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IN THE HIGH COURT OF KARNATAKA AT BANGALORE
Ram Mohan Reddy, J.
In Re: Hindhivac Private Limited and another —Respondent
Company Petitions No. 15 and 16 of 2005
Decided on : 04-07-2005
Amalgamation - Companies Act, 1956 - Section 17, Section 391-394
Fact of the Case:
The petitions seek sanction of the scheme of amalgamation between M/s Hindhivac Private Limited and M/s Hind High Vacuum Company Private Limited. Both companies sought approval from the court and obtained consent from their shareholders and creditors for the proposed scheme.
Finding of the Court:
The court found that the scheme of amalgamation was beneficial to the companies and their stakeholders. The court also addressed objections raised by the Regional Director of Company Affairs and ultimately sanctioned the scheme of amalgamation, ordering the dissolution of the transferor company without winding up.
Issues: The main issue revolved around the power of the transferor company to amalgamate without specific provisions in its memorandum of association, as raised by the Regional Director of Company Affairs.
Ratio Decidendi: The court held that the power of the companies to amalgamate may flow either from the objects in their memorandum or may be acquired by resort to Section 391 to 394 of the Act. The court also emphasized that the interest of the shareholders and employees was adequately addressed in the proposed scheme.
Final Decision: The court sanctioned the scheme of amalgamation, ordered the dissolution of the transferor company without winding up, and directed the petitioners to serve a copy of the order on the Registrar of Companies within 30 days.
Ram Mohan Reddy, J.—In both these petitions, petitioners seek sanction of the scheme of amalgamation, Annexure-A. Hence, these petitions are clubbed, heard together and are being disposed of by this common order.
2. The petitioner in Company Petition No. 15/05 is M/s Hindhivac Private Limited (for short the 'transferee company'), a company, incorporated on 26.3.2001 under the Companies Act, 1956, for short 'Act', having its registered office at Site No. 17. Phase 1, Peenya Industrial Area, Bangalore-58.
3. The main objects of the transferee company is to carry on business to take over the vacuum systems and pumps division of the company known as M/s Hind High Vacuum Company Private Limited together with its assets and liabilities under a scheme of amalgamation, amongst other objects set out in the Memorandum of Association, Annexure-B.
4. The authorised share capital of the transferee company is Rs. 2,00,00,000/- (Rs. two crores only) divided into 2,00,000 equity shares of Rs. 10/- each, while issued, subscribed and paid up share capital of Rs. 1,23,08,270/- (Rs. One crore twenty three lakh eight thousand two hundred and seventy) divided into 12,30,827 equity shares of Rs. 10/- each fully paid up.
5. The latest audited Balance Sheet, Annexure-C, made up to 31.3.2004, duly certified by the auditors of the Transferee Company discloses its assets and liabilities. The Board of Directors of the transferee company approved and adopted the scheme of amalgamation, Annexure-A, whereunder M/s Hind High Vacuum Company Private Limited, a company incorporated on 9.4.1965, under the Act (for short the 'transferor company') having its registered office at Site No. 17, Phase 1, Peenya Industrial Area, Bangalore-58 is proposed to be merged with the transferee company subject to confirmation by this Court. The vacuum system and pumps division of the transferor company was demerged and taken over by the Transferee company under a scheme of arrangement, which received the sanction of this Court by Order dt. 2.7.2002 in Company Petitions 16 and 17 of 2002. The transferee Company made an application in C.A. No. 924/04 seeking permission of this Court to convene and hold the meeting of its shareholders and creditors to consider the scheme of amalgamation, Annexure-A. This Court, by order dt. 19.11.2004 and 17.12.2004 allowed the applications and granted permission as sought for. Accordingly, meetings of the shareholders and creditors of the transferee company were convened and held on 17.1.2005, at its registered office. All the shareholders and creditors of the transferee company, who attended the meeting, unanimously approved the scheme of amalgamation, Annexure-A, as is evident from the report of the Chairman, Annexure-G The transferee company has presented this Company petition seeking the imprimatur of this Court for the scheme of amalgation, Annexure-A.
6. The petitioner company in CO.P. 16/04 is M/s Hind High Vacuum Company Private Limited, the transferor company.
7. The main objects of the Transferor company is to carry on business of manufacture of scientific instruments, industrial apparatus, etc., amongst other objects as set out in Memorandum of Association, Annexure-B.
8. The authorised share capital of the transferor company is Rs. 3,00,00,000 (Rs. three crore) divided into 30,00,000 equity shares of Rs. 10/- each, while the issued, subscribed and paid up capital is Rs. 1,32,33,780/- (Rs. One crore thirty-two lakh thirty three thousand seven hundred and eighty only) divided into 13,23,378 equity shares of Rs. 10/- each fully paid up.
9. The transferor company has produced the balance sheet at Annexure-C, made up to 31.3.2004 duly certified by the auditors of the Transferor company discloses its assets and liabilities.
10. The Board of Directors of the Transferor Company in its meeting held on 14.10.2004 approved and adopted the scheme of amalgamation, Annexure-A by which the Transferor Company is proposed to be merged with the transferee c
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