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2016 Supreme(Del) 873
IN THE HIGH COURT OF DELHI AT NEW DELHI
SUDERSHAN KUMAR MISRA, J.
Bali Projects Private Limited – Petitioner/Transferor Company
Versus
Ramesh Aggarwal & Associates Private Limited – Petitioner/Transferee Company
COMPANY PETITION NO. 213/2015
Decided On : 18-02-2016
Mr. P.K. Mittal and Mr. M.K. Sinha, Advocates for the petitioners.
Ms. Aparna Mudiam, Assistant Registrar of Companies for the Regional Director, Mr. Rajiv Bahl, Advocate for the Official Liquidator.
The main legal point established in the judgment is that the court has the authority to grant sanction to a Scheme of Amalgamation under Sections 391 and 394 of the Companies Act, 1956, based on the approval of the scheme by the concerned parties and compliance with statutory requirements.
Headnote:
Companies Act - Amalgamation - Sections 391, 394 - Summary of Acts and Sections: The court discussed Sections 391 and 394 of the Companies Act, 1956 in the context of the joint petition seeking sanction of the Scheme of Amalgamation. The court highlighted the share exchange ratio, approval of the scheme by the Board of Directors, compliance with statutory requirements, and the dissolution of the transferor companies without winding up.
Fact of the Case:
The joint petition was filed under Sections 391 & 394 of the Companies Act, 1956 seeking sanction of the Scheme of Amalgamation of multiple companies with another company. The petitioners claimed that the Scheme would result in pooling of resources, economies of scale, and enhanced capabilities for the transferee company.
Finding of the Court:
The court found that the proposed Scheme of Amalgamation was approved by the Board of Directors of the involved companies and that there were no objections from the Regional Director, Northern Region, and the Official Liquidator. Consequently, the court granted sanction to the Scheme of Amalgamation under Sections 391 and 394 of the Companies Act, 1956.
Issues: The main issue was to seek the court's sanction for the Scheme of Amalgamation under Sections 391 and 394 of the Companies Act, 1956.
Ratio Decidendi: The court's decision was based on the approval of the scheme by the concerned parties, absence of objections, and compliance with statutory requirements.
Final Decision: The court granted sanction to the Scheme of Amalgamation under Sections 391 and 394 of the Companies Act, 1956, and directed the petitioner companies to comply with the statutory requirements within 30 days.
SUDERSHAN KUMAR MISRA, J.
1. This joint petition has been filed under Sections 391 & 394 of the Companies Act, 1956 by the petitioner companies seeking sanction of the Scheme of Amalgamation of Bali Projects Private Limited (hereinafter referred to as the transferor company no. 1); Decowel Housing Private Limited (hereinafter referred to as the transferor company no. 2); and Himal Projects & Investments Private Limited (hereinafter referred to as the transferor company no. 3) with Ramesh Aggarwal & Associates Private Limited (hereinafter referred to as the transferee company).
2. The registered offices of the transferor and transferee companies are situated at New Delhi, within the jurisdiction of this Court.
3. The transferor company no. 1 was incorporated under the Companies Act, 1956 on 11th July, 1994 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.
4. The transferor company no. 2 was incorporated under the Companies Act, 1956 on 11th July, 2000 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.
5. The transferor company no. 3 was incorporated under the Companies Act, 1956 on 2nd August, 1995 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.
6. The transferee company was incorporated under the Companies Act, 1956 on 5th March, 1992 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.
7. The present authorized share capital of the transferor company no.1 is Rs.15,00,000/- divided into 1,50,000 equity shares of Rs.10/- each. The present issued, subscribed and paid-up share capital of the company is Rs.9,60,000/- divided into 96,000 equity shares of Rs.10/- each fully paid up.
8. The present authorized share capital of the transferor company no.2 is Rs.40,00,000/- divided into 4,00,000 equity shares of Rs.10/- each. The present issued, subscribed and paid-up share capital of the company is Rs.39,02,000/- divided into 3,90,200 equity shares of Rs.10/- each fully paid up.
9. The present authorized share capital of the transferor company no.3 is Rs.70,00,000/- divided into 70,000 equity shares of Rs.100/- each. The present issued, subscribed and paid-up share capital of the company is Rs.68,82,000/- divided into 68,820 equity shares of Rs.100/- each fully paid up.
10. The present authorized share capital of the transferee company is Rs.3,00,00,000/- divided into 30,00,000 equity shares of Rs.10/- each. The present issued, subscribed and paid-up share capital of the company is Rs.3,00,00,000/- divided into 30,00,000 equity shares of Rs.10/- each fully paid up.
11. Copies of the Memorandum and Articles of Association of the transferor and transferee companies have been filed on record with the joint application, being CA(M) 38/2015, earlier filed by the petitioners. The audited balance sheets, as on 31st March, 2014, of the transferor and transferee companies, along with the report of the auditors, had also been filed.
12. A copy of the Scheme of Amalgamation has been placed on record and the salient features of the Scheme have been incorporated and detailed in the petition and the accompanying affidavit. It is submitted by the petitioners that the shareholders of the transferor and transferee companies are almost common. It is claimed that the Scheme will result in pooling of their financial, commercial and other resources, economies of scales and reduction of overheads. It is further claimed that with enhanced capabilities and resources at its disposal, the transferee company will have greater flexibility and strength to meet requirements for further growth of business activities.
13. So far as the share exchange ratio is concerned, the Scheme provides that, upon coming into effect of this Scheme, the transferee company shall issue and allot equity shares to the shareholders of the transferor companies in the following ratio:-
“01 equity share of Rs.10/- each of the transferee company, credited as fully paid up, for every 2.5 equity shares of Rs.10/-
