NCLT Sanctions Scheme of Amalgamation involving Aditya Birla Fashion and Retail Limited and its Subsidiaries

NCLT Sanctions Scheme of Amalgamation involving Aditya Birla Fashion and Retail Limited and its Subsidiaries​

The National Company Law Tribunal (NCLT), Mumbai Bench, has sanctioned a Scheme of Amalgamation involving Aditya Birla Fashion and Retail Limited (ABFRL) and two subsidiaries, Jaypore E-Commerce Private Limited and TG Apparel & Decor Private Limited. The order was pronounced on July 2, 2026, finalizing the corporate restructuring process for the three entities.

The Scheme involves the amalgamation of the Amalgamating Companies—Jaypore E-Commerce Private Limited (which deals in linen, readymade garments, textiles, coated fabrics, jewellery, accessories and provides marketplace services) and TG Apparel & Decor Private Limited (a company currently not carrying any business activity)—into Aditya Birla Fashion and Retail Limited.

Both Jaypore E-Commerce Private Limited and TG Apparel & Decor Private Limited are wholly owned subsidiaries of ABFRL. The Boards of Directors of all three Petitioner Companies had approved the proposed Scheme during Board Meetings held on February 5, 2026.

Rationale for Amalgamation​

The amalgamation process aims to achieve several strategic benefits for the companies involved. These include simplification of the legal and operating structure, streamlining business and administrative operations, resulting in a reduction of associated costs. The overall benefit is described as seamless integration, leading to improved financial strength and flexibility for ABFRL, consequently maximizing shareholder value.

The appointed date set under the Scheme for the amalgamation is April 1, 2026.

Tribunal Reviews Statutory Compliance​

The NCLT determined that all necessary statutory compliances had been met before sanctioning the proposal. The tribunal perused reports and statements submitted by various authorities, including:

• Official Liquidator’s Report: The Official Liquidator filed a report noting that the affairs of both Amalgamating Companies (Jaypore E-Commerce Private Limited and TG Apparel & Decor Private Limited) had not been conducted in a manner prejudicial to public interest or the interest of creditors.
• Regional Director’s Report: After reviewing the Regional Director’s Report, the petitioner companies clarified that since the Scheme involved the holding company and its wholly owned subsidiaries, it was exempt from obtaining a No Objection Certificate from Stock Exchanges under relevant regulations. The regional director subsequently found the observations to be satisfactorily addressed.
• GST Authority Observations: The Tribunal considered the communication from the Central Goods and Services Tax Authority regarding an outstanding GST demand against TG Apparel & Decor Private Limited. Petitioners submitted a Rejoinder, explaining that the demand arose from an ex parte order, the tax liability had already been discharged, and an appeal was being preferred against the said order.

The Tribunal found the explanations and undertakings provided by the Petitioner Companies to be satisfactory and binding.

Consideration for Amalgamation​

Given that both Amalgamating Companies are wholly owned subsidiaries of ABFRL (the Amalgamated Company), the Scheme dictates that no financial consideration will pass from ABFRL upon effectiveness of the merger. Instead, all shares held directly by ABFRL in the Amalgamating Companies, along with nominees, will stand cancelled, as will the investment of ABFRL in those shares appearing in its books.

The NCLT found the Scheme to be fair and reasonable and concluded that no impediment remained for the sanctioning of the proposal. The Company Petition was consequently made absolute.

ABFRL Stock Price Movement​

Aditya Birla Fashion and Retail Limited's shares edged higher today, settling at ₹61.88 after gaining 5.68% in post-market trading. The stock saw robust activity during the session, with over 30.18 million shares traded.