeds, bonds, agreements, Schemes, arrangements or other instruments of whatsoever nature in trust for the benefit of the Resulting Company, insofar as it is permissible so to do, till such time as the transfer is effected.

7 TRANSFER OF LIABILITIES AND RELATED SECURITIES /CHARGES

• 7.1 Upon the coming into effect of the Scheme, all loans raised and used, debts, liabilities, duties and obligations (including the liabilities which arise out of the activities or operations of the Demerged Undertaking) of the Demerged Company as on the Appointed Date and relatable to the Demerged Undertaking shall, without any further act or deed, be and stand transferred to and be deemed to be transferred to the Resulting Company to the extent that they are outstanding as on the Effective Date and shall become the loans, debts, liabilities, duties and obligations of the Resulting Company.

• 7.2 Where any of the loans raised and used, debts, liabilities, duties and obligations of the Demerged Company as on the Appointed Date deemed to be transferred to the Resulting Company have been discharged by the Demerged Company on or after the Appointed Date and prior to the Effective Date, such discharge shall be deemed to have been for and on account of the Resulting Company.

• 7.3 All loans raised and used and all debts, liabilities, duties and obligations incurred by the Demerged Company for the operations of the Demerged Undertaking after the Appointed Date and prior to the Effective Date, subject to the terms of this Scheme, shall be deemed to have been raised, used or incurred for and on behalf of the Resulting Company and to the extent they are outstanding on the Effective Date, shall also without any further act or deed be and stand transferred to and be deemed to be transferred to the Resulting Company and shall become the loans, debts, liabilities, duties and obligations of the Resulting Company.

• 7.4 In so far as the existing Encumbrance in respect of the loans, borrowings, debts, liabilities, is concerned, such Encumbrance shall, without any further act, instrument or deed be modified and shall be extended to and shall operate only over the assets comprised in the Demerged Undertaking which have been Encumbered in respect of the such loans, borrowings, debts, liabilities as transferred to the Resulting Company pursuant to this Scheme. Provided that if any of the assets comprised in the Demerged Undertaking which are being transferred to the Resulting Company pursuant to this Scheme have not been Encumbered in respect of such loans, borrowings, debts,liabilities, such assets shall remain unencumbered and the existing Encumbrance referred to above shall not be extended to and shall not operate over such assets. The absence of any formal amendment which may be required by a lender or third party shall not affect the operation of the above.

• 7.5 For the avoidance of doubt, it is hereby clarified that in so far as the assets comprising the Remaining Business are concerned, the Encumbrance over such assets relating to such loans, borrowings, debts,liabilitiesshall, as and from the Effective Date without any further act, instrument or deed be released and discharged from the obligations and encumbrance relating to the same. The absence of any formal amendment which may be required by a lender or third party shall not affect the operation of the above. Further, in so far as the assets comprised in the Demerged Undertaking are concerned, the Encumbrance over such assets relating to any loans, borrowings or other debts

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which are not transferred pursuant to this Scheme (and which shall continue with the Demerged Company), shall without any further act or deed be released from such Encumbrance and shall no longer be available as security in relation to such liabilities.

• 7.6 Without prejudice to the provisions of the foregoing Clauses and upon the effectiveness of this Scheme, the Demerged Company and the Resulting Company shall execute any instrument/s and/or document/s and/or do all the acts and deeds as may be required, including the filing of necessary particulars and/or modification(s) of charge, with the Registrar of Companies to give formal effect to the above provisions, if required.

• 7.7 Upon the coming into effect of this Scheme, the Resulting Company alone shall be liable to perform all obligations in respect of the Transferred Liabilities, which have been transferred to it in terms of this Scheme, and the Demerged Company shall not have any obligations in respect of such Transferred Liabilities.

• 7.8 It is expressly provided that, save as mentioned in this Clause, no other term or condition of the liabilities transferred to the Resulting Company as part of the Scheme is modified by virtue of this Scheme except to the extent that such amendment is required by necessary implication.

• 7.9 Subject to the necessary consents being obtained, if required, in accordance with the terms of this Scheme, the provisions of this Clause shall operate, notwithstanding anything to the contrary contained in any instrument, deed or writing or the terms of sanction or issue or any security document, all of which instruments, deeds or writings shall stand modified and/or superseded by the foregoing provisions.

8 EMPLOYEE MATTERS

• 8.1 Upon the coming into effect of this Scheme, all Employees of the Demerged Undertaking shall become the employees of the Resulting Company with effect from the Appointed Date, and, subject to the provisions hereof, on terms and conditions not less favourable than those on which they are engaged by the Demerged Company in relation to the Demerged Undertaking and without any interruption of or break in service as a result of the transfer of the Demerged Undertaking. For the purpose of payment of any compensation, gratuity and other terminal benefits, the immediate past services of such Employees with the Demerged Company shall also be taken into account, and paid by the Resulting Companyas and when the same become payable.

• 8.2 In so far as the provident fund and gratuity fund and any other funds or benefits if any created by the Demerged Company inter alia for the Employees are concerned (collectively referred to as the "Funds"), the funds and such investments made by the Funds which are referable to the Employees in terms of sub-Clause 8.1 above shall be transferred to the Resulting Company and shall be held for their benefit pursuant to this Scheme in the manner provided hereinafter. In the event that the Resulting Company does not have its own Funds in respect of any of the above, the Resulting Company may, subject to necessary approvals and permissions, continue to contribute to the relevant Funds of the Demerged Company, until such time that the Resulting Company creates its own Funds, at which time the funds and the investments and contributions pertaining to the Employees shall be transferred to the Funds created by the Resulting Company.

• 8.3 In relation to any other fund created or existing for the benefit of the Employees being transferred to the Resulting Company, the Resulting Company shall stand substituted for the Demerged Company, for all purposes whatsoever, including relating to the obligation to make contributions to the said funds in accordance with the provisions of such Scheme, funds, bye laws, etc. in respect of such Employees.

• 8.4 In so far as the existing benefits or funds created by the Demerged Company for the employees of the Remaining Business are concerned, the same shall continue and the Demerged Company shall continue to contribute to such funds and trusts in accordance with the provisions thereof, and such funds and trusts, if any, shall be held inter alia for the benefit of the employees of the Remaining Business.

• 8.5 In relation to those Employees who are not covered under the provident fund trust of the Demerged Company, and for whom the Demerged Company is making contributions to the government provident fund, the Resulting Company shall stand substituted for the Demerged Company, for all purposes whatsoever, including relating to the obligation to make contributions to the said fund in accordance with the provisions of such fund, bye laws, etc. in respect of such Employees.

• 8.6 In relation to any other fund created or existing inter alia for the benefit of the Employees being transferred to the Resulting Company, the Resulting Company shall stand substituted for the Demerged Company, for all purposes whatsoever, including relating to the obligation to make contributions to the said funds in accordance with the provisions of such scheme, funds, bye laws, etc. in respect of such Employees.

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• 8.7 In so far as the existing benefits or funds created by the Demerged Company for the employees of the Remaining Business are concerned, the same shall continue and the Demerged Company shall continue to contribute to such funds and trusts in accordance with the provisions thereof, and such funds and trusts, if any, shall be held for the benefit of the employees of the Remaining Business.

9 LEGAL, TAXATION AND OTHER PROCEEDINGS

• 9.1 Upon the coming into effect of this Scheme, all legal, taxation or other proceedings, (including before any statutory or quasi-judicial authority or tribunal) by or against the Demerged Company under any statute, whether pending on the Appointed Date or which may be instituted any time thereafter and, in each case, relating to the Demerged Undertaking shall be continued and enforced by or against the Resulting Company with effect from the Effective Date. Except as otherwise provided herein, the Demerged Company shall in no event be responsible or liable in relation to any such legal, taxation or other proceedings against the Resulting Company. The Resulting Company shall be replaced/ added as party to such proceedings and shall prosecute or defend such proceedings at its own cost, in cooperation with the Demerged Company.

• 9.2 If any proceedings are taken against the Demerged Company in respect of the matters referred to in sub-Clause 9.1 above, it shall defend the same in accordance with any reasonable and prudent advice provided by the Resulting Company at the cost of the Resulting Company, and the latter shall reimburse and indemnify the Demerged Company against all liabilities and obligations incurred by the Demerged Company in respect thereof.

• 9.3 The Resulting Company undertakes to have all legal, taxation or other proceedings initiated by or against the Demerged Company in relation to Demerged Undertaking referred to in sub-Clause 9.1 above transferred to its name as soon as is reasonably possible after the Effective Date and to have the same continued, prosecuted and enforced by or against the Resulting Company to the exclusion of the Demerged Company. Both companies shall make relevant applications in that behalf.

SECTION 2: CONDUCT OF BUSINESS

10 The Demerged Company, with effect from the Appointed Date and up to and including the Effective Date:

• 10.1 shall be carrying on and be deemed to have been carrying on all business and activities relating to the Demerged Undertaking and shall hold and stand possessed of and shall be deemed to hold and stand possessed of all the estates, assets, rights, title, interest, authorities, contracts, investments and strategic decisions of the Demerged Undertaking for and on account of, and in trust for, the Resulting Company;

• 10.2 all profits and income accruing or arising to the Demerged Company from the Demerged Undertaking, and losses and expenditure arising or incurred by it (including taxes, if any, accruing or paid in relation to any profits or income) relating to the Demerged Undertaking for the period commencing from the Appointed Date shall, for all purposes, be treated as and be deemed to be the profits, income, losses or expenditure, as the case may be, of the Resulting Company;

• 10.3 any of the rights, powers, authorities, privileges, attached, related or pertaining to the Demerged Undertaking exercised by the Demerged Company shall be deemed to have been exercised by the Demerged Company for and on behalf of, and in trust for and as an agent of the Resulting Company. Similarly, any of the obligations, duties and commitments attached, related or pertaining to the Demerged Undertaking that have been undertaken or discharged by the Demerged Company shall be deemed to have been undertaken for and on behalf of and as an agent for the Resulting Company;

• 10.4 With effect from the effective Date, the Resulting Company shall be duly authorized to carry on the business of the Demerged Undertaking previously carried on by the Demerged Company. The Resulting Company agrees and undertakes to pay, discharge and satisfy all the liabilities and obligations of the Demerged Undertaking with effect from the Appointed Date, in order to give effect to the foregoing provisions.

• 10.5 To avoid any undue hardship to the Demerged company or the Resulting Company on account of disruption of business post the effective date, the Resulting Company shall be entitled to use all the business authorizations, including licenses, contracts etc. having the name of the Demerged company in connection with the Demerged Undertaking, till such authorizations are issued afresh / transferred / renewed in the name of the Resulting Company.

• 10.6 On and from the Effective date and till such time that the name of the bank accounts of the Demerged Company, in relation to or in connection with the Demerged Undertaking, have been replaced with that of the Resulting Company, the Resulting Company shall be entitled to maintain and operate the bank account of the Demerged Company

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pertaining to the Demerged Undertaking, in the name of the Demerged Company for such time as may be determined to be necessary by the Resulting Company. All cheques and other negotiable instruments, payment orders received or presented for encashment which are in the name of the Demerged Company, in relation to or in connection with the Demerged Undertaking after the effective date shall be accepted by the bankers of the Resulting Company and credited to the account of the Resulting Company if presented by the Resulting Company and

• 10.7 the Demerged Company shall carry on the Remaining Business in terms of Section 3 of Part II of this Scheme distinctly and as a separate business from the Demerged Undertaking.

• SECTION 3 - REMAINING BUSINESS / RETAINED UNDERTAKING

• 11 The Remaining Business and all the assets, liabilities and obligations pertaining thereto shall continue to belong to and be vested in and be managed by the Demerged Company.

• 12 All legal, taxation or other proceedings (including before any statutory or quasi-judicial authority or tribunal) by or against the Demerged Company under any statute, whether pending on the Appointed Date or which may be instituted at any time thereafter, and in each case relating to the Remaining Business (including those relating to any property, right, power, liability, obligation or duties of the Demerged Company in respect of the Remaining Business) shall be continued and enforced by or against the Demerged Company after the Effective Date. The Resulting Company shall in no event be responsible or liable in relation to any such legal, taxation or other proceedings against the Demerged Company, which relates to the Remaining Business.

• 13 If proceedings are taken against the Resulting Company in respect of the matters referred to in sub-Clause 9.1 above, it shall defend the same in accordance with the advice of the Demerged Company and at the cost of the Demerged Company, and the latter shall reimburse and indemnify the Resulting Company against all liabilities and obligations incurred by the Resulting Company in respect thereof.

• 14 With effect from the Appointed Date and up to and including the Effective Date:

• 14.1 the Demerged Company shall carry on and be deemed to have been carrying on all business and activities relating to the Remaining Business for and on its own behalf;

• 14.2 all profits accruing to the Demerged Company thereon or losses arising or incurred by it including the effect of taxes, if any, thereon) relating to the Remaining Business shall, for all purposes, be treated as the profits or losses, as the case may be, of the Demerged Company;

• 14.3 all assets acquired and all liabilities incurred by the Demerged Company after the Appointed Date but prior to the Effective Date for operation of and in relation to the Demerged Undertaking shall also without any further act, instrument or deed stand transferred to and vested in or to be deemed to have been transferred to or vested in the Resulting Company upon the coming into effect of the Scheme

SECTION 4 – CONSIDERATION

• 15 The provisions of this Section 4 of this Scheme shall operate notwithstanding anything to the contrary in this Scheme or in any other instrument, deed or writing.

• 16 Upon the Scheme coming into effect, in consideration of the transfer of the Demerged Undertaking by the Demerged Company to the Resulting Company, in terms of this Scheme, the Resulting Company shall, without any further act or deed, issue and allot to every member of the Demerged Company holding fully paid up equity shares in the Demerged Company and whose names appear in the Register of Members of the Demerged Company on the Demerger Record Date in respect of every 10 (Ten) Equity Shares of the face value of Rs. 10/- (Rupees Ten) each fully paid up held by him / her / it in the Demerged Company, 63 (Sixty-Three) new Equity shares of the Resulting Company of the face value of Rs.2/- (Rupees Two) each fully paid up.

• 17 The equity shares issued and allotted by the Resulting Company in terms of this Scheme shall rank paripassu in all respects with the existing equity shares of the Resulting Company.

• 18 The issue and allotment of new equity shares by the Resulting Company to the Shareholders of the Demerged Company pursuant to Clause 16 above is an integral part of this Scheme.

• 19 Fraction shares will be ignored.

• 20 The shares issued pursuant to Clause Error! Reference source not found . of Part II above (“New Shares”), shall be issued to the shareholders of the Demerged Company in demat form, i.e. dematerialized shares unless otherwise

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notified in writing by a shareholder of the Demerged Company to the Resulting Company on or before such date as may be determined by the Board of Resulting Company. In the event that such notice has not been received by Resulting Company in respect of any of the shareholders of Demerged Company, the equity shares, shall be issued to such shareholders in dematerialized form provided that the shareholders of Demerged Company shall be required to have an account with a depository participant and shall be required to provide details thereof and such other confirmations as may be required. In the event that Resulting Company has received notice from any shareholder that the equity shares are to be issued in physical form or if any shareholder has not provided the requisite details relating to his/ her/ its account with a depository participant or other confirmations as may be required or if the details furnished by any shareholder do not permit electronic credit of the shares of Resulting Company, then the Resulting Company shall issue the equity shares in physical form to such shareholder or shareholders.

• 21 Unless otherwise determined by the Board of Directors or any committee thereof of the Demerged Company and the Resulting Company, allotment of shares in terms of Clause 16 of Part II above shall be done within 45 days from the Demerger Record Date.

• 22 The New Shares allotted and issued in terms of Clause 16 of Part II above, shall be listed and/or admitted to trading on the Stock Exchanges after obtaining the requisite approvals. The Resulting Company shall enter into such arrangements and give such confirmations and/or undertakings as may be necessary in accordance with Applicable Laws for complying with the formalities of the Stock Exchanges.

• 23 The equity shares of the Resulting Company allotted pursuant to the Scheme shall remain frozen in the depositories system till listing / trading permission is given by the designated stock exchange.

• 24 Till the listing of the equity shares of the Resulting Company, there will be no change in the pre-arrangement capital structure and shareholding pattern or controls in the Resulting Company which may affect status of the approval of the stock exchanges to this Scheme.

• 25 Approval of the Scheme by the shareholders of Pritika Auto Industries Limited (PAIL) shall be deemed to be due compliance of the provisions of section 42, 62 if any and other relevant or applicable provisions of the Companies Act, 2013 and Rules made thereunder for the issue and allotment of the Equity shares by PAIL to the shareholders of PIL as provided here in above.

PART III

SECTION 5 - GENERAL TERMS AND CONDITIONS:

26 ACCOUNTING TREATMENT IN THE BOOKS OF THE DEMERGED COMPANY

• 26.1 The Demerged Company shall account for Demerger of Demerged Undertaking in its books as per the applicable accounting principles prescribed under the relevant IND – AS. It shall inter alia include the following:

• 26.2 The Demerged Company shall in its books of accounts reduce the respective carrying values of the assets and liabilities of the Demerged Undertaking being transferred to and vested in the Resulting Company at values appearing in Books of Accounts of the Demerged Company as on the Appointed Date.

• 26.3 The aggregate of the net assets (i.e. difference between the carrying value of assets and liabilities related to the Demerged Undertaking) standing in the books of accounts of the Demerged company transferred to the Resulting Company on the appointed date, shall be either debited or credited to Goodwill or Capital Reserve as the case may be.

• 26.4 The investment of the Demerged Company into the Equity share Capital of the resulting Company as on the effective date shall not stand reduced or cancelled and the same will continue to hold by the Demerged Company.

• 26.5 Notwithstanding anything above, the Board of Directors of the Demerged Company in consultation with their statutory auditors is authorized to account for any of the above-mentioned transactions or any matter not dealt with under this clause in accordance with the applicable Indian Accounting Standards prescribed under section 133 of the Companies Act, 2013 and generally accepted accounting principles.

27 ACCOUNTING TREATMENT IN THE BOOKS OF THE RESULTING COMPANY

• 27.1 The Resulting Company shall account for the Demerger of Demerged Undertaking using pooling of interest method in accordance with Appendix C- “Business Combinations of entities under common control” of Ind -As 103- “Business Combinations”. It shall inter alia include the following

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• 27.2 The Resulting Company shall record all the assets and liabilities of the Demerged Undertaking transferred to it in pursuance of this Scheme at their respective carrying values appearing in the books of accounts of the Demerged Company as on the Appointed date which are set forth in the closing balance sheet of the Demerged Company as of the close of business hours on the date immediately preceding the Appointed Date

• 27.3 The Resulting Company shall credit its share Capital account, with the aggregate face value of the new equity shares issued to the shareholders of the Demerged company pursuant to the demerger of the Demerged Undertaking

• 27.4 To the extent there are intercompany balance(s) and transactions between the Resulting company and the Demerged Undertaking if any the rights and obligations in respect thereof will stand cancelled.

• 27.5 The difference between the book value of assets and book value of liabilities so recorded in the books of the Resulting Company in accordance with 27.2 as reduced by the amount credited as share capital in accordance with clause 27.3, shall be recorded either as Goodwill or Capital Reserve as the case may be.

• 27.6 In case of any difference in accounting policy followed by Demerged company in respect of Demerged Undertaking vis a vis the accounting policy followed by the Resulting Company, the impact of the same till the Appointed Date will be quantified and adjusted in Reserves of the Resulting Company, to ensure that upon coming into effect of this Scheme, the financial statements of the Resulting company reflect the financial position on the basis of a consistent accounting policy.

• 27.7 Notwithstanding anything above, the Board of Directors of the Resulting Company in consultation with their statutory auditors, is authorized to account for any of the above-mentioned transactions or any matter not dealt with under this clause in accordance with the applicable Indian Accounting Standards prescribed under section 133 of the Companies Act, 2013 and generally accepted accounting principles.

28 TREATMENT OF TAXES

• 28.1 With effect from the Appointment Date and upon the Scheme becoming effective, all taxes and duties (including but not limited to Income Tax, Goods and Services Tax etc.) paid or payable by Demerged Company and relating to the operations of the Demerged Undertaking, including all advance tax payments, tax deducted at source, credits for minimum alternate tax, shall for all purposes be treated as tax, duty or cess liability, advance tax payments, tax deducted at source, credits for minimum alternate tax as the case may be of the Resulting Company.

• 28.2 Upon the Scheme becoming effective, the Demerged Company and the Resulting Company shall be permitted to revise from the Appointed Date, their respective financial statements and returns along with prescribed forms, filings and annexures under the Income Tax Act 1961, Goods and Services Tax Laws, Custom Law and other tax Laws and to claim refunds and / or credit for taxes paid (including minimum alternate tax, tax deducted at source etc.) and for matters incidental thereto, if required to give effect to the provisions of the Scheme and to claim refunds / credits, pursuant to provisions of this Scheme.

• 28.3 Upon the Scheme becoming effective, the Demerged Company and the Resulting Company would undertake appropriate filings under the Goods and Service Tax Rules, to facilitate claim of refunds and / or transfer of credit for taxes paid and for matters incidental thereto in relation to the Demerged Undertaking available with the Demerged Company.

• 28.4 All disallowances under Section 43 B of the Income Tax Act, 1961 in the hands of the Demerged Company, in relation and pertaining to the Demerged Undertaking shall be claimed as a deduction under Section 43 B of the Income Tax Act, 1961 by the Resulting company when the payment is made by the Resulting Company against such expenses.

• 28.5 Any refunds or credits (including credit for minimum alternate tax, advance tax and tax deducted at source under the provisions of Income Tax Act, 1961), benefit or carry forward losses and other statutory benefits under the Income Tax Act, 1961. Service Tax laws, Central sales tax, Goods and Services Tax, applicable State Value Added Tax Laws or other applicable laws / regulations dealing with taxes / duties /levies due to the Demerged Company, relating to Demerged Undertaking including refunds, benefits or credits consequent to the assessment made on the Demerged Company (including any refund for which no credit is taken in the accounts of the Demerged Company) as on the date immediately preceding the Appointed Date shall also belong to and be received by the Resulting Company upon the Scheme becoming effective.

• 28.6 Further any tax deducted at source by the Demerged Company with respect to the Demerged Undertaking on transactions with the Resulting Company, if any (from the Appointed Date to the Effective Date) shall be deemed to be advance tax paid by the Resulting company and shall in all proceedings, be dealt with accordingly and vice versa.

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• 28.7 Upon the Scheme coming into effect any obligation of tax deduction at source on any payment made by or to be made by the Demerged Company relating to the Demerged Undertaking shall be made or deemed to have been made and duly complied with the Resulting Company.

29 SCHEME CONDITIONAL ON

This Scheme is conditional upon and subject to:

• 29.1 The requisite consents, no-objections and approvals of the Stock Exchanges and SEBI to the Scheme in terms of the SEBI Circular and under Regulation 37 of SEBI(LODR) Regulations, 2015, on terms acceptable to the Demerged Company and the Resulting Company.

• 29.2 the Scheme being agreed to by the respective requisite majorities of the various classes of members and creditors of the Demerged Company and the Resulting Company as required under the Act and the requisite order of the National Company Law Tribunal, Chandigarh Bench, Chandigarh being obtained.

• 29.3 As para 9 of SEBI Circular No. CFD/ DIL3 / CIR /2017 / 21 dated 10th March, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 as amended from time to time is applicable to this Scheme; therefore, it is provided in the Scheme that the Resulting Company will provide voting by the public shareholders through e-voting and will disclose all material facts in the explanatory statement to be sent to the shareholders in relation to the said Resolution.

• 29.4 As para 9 of SEBI Circular No. CFD/ DIL3 / CIR /2017 / 21 dated 10th March, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 as amended from time to time is applicable to this Scheme, the Scheme shall be acted upon only if the votes cast by the public shareholders of the Resulting Company in favour of the Scheme are more than the number of votes cast by the public shareholders against it. The term “Public” shall carry the same meaning as defined under Rule 2 of Securities Contracts (Regulations) Rules, 1957

• 29.5 such other sanctions and approvals as may be required by law in respect of this Scheme being obtained; and

• 29.6 the Certified copies of the NCLT Order referred to in this Scheme being filed with the Registrar of Companies, Punjab and Chandigarh by the Demerged Company and the Resulting Company.

SECTION 6 - OTHER TERMS AND CONDITIONS

30 DIVIDENDS

• 30.1 The Demerged Company and the Resulting Company shall be entitled to declare and pay dividends in normal course, whether interim or final, to their respective shareholders in respect of the accounting period prior to the Effective Date, as applicable.

• 30.2 The Equity shares of the Resulting Company to be issued and allotted to the Equity shareholders of the Demerged Company as provided in Clause 16 hereof shall be entitled to dividends from the date of allotment.

• 30.3 The holders of the shares of the Demerged Company and the Resulting Company shall, save as expressly provided otherwise in this Scheme, continue to enjoy their existing rights under their respective articles of association including the right to receive dividends.

• 30.4 It is clarified that the aforesaid provisions in respect of declaration of dividends are enabling provisions only and shall not be deemed to confer any right on any member of the Demerged Company and/or the Resulting Company to demand or claim any dividends which, subject to the provisions of the said Act, shall be entirely at the discretion of the boards of directors of the Demerged Company and the Resulting Company respectively, and subject to the approval, if required, of the shareholders of the Demerged Company and the Resulting Company respectively.

• 31 The Demerged Company and the Resulting Company may, after the Scheme becomes effective, for the sake of good order, execute amended and restated arrangements or confirmations or other writings if required for the ease of the Demerged Company, the Resulting Company and the counter party concerned in relation to the remaining business and / or the Demerged Undertaking, without any obligations to do so and without modification of any commercial terms or provisions in relation thereto.

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32 APPLICATION TO NATIONAL COMPANY LAW TRIBUNAL

• 32.1 The Demerged Company and the Resulting Company shall make necessary applications / petitions before the National Company Law Tribunal, Chandigarh Bench, Chandigarh for the sanction of this Scheme under Sections 230 to 232 and other applicable provisions of the Act.

• 32.2 The Resulting Company shall be entitled, pending the sanction of the Scheme, to apply to any Governmental Authority and all agencies, departments and Appropriate Authorities concerned as are necessary under any law, for such consents, approvals and sanctions which the Resulting Company may require to own and operate the Demerged Undertaking.

33 SAVING CONCLUDED TRANSACTIONS

The transfer and vesting of the assets, liabilities and obligations of the Demerged Undertaking shall not in any manner affect any transaction or proceedings, contracts and deeds already concluded by the Demerged Company (in respect of Demerged Undertaking) on or before the Appointed Date and after the Appointed Date till the Effective Date, to the end and intent that the Resulting Company accepts and adopts all such acts, deeds and things done and executed by and / or on behalf of the Demerged Company as acts, deeds and things done and executed by and on behalf of the Resulting Company.

34 TREATMENT OF THE SCHEME FOR THE PURPOSES OF IT ACT

The Scheme has been drawn up to comply with the conditions relating to “Demerger” as specified under Section 2(19AA) of the IT Act. If any of the terms or provisions of the Scheme are found or interpreted to be inconsistent with the provisions of the said section at a later date including resulting from an amendment of Applicable Law or for any other reason whatsoever, the provisions of the said section shall prevail and the Scheme shall stand modified to the extent necessary to comply with the Section 2(19AA) of the IT Act. Such modification will however not affect other parts of the Scheme. The power to make such modifications / amendments as may become necessary, shall vest with the Board of Directors of the Demerged Company and Resulting Company which can exercise the power at any time and shall be exercised in the best interest of the Demerged company and the Resulting Company.

35 MODIFICATIONS OF SCHEME

• 35.1 The Demerged Company and the Resulting Company through their Board of Directors may consent on behalf of all persons concerned to any modifications or amendments of this Scheme or to any conditions which the SEBI/ Hon’ble NCLT and/or any other authorities under law may deem fit to approve of or impose or which may otherwise be considered necessary or desirable for settling any question or doubt or difficulty that may arise for carrying out the Scheme and do all acts, deeds and things as may be necessary, desirable or expedient for putting this Scheme into

• 35.2 However, no modifications and / or amendments to the Scheme can be carried out or effected by the Board of Directors without approval of the SEBI / NCLT or any other Authorities and the same shall be subject to powers of the respective authorities.

• 35.3 For the purpose of giving effect to this Scheme or to any modifications thereof, the Directors of the Demerged Company and the Resulting Company are authorized to give such directions and/or to take such steps as may be necessary or desirable including any directions for settling any question or doubt or difficulty whatsoever that may arise.

• 35.4 The Demerged Company and Resulting Company shall take such other steps as may be necessary or expedient to give full and formal effect to the provisions of this Scheme.

36 SEVERABILITY

If any provision of this Scheme is found to be unworkable for any reason whatsoever, the same shall not, subject to the mutual agreement of the Demerged Company and the Resulting Company in writing, affect the validity or implementation of the other provisions of this Scheme. If any provision of this Scheme hereof is invalid, ruled illegal by any court or tribunal of competent jurisdiction or unenforceable under present or future Applicable Laws, then it is the intention of the Parties that such provision shall be severable from the remainder of the Scheme, and the Scheme shall not be affected thereby, unless the deletion of such provision shall cause this Scheme to become materially adverse to any Party, in which case the Parties shall attempt to bring about a modification in the Scheme, as will best preserve for such Parties the benefits and obligations of the Scheme, including but not limited to such provision.

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37 EEFECT OF NON-RECEIPT OF APPROVALS

• 37.1 In the event of any of the said sanctions and approvals not being obtained and/or the Scheme not being sanctioned by the Tribunal, and/or the order or orders not being passed as aforesaid on or before 15 (fifteen) months from the date of approvals of the Scheme by respective Boards of the Parties or within such extended period as may be mutually agreed upon between the Demerged Company and the Resulting Company through their respective Boards or their authorized representatives, this Scheme shall become null and void and each party shall bear and pay its respective costs, charges and expenses for and/ or in connection with this Scheme.

• 37.2 In the event of revocation/withdrawal of the Scheme, no rights and liabilities whatsoever shall accrue to or be incurred inter se the Demerged Company and the Resulting Company or their respective shareholders or creditors or employees or any other person, save and except in respect of any act or deed done prior thereto as is contemplated hereunder or as to any right, liability or obligation which has arisen or accrued pursuant thereto and which shall be governed and be preserved or worked out as is specifically provided in the Scheme or in accordance with the Applicable Law and in such case, each party shall bear its owns costs, unless otherwise mutually agreed.

38 REVOCATION OF SCHEME

• 38.1 The Demerged Company and the Resulting Company acting jointly through their respective Boards shall each be at liberty to withdraw from this Scheme prior to the effective date at any time and the same shall not be construed as any non-compliance of the Act,

• 38.2 The Demerged Company and/or Resulting Company acting through their respective Boards shall each be at liberty to withdraw from this Scheme in case the Demerged Company or the Resulting Company is declared insolvent.

• 38.3 In the event any of the conditions are imposed by the SEBI/ Hon’ble NCLT or any authorities, which the Board of Directors of the Demerged Company and the Resulting Company find unacceptable for any reason, the Demerged Company and the Resulting Company shall be at liberty to withdraw this Scheme.

39 MUTATION OF PROPERTY

Upon the Scheme coming into effect and with effect from the Appointed Date, the title to the immovable properties, of the Demerged Undertakings shall be deemed to have been mutated and recognized as that of the Resulting Company and the mere filing of the certified true copy of the vesting order of the Tribunal sanctioning the Scheme with the appropriate Registrar or Sub-registrar of Assurances or with the relevant Government agencies shall suffice as record of continuing title of the immovable properties of the Demerged Undertakings with the Resulting Company pursuant to the Scheme becoming effective and shall constitute a deemed mutation and substitution thereof.

40 SEQUENCE OF COMING INTO EFFECTS OF THIS SCHEME

On the sanction of the Scheme and upon the Scheme becoming effective, the following shall be deemed to become effective and operative in the sequence and order mentioned hereunder.

• (a) Demerger of the Demerged Undertaking from Demerged Company to Resulting Company

• (b) Issue and allotment of Equity shares by the Resulting Company to the shareholders of the Demerged Company in consideration of Demerger as aforesaid.

41 COSTS

Upon the sanction of this Scheme by the NCLT all costs, charges, taxes (including but not limited to stamp duty, registration charges, etc.) levies and all other expenses if any ( save as expressly otherwise agreed) on any deed, documents, instruments or Hon’ble NCLT Order arising out of and in carrying out and implementing this scheme and matters incidental to the completion of arrangement in relation to the Demerger shall be borne and paid by the Demerged Company and Resulting Company as mutually agreed upon.

42 MISCELLANEOUS

The Scheme does not contain or provide for any compromise with the Creditors of the Demerged Company and the Resulting Company. Further, the Scheme has not been drawn to accommodate any corporate debt restructuring. The Scheme also does not come under the purview of the Competition Commission of India.

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Summary of the Valuation report along with the basis of such valuation

• I. The management of Pritika Industries Limited (the Demerged Company) and Pritika Auto Industries Limited (the Resulting Company) have appointed PayalGada& Co, Chartered Accountants and Registered Valuer, Mumbai as independent valuer to recommend a fair ratio of allotment of equity shares of Resulting Company to the Equity Shareholders of Demerged Company of the proposed Scheme of Arrangement.

• II. For the purpose of arriving at the share entitlement ratio, the valuation report was obtained in terms of the SEBI Circular No. circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020

• III. The valuer has considered

• (a) the value based on fair value of equity shares of PIL attributable to the Automotive / Tractor/ Engineering Components Business Undertaking of PIL.

• (b) value based on fair value per equity share of PAIL.

• IV. The valuer has also considered Market Price method (Market approach), Comparable Companies’ Multiples method / Guideline Company method (Income / Market approach) Net Asset Value method (Asset approach), Discounted Cash Flow Method by assigning appropriate weights.

• V. On consideration of all the relevant factors and circumstances, the valuer has recommended a ratio of 63 (sixtythree) equity share of PAIL of INR 2/- each fully paid up for, not in exchange of, every 10 (ten) equity shares of PIL of INR 10/- each fully paid up and has been approved by the Audit Committee of Demerged Company and the Resulting Company.

• VI. The Fairness opinion dated 14thAugust, 2021 was issued by Systematix Corporate Services Limited, a SEBI registered Merchant Banker, explaining the rationale for their opinion as to the fairness of the share entitlement ratio from a financial point of view.

• VII. The above share entitlement ratio has been arrived at on the basis of a relative valuation for the Demerged Undertaking and for each of the Companies based on the various qualitative factors relevant to each company and the business dynamics and growth potentials of the businesses of the Companies, having regards to information base, key underlying assumptions and limitations.

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Annexure - 9

REPORT ADOPTED BY THE BOARD OF DIRECTORS OF PRITIKA AUTO INDUSTRIES LIMITED AT ITS MEETING HELD ON SATURDAY THE 14THDAY OFAUGUST, 2021 EXPLAINING THE EFFECT OF SCHEME ON EQUITY SHAREHOLDERS, KEY MANAGERIAL PERSONNEL, PROMOTERS AND NON-PROMOTER SHAREHOLDER

1. The proposed Scheme of arrangement is between Pritika Industries Limited (PIL) the Demerged company and Pritika Auto Industries Limited (PAIL) the Resulting company for de-merger and vesting of the “Automotive/Tractor/Engineering Components Business Undertaking”of Pritika Industries Limited into Pritika Auto Industries Limited with special reference to the feasibility of conveniently combining theAutomotive/Tractor/Engineering Components Business Undertaking of Pritika Industries Limited into Pritika Auto Industries Limited and other synergic, administrative, operational and monetary advantages derived upon such combination.

The Board of Directors concluded that the Automotive/Tractor/Engineering Components Business Undertaking of PritikaIndustries Limited can be conveniently combined with the business of Pritika Auto Industries Limited to the greater advantage of the shareholders, creditors and other concerned persons.

The Scheme of arrangement was approved by the Board of Directors of PAIL vide resolution dated 14thday of August, 2021.

1. As per Section 232(2)(c) of the Companies Act, 2013 a report is required to be adopted by the Directors explaining the effect of Scheme of arrangement on each class of shareholders, key managerial personnel (KMPs), promoters and non-promoters’ shareholders of the Company laying out in particular the share exchange ratio specifying any special valuation difficulties (‘Report’)

2. Having regard to the applicability of the aforesaid provisions, the Scheme and the following documents are placed before the Board.

3. A Draft Scheme duly initialed by the Director for the purpose of identification.

4. B Valuation Report dated 14thday of August, 2021issued by M/s. PayalGada (‘’the Register Valuer’’), Chartered Accountants (Valuation Report’’).

5. C Fairness Opinion dated 14thday of August, 2021 issued by Systematix Corporate Services Limited.

6. D Summary of the Valuation report along with the basis of such valuation.

7. E Certificate dated 14th day of August, 2021 issued by M/s. Sunil Kumar Gupta& CoChartered Accountants the statutory auditors of the company as required under section 232(3) of the Companies Act, 2013 certifying that the accounting treatment in the draft scheme is in accordance with the accounting standards and applicable law.

8. F A copy of the audit committee report dated 14th August, 2021 in terms of requirements of SEBI Circular No. c i r c u l a r N o . C F D / D I L 3 / C I R / 2 0 1 7 / 2 1 d a t e d M a r c h 1 0 , 2 0 1 7 a n d c i r c u l a r n o . SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 issued by Securities and Exchange Board of India (SEBI)

9. Rationale of the Scheme

The Demerged Company is engaged in various businesses and owns the following two business undertakings.

• Automotive/Tractor/Engineering Components Business undertaking

• Healthcare and investment business undertaking.

The Demerged company would demerge Automotive/Tractor/Engineering Components Business undertaking (hereinafter referred to as “Demerged Undertaking”) to the Resulting company and it would continue to run and operate the healthcare and investment business undertaking (hereinafter referred to as the “Remaining Business / Retained Undertaking”). The underlying business rationale and objectives are as follows.

• a) With the complete integration of the Demerged Undertaking with Resulting Company, the manufacturing and machining capacity of the Resulting Company will stand enhanced. Since, PIL fulfils its raw material supply (i.e., Raw Castings) needs from PAIL, the Demerger would eliminate the inter dependence and shall be a forward integration of manufacturing and machining activities of PAIL which in turn add to efficiency, economy in operations and ultimately add to shareholders wealth.

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• b) PIL and PAIL are in the same line of business and cater the needs of same customers (i.e. OEMs). The Scheme of Arrangement would consolidate and synchronize the business structure and eliminate the unnecessary competition and conflict of interest within the group which will create transparency and confidence with the investors and the market.

• c) The Demerged Company currently has business interest in diverse businesses such as Manufacturing, Healthcare and Investment & Financing activities and other allied activities. With a view to achieve greater management focus in other business activities, Demerged Company proposes to demerge its business interest in the Demerged Undertaking and vest the same in the Resulting Company.

• d) The consolidation of operations of the Manufacturing Business of Demerged Company and the Resulting Company by merging the Demerged Undertaking into Resulting Company, will lead to a more efficient utilisation of capital, administrative and operational rationalization and promote organisational efficiencies. It will help achieve cost efficiency that will enhance the financial efficiencies and help achieve economies of scale, reduction in overheads and improvement in various other operating parameters.

• e) The Demerged undertaking and remaining undertaking have their own set of strengths and dynamics in the form of nature of risks, competition, challenges, opportunities and business methods leading to different growth potentials. Hence segregation of the two undertakings would enable a focused management to explore the potential business opportunities effectively and efficiently.

• f) The demerger would result in achieving efficiency in operational process by designing and implementing independent strategies specifically designed for the two businesses and in optimising profitability. This would in turn enhance the shareholders wealth.

• g) Targeting and attracting new investors with specific focus and expertise in the two businesses thereby providing the necessary funding impetus to the long-term growth strategy of the two businesses.

• h) Integration would result in maximising overall shareholder value, improvising the competitive position and enabling to unlock the economic value of both the entities.

• i) Improved organisational capability and leadership, arising from the pooling of human capital who have the diverse skills, talent and vast experience to compete successfully in an increasingly competitive industry.

• j) Cost savings are expected to flow from more focused operational efforts, rationalization, standardisation and simplification of business processes, and the elimination of duplication, and rationalization of administrative expenses.

In view of the aforesaid, the Board of Directors of the Demerged Company and the Resulting Company have considered it desirable and expedient to demerge the Demerged Undertaking of the Demerged Company and vest the same with the Resulting Company, in order to benefit the stakeholders of both the companies.

Accordingly, the Board of Directors of the Demerged Company and the Resulting Company have formulated this Scheme of Arrangement for the transfer and vesting of the Demerged Undertaking with and into the Resulting Company pursuant to the provisions of Section 230 to Section 232 and other relevant provisions of the Act.

5.

Sr. No.	Category of Stakeholder	Efect of the Scheme
(i)	Shareholders	The Company has only Equity Shareholders and does not have any preference shareholders. Upon this scheme coming into efect, in consideration of the transfer of the Demerged Undertaking by the Demerged Company to the Resulting Company, in terms of this scheme, the Resulting Company shall, without any further act or deed, issue and allot to every member of the Demerged Company holding fully paid up equity shares in the Demerged Company and whose names appear in the Register of Members of the Demerged Company on the record date in respect of every 10 (Ten) Equity Shares of the face value of Rs. 10/- (Rupees Ten) each fully paid up held by him / her / it in the Demerged Company, 63 (Sixty-Three) new Equity shares of the Resulting Company of the face value of Rs.2/- (Rupees Two) each fully paid up.

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Sr. No.	Category of Stakeholder	Efect of the Scheme
(ii)	Promoters	Promoters are holding 4,26,74,155 Equity shares (48.13%); hence as mentioned in point (i) above, 6,18,19,504 new Equity shares will be issued to the shareholders of the Demerged company who are promoters of the Company and the promoters shareholding will go upto10,44,93,659 Equity Shares (69.43%).
(iii)	Non- Promoter Shareholders	Please refer to point (i) above the details regarding efect on shareholder.
(iv)	Key Managerial Personnel and Directors	Under the Scheme, no right of the Employees of PIL of the remaining undertaking is being afected. The services of the Employees of PIL of the remaining undertaking, under the scheme, shall continue on the same terms and conditions on which they were engaged by PIL. There is no efect of the Scheme on the key managerial personnel and/or the Directors of PAIL. Further no change in the Board of Directors of the company is envisaged on account of the Scheme. The Key managerial Personnel of the Company (KMP’s) and Directors shall continue as Key Managerial Personnel and Directors of the Company after efectiveness of the Scheme. The KMP’s and Directors are shareholders of the Demerged Company hence; they will get shares of the Resulting company in the same ratio as mentioned in point no.(i) above Under part II point 8 of the Scheme, on and from the Efective Date, PAIL undertakes to engage the Employees of PIL, engaged in or in relation to the Demerged Undertaking, on the same terms and conditions on which they are engaged by PIL without any interruption of service and in the manner provided under part II point 8 of the Scheme.
(v)	Creditors / Public Depositors / Debenture holders	There are no Public Depositors and Debenture holders in the Company and hence there is no efect on the same. There is no efect on Creditors of the Company.

7 Valuation

• I. For the purpose of arriving at the share entitlement ratio, the valuation report was obtained in terms of the SEBI Circular No. circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020.

• II. The valuer has considered

• a. the value based on fair value of equity shares of PIL attributable to the Automotive / Tractor/ Engineering Components Business Undertaking of PIL.

• b. value based on fair value per equity share of PAIL.

• III. The valuer has also considered Market Price method (Market approach), Comparable Companies’ Multiples method / Guideline Company method (Income / Market approach) Net Asset Value method (Asset approach), Discounted Cash Flow Method by assigning appropriate weights.

• IV. On consideration of all the relevant factors and circumstances, the valuer has recommended a ratio of 63 (sixtythree) equity share of PAIL of INR 2/- each fully paid up for, not in exchange of, every 10 (ten) equity shares of PIL of INR 10/- each fully paid up and has been approved by the Audit Committee of Demerged Company and the Resulting Company.

• V. The Fairness opinion dated 14thAugust, 2021 was issued by Systematix Corporate Services Limited, a SEBI registered Merchant Banker, explaining the rationale for their opinion as to the fairness of the share entitlement

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ratio from a financial point of view.

• VI. The above share entitlement ratio has been arrived at on the basis of a relative valuation for the Demerged Undertaking and for each of the Companies based on the various qualitative factors relevant to each company and the business dynamics and growth potentials of the businesses of the Companies, having regards to information base, key underlying assumptions and limitations.

8

No special valuation difficulties were reported

9 Adoption of Report by the Directors

The Directors of the Company have adopted this report after noting and considering information set forth in this report. The Board or any duly authorised committee by the Board is entitled to make relevant modification to this report, if required and such modifications or amendments shall be deemed to form part of this report

By Order of the Board

For Pritika Auto Industries Limited

Sd/-

Harpreet Singh Nibber

Managing Director

DIN: -00239042

Dated 14th August, 2021

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Annexure - 10

REPORT ADOPTED BY THE BOARD OF DIRECTORS OF PRITIKA INDUSTRIES LIMITED AT ITS MEETING HELD ON SATURDAY THE 14TH DAY OF AUGUST, 2021 EXPLAINING THE EFFECT OF SCHEME ON EQUITY SHAREHOLDERS, KEY MANAGERIAL PERSONNEL, PROMOTERS AND NON-PROMOTER SHAREHOLDER

1. The proposed Scheme of arrangement is between Pritika Industries Limited (PIL) the Demerged company and Pritika Auto Industries Limited (PAIL) the Resulting company for de-merger and vesting of the “Automotive/Tractor/Engineering Components Business Undertaking” of Pritika Industries Limited into Pritika Auto Industries Limited with special reference to the feasibility of conveniently combining the Automotive/Tractor/Engineering Components Business Undertaking of Pritika Industries Limited into Pritika Auto Industries Limited and other synergic, administrative, operational and monetary advantages derived upon such combination.

The Board of Directors concluded that the Automotive/Tractor/Engineering Components Business Undertaking of Pritika Industries Limited can be conveniently combined with the business of Pritika Auto Industries Limited to the greater advantage of the shareholders, creditors and other concerned persons.

The Scheme of arrangement was approved by the Board of Directors of PIL vide resolution dated 14thday of August, 2021.

1. As per Section 232(2)(c) of the Companies Act, 2013 a report is required to be adopted by the Directors explaining the effect of Scheme of arrangement on each class of shareholders, key managerial personnel (KMPs), promoters and non-promoters’ shareholders of the Company laying out in particular the share exchange ratio specifying any special valuation difficulties (‘Report’)

2. Having regard to the applicability of the aforesaid provisions, the Scheme and the following documents are placed before the Board.

3. A. Draft Scheme duly initialed by the Director for the purpose of identification. B. Valuation Report dated 14th day of August, 2021 issued by M/s. PayalGada (‘’the Register Valuer’’), Chartered Accountants (Valuation Report’’).

4. C. Fairness Opinion dated 14th day of August, 2021 issued by Systematix Corporate Services Limited.

5. D. Summary of the Valuation report along with the basis of such valuation.

6. E. Certificate dated 14th day of August, 2021 issued by M/s. A K Sood&Associates,Chartered Accountants the statutory auditors of the company as required under section 232(3) of the Companies Act, 2013 certifying that the accounting treatment in the draft scheme is in accordance with the accounting standards and applicable law.

7. F. A copy of the audit committee report dated 14th August, 2021 in terms of requirements of SEBI Circular No. circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020 issued by Securities and Exchange Board of India (SEBI)

4. Rationale of the Scheme

• The Demerged Company is engaged in various businesses and owns the following two business undertakings.

• Automotive/Tractor/Engineering Components Business undertaking

• Healthcare and investment business undertaking.

The Demerged company would demerge Automotive/Tractor/Engineering Components Business undertaking (hereinafter referred to as “Demerged Undertaking”) to the Resulting company and it would continue to run and operate the healthcare and investment business undertaking (hereinafter referred to as the “Remaining Business / Retained Undertaking”). The underlying business rationale and objectives are as follows.

• a) With the complete integration of the Demerged Undertaking with Resulting Company, the manufacturing and machining capacity of the Resulting Company will stand enhanced. Since, PIL fulfils its raw material supply (i.e., Raw Castings) needs from PAIL, the Demerger would eliminate the inter dependence and shall be a forward integration of manufacturing and machining activities of PAIL which in turn add to efficiency, economy in operations and ultimately add to shareholders wealth.

• b) PIL and PAIL are in the same line of business and cater the needs of same customers (i.e. OEMs). The Scheme of Arrangement would consolidate and synchronize the business structure and eliminate the unnecessary competition

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and conflict of interest within the group which will create transparency and confidence with the investors and the market.

c) The Demerged Company currently has business interest in diverse businesses such as Manufacturing, Healthcare and Investment & Financing activities and other allied activities. With a view to achieve greater management focus in other business activities, Demerged Company proposes to demerge its business interest in the Demerged Undertaking and vest the same in the Resulting Company.

d) The consolidation of operations of the Manufacturing Business of Demerged Company and the Resulting Company by merging the Demerged Undertaking into Resulting Company, will lead to a more efficient utilisation of capital, administrative and operational rationalization and promote organisational efficiencies. It will help achieve cost efficiency that will enhance the financial efficiencies and help achieve economies of scale, reduction in overheads and improvement in various other operating parameters.

e) The Demerged undertaking and remaining undertaking have their own set of strengths and dynamics in the form of nature of risks, competition, challenges, opportunities and business methods leading to different growth potentials. Hence segregation of the two undertakings would enable a focused management to explore the potential business opportunities effectively and efficiently.

f) The demerger would result in achieving efficiency in operational process by designing and implementing independent strategies specifically designed for the two businesses and in optimising profitability. This would in turn enhance the shareholders wealth.

g) Targeting and attracting new investors with specific focus and expertise in the two businesses thereby providing the necessary funding impetus to the long-term growth strategy of the two businesses.

• h) Integration would result in maximising overall shareholder value, improvising the competitive position and enabling to unlock the economic value of both the entities.

i) Improved organisational capability and leadership, arising from the pooling of human capital who have the diverse skills, talent and vast experience to compete successfully in an increasingly competitive industry.

• j) Cost savings are expected to flow from more focused operational efforts, rationalization, standardisation and simplification of business processes, and the elimination of duplication, and rationalization of administrative expenses.

In view of the aforesaid, the Board of Directors of the Demerged Company and the Resulting Company have considered it desirable and expedient to demerge the Demerged Undertaking of the Demerged Company and vest the same with the Resulting Company, in order to benefit the stakeholders of both the companies.

Accordingly, the Board of Directors of the Demerged Company and the Resulting Company have formulated this Scheme of Arrangement for the transfer and vesting of the Demerged Undertaking with and into the Resulting Company pursuant to the provisions of Section 230 to Section 232 and other relevant provisions of the Act.

5.

Sr. No.	Category of Stakeholder	Efect of the Scheme
(i)	Shareholders	The Company has only Equity Shareholders and does not have any preference shareholders. Upon this scheme coming into efect, in consideration of the transfer of the Demerged Undertaking by the Demerged Company to the Resulting Company, in terms of this scheme, the Resulting Company shall, without any further act or deed, issue and allot to every member of the Demerged Company holding fully paid up equity shares in the Demerged Company and whose names appear in the Register of Members of the Demerged Company on the record date in respect of every 10 (Ten) Equity Shares of the face value of Rs. 10/- (Rupees Ten) each fully paid up held by him / her / it in the Demerged Company, 63 (Sixty-Three) new Equity shares of the Resulting Company of the face value of Rs.2/- (Rupees Two) each fully paid up.

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Sr. No.	Category of Stakeholder	Efect of the Scheme
(ii)	Promoters	There is no efect on the promoters of the Company and there is no change in the shareholding of the promoters.
(iii)	Non- Promoter Shareholders	There is no efect on the non-promoters of the Company and there is no change in the shareholding of the non- promoters.
(iv)	Key Managerial Personnel and Directors	Under part II point 8 of the Scheme, on and from the Efective Date, PAIL undertakes to engage the Employees of PIL, engaged in or in relation to the Demerged Undertaking, on the same terms and conditions on which they are engaged by PIL without any interruption of service and in the manner provided under part II point 8 of the Scheme. Under the Scheme, no right of the Employees of PIL of the remaining undertaking is being afected. The services of the Employees of PIL of the remaining undertaking, under the scheme, shall continue on the same terms and conditions on which they were engaged by PIL. There is no efect of the Scheme on the key managerial personnel and/or the Directors of PAIL. Further no change in the Board of Directors of the company is envisaged on account of the Scheme. The Key managerial Personnel and Directors of the Company (KMP’s) shall continue as Key Managerial Personnel and Directors of the Company after efectiveness of the Scheme. The KMP’s and Directors are shareholders of the Demerged Company hence; they will get shares of the Resulting company in the same ratio as mentioned in point no.(i) above.
(v)	Creditors / Public Depositors / Debenture holders	There is no efect on Creditors of the Company. There are no Public Depositors and Debenture holders in the Company and hence there is no efect on the same.

6. Valuation

• I. For the purpose of arriving at the share entitlement ratio, the valuation report was obtained in terms of the SEBI Circular No. circular No. CFD/DIL3/CIR/2017/21 dated March 10, 2017 and circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/215 dated 3rd November, 2020 read with Master circular no. SEBI/HO/CFD/DIL1/CIR/P/2020/249 dated 22nd December, 2020.

• II. The valuer has considered

• a. the value based on fair value of equity shares of PIL attributable to the Automotive / Tractor/ Engineering Components Business Undertaking of PIL.

• b. value based on fair value per equity share of PAIL.

• III. The valuer has also considered Market Price method (Market approach), Comparable Companies’ Multiples method / Guideline Company method (Income / Market approach) Net Asset Value method (Asset approach), Discounted Cash Flow Method by assigning appropriate weights.

• IV. On consideration of all the relevant factors and circumstances, the valuer has recommended a ratio of 63 (sixtythree) equity share of PAIL of INR 2/- each fully paid up for, not in exchange of, every 10 (ten) equity shares of PIL of INR 10/- each fully paid up and has been approved by the Audit Committee of Demerged Company and the Resulting Company.

• V. The Fairness opinion dated 14thAugust, 2021 was issued by Systematix Corporate Services Limited, a SEBI registered Merchant Banker, explaining the rationale for their opinion as to the fairness of the share entitlement ratio from a financial point of view.

• VI. The above share entitlement ratio has been arrived at on the basis of a relative valuation for the Demerged Undertaking and for each of the Companies based on the various qualitative factors relevant to each company

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and the business dynamics and growth potentials of the businesses of the Companies, having regards to information base, key underlying assumptions and limitations.

7.

No special valuation difficulties were reported

8. Adoption of Report by the Directors

The Directors of the Company have adopted this report after noting and considering information set forth in this report. The Board or any duly authorised committee by the Board is entitled to make relevant modification to this report, if required and such modifications or amendments shall be deemed to form part of this report

By Order of the Board For PritikaIndustries Limited

Sd/-

Harpreet Singh Nibber Director DIN: -00239042 Dated 14th August, 2021

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Annexure - 11

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Annexure - 12

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