In Re: Advance Plastics P. Ltd.; In ... vs Unknown
2007 Latest Caselaw 716 Bom

JUDGMENT

D.B. Bhosale, J.

1. The sanction of the court is sought to a scheme of amalgamation under Sections 391 to 394 of the Companies Act, 1956.

2. Mr. Shah, learned Counsel appearing for the petitioner, has stated before the court that in so far as the transferor company is concerned : (i) all the equity shareholders have granted their consent; (ii) there are no secured or unsecured creditors and in view thereof convening and holding of a meeting of the equity shareholders of the transferor company for the purpose of considering the scheme of amalgamation between the transferor company and the transferee company under Sections 391 to 394 of the Companies Act was dispensed with.

3. In so far as the transferee company is concerned, the court has been informed by learned Counsel for the petitioner that all the shareholders have granted their consent and there are no secured or unsecured creditors. In view thereof convening and holding a meeting of the equity shareholders of the transferee company for the purpose of scheme of amalgamation was dispensed with.

4. The Regional Director has filed an affidavit and in paragraph 6 thereof raised an objection stating that as per Clause 12.1 of the scheme shares will be issued by the transferee company to the members of the transferor company. But objection of Scheme of amilagtion was that no valuation report was submitted by the petitioner-company in respect of exchange ratio arrived at for such issue of shares by the transferee company to the members of the transferor company. The petitioner, submitted that except one shareholder, who held hardly 50 shares of the transferor company, all the shareholders in both these companies where the same further submitted that there were no secured and unsecured creditors and all the shareholders hasl given their consent for the scheme. Raised in paragraph 6. Regional Director ha stated that the scheme as proposed 1fiotcbntrary to the public interest or prejudicial to the interest of the shareholders or creditors. The shares a were the properties of the shareholders and they were the ultimate and the best judge of the value they would put on their charges. There was no requirement in the Companies Act that in such a case the ratio of exchange had to be determined on a valuation made by a chartered accountant and auditor. In the present case, no shareholder had challenged the amalgamation. In the circumstances, valuation report was not necessary.

5. The official liquidator has stated in his affidavit dated June 12, 2007, that the affairs of the transferor company have been conducted in a proper manner and not prejudicial to the interest of its members or the public interest.

6. There is no objection to the scheme and all the requisite statutory compliances have been fulfilled. Company Petition No. 806 of 2006, is made absolute in terms of prayer Clauses (a) to (d).

7. Company Petition No. 807 of 2006, is made absolute in terms of prayer Clauses (a) to (d).