Authority: National Company Law Tribunal, Bengaluru Bench

Order Date: 09.10.2026

Case Overview

The petition was filed by Micro Labs Limited (Demerged Company/Petitioner Company No. 1) and Bahl and Company Private Limited (Resulting Company/Petitioner Company No. 2) under Sections 230-232 of the Companies Act, 2013 seeking sanction of a Scheme of Arrangement. The scheme involved demerging the entire financing and investment business of Micro Labs Limited and transferring it to Bahl and Company Private Limited on a 'going concern' basis effective from April 1, 2025 (Appointed Date).

The first motion order was passed on 18.11.2025 in CA (CAA) No. 45/BB/2025, where meetings of equity shareholders and unsecured creditors of the resulting company were dispensed with. Meetings were convened with secured and unsecured creditors of the demerged company, and the scheme was approved with requisite majority.

The Regional Director (South Western Region) raised significant objections based on an ongoing investigation into Micro Labs Limited. The Ministry of Corporate Affairs had ordered an investigation under Section 210(1)(c) of the Companies Act, 2013 vide order No. CL-II-13/7/2025-O/o DCoA-MCA dated 07.10.2025. The RD requested the Tribunal not to consider the scheme until the investigation was completed, citing public interest concerns.

The petitioner companies filed detailed replies arguing that: (1) the investigation was only against Micro Labs, not Bahl Company; (2) they had fully cooperated with investigators by submitting all required documents on 18.05.2026; (3) no adverse findings had been made against them; (4) the demerger was a bona fide internal reorganization between closely held family companies with common ownership and management; and (5) pendency of investigation alone should not bar scheme approval under settled legal principles.

The Reserve Bank of India also raised objections as Bahl and Company Private Limited is registered as an NBFC-ICC and had not obtained prior NOC as required under RBI's Voluntary Amalgamation Directions, 2025. The company subsequently applied for and received the NOC on 12.05.2026.

Both companies filed affidavits-cum-undertakings on 24.07.2026 committing to full cooperation with the investigation, making all records available, ensuring presence of directors/officers, and complying with any findings or directions from the investigation.

Final Outcome

The NCLT approved the Scheme of Arrangement with the Appointed Date of 01.04.2025. The scheme is binding on all directors, shareholders, and creditors of both companies. The Tribunal directed that: (1) certified copies be delivered to ROC Karnataka within 30 days; (2) companies comply with Section 314 of Income-tax Act, 2025; (3) records be preserved as per Section 239 of Companies Act; and (4) all undertakings given to statutory authorities be meticulously complied with. The approval expressly does not grant exemption from any stamp duty, taxes, or other liabilities.

Topics: Corporate Demerger, Regulatory Investigation, NBFC Compliance