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TMI Blog2023 (1) TMI 1192X X X X Extracts X X X X X X X X Extracts X X X X ..... ce on the order of the Hon'ble NCLAT dismissing the appeal filed by the RoC in a connected matter, which was based on identical facts and documents. In view of the same, it is pressed upon this Bench that the aforesaid decision of the Hon'ble NCLAT upholding the decision of this Bench in the matter of ROC V/s. M/s. Apoorva Leasing Finance And Investment Company Ltd. squarely covers the facts of this case and hence applicable. Ld. Counsel for the RoC confirms that the dismissal of the appeal by the Hon'ble NCLAT on the point of sanction would be applicable in the present case also. Dismissal of the petition of grounds of lack of sanction having been upheld, the present petition is also dismissed." 3. The facts giving rise to this Appeal are as follows: i) The Appellant filed a winding up petition being CP No. 172/271-272/ND/2018 against M/s Sri Amarnath Finance Ltd. (Respondent herein) before the NCLT, New Delhi on the basis of the SFIO Report dated 31.03.2016 after fulfilling all the legal requirements and with the permissions of the Central Govt. and prayed for the winding up of the Respondent Company by invoking the provisions contained in Sections 271 and 272 of the Compani ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties of the persons who are behind the whole trail of investments/web of cross investments in various companies could not be found out. f. All the companies and persons involved appear to be working in concert to create share capital, share application money, share premium and reserves and surplus in these companies just by creating accounting entries and circular transactions. Accounting entries thus created, are sought to be wrapped/adjusted by way of scheme of amalgamation. g. The allotment of large number of shares on a hefty premium without any justifiable business seems to be deliberate attempt to avoid payment of fees to the govt. exchequer under schedule X on increase in paid up share capital and authorized share capital. h. The transferee company is a listed company and out of the total 720 shareholders, 83% are individuals and the remaining 17% are body corporates. The scheme of amalgamation would result in drastic fall in individual shareholding and adversely affect the vital public interest. iv) The Ministry of Corporate Affairs, Govt. of India vide order F. No. 04/181/2013-CL.II (NR) dated 28.10.2013 in exercise of its powers under Section 235 of the Companies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder their control. The Investigation revealed that Jain Brothers were the 'Directing mind and will' behind the functioning of all 49 companies including the Respondent herein. The observation made during the investigation are summarized as under to substantiate the above statement:- a) The primary records in the form of daily cash books and mediator ledgers for the period from January 2005 to August 2010 seized by the ITD, have been validated by the SFIO team through the bank statements of the concerned companies. The meticulous record keeping reveals that cash book were maintained by Jain brothers in a unified manner for all the entities under their control. The opening/closing balances shown in the cash books reflect joint opening/closing balance for the entire set of entities. The unified record keeping system has also established the nature of business conducted by Jain Brothers, which could be carried out only with the combined efforts made thorough all the entities. b) The consolidated account keeping revealed the fact that this particular business cannot be conducted by separate entity independently but requires the simultaneous assistance of a multiple entities working ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... show regular conversation between Rajesh Aggarwal & S.K. Jain, Ravinder Goel & Rajesh Aggarwal and Sant Lal Aggarwal & Rajesh Aggarwal, though these persons have denied to have been in touch with each other. j) Admission made by Rajesh Aggarwal during search at his residence by the ITD on 18.01.2011 regarding role played by him in mediating transactions between Jagat Projects Ltd. and Jain Brothers at the behest of Ravinder Goel. k) Within a short span of time, the share allotted to SHL, USPL & Sohpl were bought back by relatives and associates of Directors of Jagat Projects Ltd. at heavily discounted price, completing the full cycle of regaining control over the company from outside entities. l) Though the modus operandi is explained with these specific cases as per the specific leads received form the income tax proceedings, the same are also true for all other beneficiaries and mediators, the transaction details of which are recorded in the primary records seized by the ITD. vii) The Modus-Operandi of M/s NKS Holdings Limited have been detailed in the investigation report of the SFIO from Para No. 4.1.20 to 4.1.30 explaining how the Jain Brothers have been rotating the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Liquidator appointed by the Hon'ble Tribunal. d. Direct the respondents to maintain status quo in respect of the properties of the company and the respondent company be prohibited from dealing with the funds of the company except with the prior permission of this Hon'ble Tribunal. e. Restrain the respondent company from dealing and transacting in any manner, whatsoever with the movable and/or immovable assets of the company and its Bank Accounts. After hearing the parties, the Tribunal dismissed the aforesaid winding up petition and passed orders (supra). Hence this Appeal. 4. The Ld. Counsel for the Appellant during the course of argument relied on the grounds mentioned in the memo of Appeal and also written submissions filed in Company Appeal (AT) No. 105 of 2020 which has been adopted in this Appeal and submitted that the impugned order dated 03.02.2020 passed by the Tribunal is illegal, unreasonable and against the well settled principles of law. The Tribunal has also failed to appreciate that a company which has a high premium in its books of accounts brought in by the Jain Brothers which still existed and carried forward is one of the traits of a shell company. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the purpose of addressing the Director, SFIO was only to request him to assist the ROC to file the winding up petition be deputing the concerned IO who had conducted the investigation. Further, there is no any prescribed format for granting sanction in a particular manner. The word sanction means official permission. In the present case, petitioner has not filed a winding up petition against the Respondent company without the permission of the Central Govt. The letter dated 29.08.2017 which is, in fact, a sanction letter has been issue dafter considering the notices and replies from the Respondent company. Since there is nothing in the reply of the Respondent except the request for the copy of the SFIO report, therefore, it was not considered necessary to give personal hearing to the Respondent company. 7. It is further submitted that the Tribunal unreasonably considered those points while passing the impugned order which should not have taken into consideration as per law. The Tribunal mentioned in the order that the criminal prosecution has not culminated in holding the Respondent company guilty or for that reason, even ordained conviction of the Jain Bros. It was further men ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Company Limited" and is now upheld by this Appellate Tribunal comprising of Hon'ble three Member Bench in Company Appeal (AT) No. 88 of 2019 vide order dated 04.12.2019 which read hereunder: "15. This sanction order does not contain what are the allegations against the Respondent No.1 company and to substantiate the allegations what documents were placed before him. It is also not mentioned that before according sanction the company has been given reasonable opportunity of making representations. It is also not mentioned that the sanctioning authority prima facie satisfied with the allegations against the Respondent No.1 company. In this regard it is useful to cite the judgement of Punjab & Haryana High Court in the case of ROC Vs Suraj Bachat Yojna Pvt Ltd and Others 1973 (43) Comp Case 343. Though this case was under the old Act, 1956 but in substance the provisions of the new Act, 2013 are same. "5.xxxxx The legislature enacted a safeguard for the companies not to be harassed by frivolous or doubtful-of-success petitions for its winding-up by the Registrar in Section 439(6) of the Act by enjoining on the Central Government not to accord its sanction to the Registrar u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the case of the Respondent is fully covered by this Judgment which have attained finality as the Civil Appeal has also been dismissed by the Hon'ble Supreme Court, therefore, there is no merit in the Appeal, the instant Appeal may be dismissed. 12. After hearing the parties and going through the pleadings made on behalf of the parties and also the Judgment passed by Hon'ble three Member Bench of this Tribunal in the case of "Registrar of Companies Vs. Apoorva Leasing Finance & Investment Company Limited [Company Appeal (AT) No. 88 of 2019] dated 04.12.2019" which has attained finality as the Civil Appeal has also been dismissed by the Hon'ble Supreme Court in "Civil Appeal Diary No. 14952 of 2020 (Union of India Vs. Apoorva Leasing Finance and Investment Co Ltd. and Another)", we find that facts of the instant Appeal are same and identical to the case which was dismissed by this Appellate Tribunal vide order dated 04.12.2019 in the case of "Registrar of Companies Vs. Apoorva Leasing Finance & Investment Company Limited and Another". Therefore, we are of the view that there is no merit in the Appeal, the instant Appeal is hereby dismissed. 13. Registry to upload the Judgment on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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