Back
High Court Of Delhi
HIMACHAL TELEMATICS LIMITED - Appellant
Versus
HIMACHAL FUTURISTIC COMMUNICATIONS LIMITED - Respondent
Decided On : 02/29/1996
Held:
where Court is prima facie satisfied from material on record and on the opinion of Company Law Board or Department of Company Affairs that the affairs of the Company have been conducted in a manner which is not prejudicial to the interests of its members or of public interest, Court will sanction such scheme. A compromise or arrangement or a scheme of amalgamation may not be sanctioned by the Court if the affairs of the company are conducted in a manner prejudicial to the interest of its members or public interest. The objection raised before this Court pursuant to Section 42 of the Act is that as a consequence of the scheme of amalgamation, there would be violation as transfer of shares from subsidiary company to transferee company would result and the same would be hit by Section 42. That objection, which I will deal with later, is not an objection in public interest. If the scheme of amalgamation is inconsistent with other provisions of Companies Act, then the legislature in its wisdom ought to have added in the proviso to Section 394 afterwards public interest or anything inconsistent with other provision of this Act. That being not the situation, in the plain language of Section 394, the Court cannot permit the respondent to read further condition which has not been intended in the Section.
Rule of interpretation of a statute is that statute has to be read harmoniously. If there is no controlling provisions in the subsequent Sections of the Act, then no other meaning can be assigned to the language of a Section. Where a company is in the process of incorporation, Section 42 falls in that part of the Companies Act, which deals with incorporation of company and matters incidentel thereto. This part deals with Memorandum of Association, names of the companies, Article of Association, change of the registration of companies and Sections 41 and 42 deals with membership of the company. From the plain reading of the Section it cannot be said that this Section is intended to be read with Sections 391, 392 or 394 at the time when the scheme of amalgamation is pending before the Court for approval and when the shareholders and the creditors have approved the same and the respondent has also filed an affidavit that the affairs of the company are not conducted in a manner prejudicial to the shareholders or prejudicial to public interest.
Considering all the relevant facts and circumstances, the reasons set out by the petitioner in support of the amalgamation, the unanimous approval given by the shareholders and the creditors and in view of the aforesaid discussions and in absence of any objections from the Official Liquidator, I hereby accord sanction to the said scheme of amalgamation.
( 1 ) THIS is a petition under Sections 391 and 394 of the Companies Act, 1956 to sanction the scheme of amalgamation between M/s Himachal Telematics Limited (hereinafter REFERRED TO to as the "transferor Company") and M/s Himachal Futurisitc Communications Ltd. (hereinafter REFERRED TO to as the "transferee Company" ). The main object which is sought to be achieved by the proposed scheme of amalgamation is the combining of the multifarious activities presently being carried out by the two companies under separate umbrellas with a view to enable them to have greater control over the production and marketing function. The amalgamation scheme is for better and profitable utilisation of combined resources of both the companies and to present a consolidated projection to the investors. The scheme of amalgamation was approved by the equity shareholders as well as all classes of creditors i. e. secured and unsecured creditors of the transferor as well as transferee company. The scheme has already been approved by the High Court of Himachal Pradesh at Shimla vide order dt. 10. 1. 96 subject to scheme finally approved by this Court. No objection for scheme of amalgamation has been received from any shareholders or any class of creditors.
( 2 ) THE main objects of the petitioner/transferor company are primarily to maufacture of digital microwave Radios and also to carry on the business of designers, developers, manufacturers, sellers, buyers, importers, exporters, stockists and distributors and/or other dealers in telecommunication equipment and/or mass consumption terminal equipment etc. The authorised capital of the petitioner/transferor company as on 31st March, 1995 was Rs. 50,00,00,000 divided into 5,00,000 equity shares of RS. 10. 00 each and the paid up capital as on 31st March, 1995 was Rs. 24,23,07,000 divided into 2,42,50,000 equity shares of RS. 10. 00 each.
( 3 ) THE transferee company was incorporated on 11. 5. 1987 as a public limited company and is primarily engaged in the business of designers, manufacturers, assemblers, sellers, buyers, importers, exporters, stockists and distributors and/or other wise dealers in telecommunication equipment like electronic rural automatic, electronic private automatic branch exchange, transmission equipment, modems, integrate digital network systems, component, sub-system, wireless telephone, cellular radios, multiaccess rural radio telephone system with their accessories and associated equipment, all types of speech secrecy equipment, using various techniques, suitable for telephones, and radio communication equipment, fascimile systems, teleprinters, teletext and videotex systems, electronic typewriters and copying machines and subscriber carrier systems etc.
( 4 ) A copy of the scheme of amalgamation has been filed as Annexure e to this petition. The petitioner/transferor company filed an application bearing C. A. No. 587/95 under section 391 of the Companies Act, 1956 seeking a direction from this Court to convene and hold the meetings of the equity shareholders and secured and unsecured creditors for the purpose of considering and if thought fit approving with or without modifications the proposed scheme of amalgamation and to put it into effect. It is also mentioned in the petition that pursuant to the orders dated 21. 8. 1995 the High Court of Himachal Pradesh, Shimla, had directed the transfere company-HFCL to convene the meetings of their equity, preferential shareholders, secured and unsecured creditors for the purpose of considering and if thought fit approving with or without modifications the proposed scheme of amalgamation and to put it into effect.
( 5 ) THIS Court appointed Chairmen for conducting the meetings of the equity shareholders, secured and unsecured creditors of the Applicant Company. On 11th October, 1995 clubbed meetings of the shareholders and secured and unsecured creditors of the applicant company were duly held in accordance with the
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
