2023 (1) TMI 1289 - HC - Companies Law

Change in the share holding of the allottee company - liability to pay Change in the Share Holding Charges (CIS charges) as per the policy of Greater NOIDA dated 13.7.2021 - HELD THAT - In view of the categorical stand of the petitioner in the writ petition which could not be successfully refuted by the respondent Greater NOIDA we are required to take note of Clause 3.4 of the transfer policy of Greater NOIDA issued by the office order dated 13.7.2021 - In view of the provision in Clause 3.4 of the policy no CIC charges can be demanded from the petitioner company in view of the established stand of the petitioner that it was merely a change in the name of the original allottee/leasee company and there is no change in the ownership or share holding of the allottee company. The demand notice dated 14.06.2021 is found illegal contrary to the own policy of the Greater NOIDA promulgated by the office order dated 13.7.2021. As there is no justification for demand of CIC charges while quashing the demand notice the writ petition is allowed.

Summary

Issues Involved:
Challenge to demand notice for 'Change in the Share Holding Charges' by the Manager (Industries), Greater NOIDA based on a change in the shareholding of the allottee company.

Analysis:
The petitioner, originally incorporated as M/s Bayer Industries Pvt Ltd in 1995, changed its name to M/s Bayer Material Science Pvt Ltd in 2004 following due process of law. The plot was allotted to the new entity for manufacturing 'Formulated Polyois'. Subsequently, in 2015, the company changed its name to 'Covestro (India) Pvt Ltd' as part of the global mandate. The petitioner maintained that despite the name changes, the business, products, and shareholding pattern remained consistent. The petitioner argued that the demand notice for 'Change in the Share Holding Charges' was unjustified as it was a case of a name change, not a transfer of ownership. The petitioner's position was supported by the lease records and the shareholding comparison.

In response, Greater NOIDA admitted recording the name change in its records as per the lease deed terms. However, there was a dispute regarding the alleged change in the shareholding percentage of the original company. The petitioner contended that no significant alterations occurred in the shareholding of the current company. Notably, the transfer policy of Greater NOIDA, as per Clause 3.4, stated that if there is only a change in name without altering ownership/shareholding, no 'Change in the Share Holding Charges' shall apply. The court emphasized that the demand notice was illegal and contrary to the policy, as there was no change in ownership or shareholding of the allottee company. Consequently, the demand notice was quashed, and the writ petition was allowed without costs.