NCLT Delhi Clears DCM Shriram's Scheme to Reorganise Its Businesses

The National Company Law Tribunal (NCLT) at New Delhi has approved a composite amalgamation and demerger scheme for DCM Shriram Industries and three group entities The bench of Judicial Member Ashok Kumar Bhardwaj and Technical Member Ravindra Chaturvedi cleared the plan on November 21, 2025 while making it clear that the tax department's recovery rights remain untouched and that any default in paying outstanding dues would render its sanction non-existent. The scheme provides for the merger of its financial services arm Lily Commercial Private Limited into DCM Shriram Industries Limited (DCMSR) and the subsequent demerger of DCMSR's chemical and rayon undertakings into two new companies, DCM Shriram Fine Chemicals Limited and DCM Shriram International Limited, effective 1 April 2023. All assets, liabilities and employees will shift to the transferee and resultant companies. The group said the restructuring would allow business focus and improve operational efficiency. Shareholder and creditor approvals were overwhelmingly in favour, with reports filed on April 4, 2025 showing 99.9999% of equity shareholders and 100% of unsecured creditors by value supporting the scheme. Only 32 public shareholder votes were cast against it. During the second-motion stage, statutory authorities raised limited concerns. The Regional Director pointed to some discrepancies in the FY24 audit, losses in the resultant entities and a pending lease deed with the Gujarat Industrial Development Corporation. The Income Tax Department reported outstanding dues of about Rs 27.16 crore. The companies said these issues had no impact on the appointed date balances and that lease discussions were ongoing. Finding no sustainable objection, the tribunal sanctioned the scheme but imposed safeguards.If the Gujarat Industrial Development Corporation ultimately refuses to execute the lease, the Regional Director may approach the NCLT again, and the resultant entity must revise its financials within 30 days. The tribunal clarified that the scheme does not confer any tax benefit and does not dilute the department's recovery powers. The companies must file certified copies of the order with the Registrar of Companies within 30 days for the scheme to take effect. Case Title: In the Matter of Composite Scheme of Arrangement of Lily Commercial Private Limited and Ors. Case Number: CP (CAA)-17/ND/2025 with CA (CAA) 103/ND/2024 For Petitioner : Advocates Saurabh Kalia, Anirudh Das, and Aditya Kumar SinghClick Here To Read/Download Order

NCLT Delhi Clears DCM Shriram's Scheme to Reorganise Its Businesses

Shivangi Bhardwaj

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