In Re: Fetchus Finsec Ltd.; In Re: ... vs Unknown
2006 Latest Caselaw 1678 Del

ORDER

Sanjiv Khanna, J.

1. The above petitions coming up for hearing on 26.9.2006 for sanction of scheme of amalgamation proposed to be made of Fetchus Finsec Ltd. (hereinafter referred to as the transferor company) with Elymer Electric (P) Ltd. (hereinafter referred to as the transferee company), upon reading the said petitions, the order dated 7.7.2006 whereby the requirement of convening and holding the meetings of the shareholders and creditors of the transferor and transferee companies was dispensed with for the purpose of considering, and if thought fit, approving, with or without modificatiqn, the scheme of amalgamation annexed to the affidavit of Shri Ajesh Gupta, director of the petitioner companies, filed on 14 day of March 2006 and the publication in the newspapers namely (1) Statesman (English) dated 30.8.2006 and (2) Veer Arjun (I lindi) dated 31.8.2006 each containing the advertisement of the said petition and upon hearing Shri Sanjay K. Maria, Advocate, for the petitioner company, and Mr. R.D. Ka. shyap, Dy. Registrar of Companies, in person, andutpon reading the affidavit dated. 20.9.2006 of Shri Rakesh Chandra, Regional Director, Northern Region, I Ministry of Company Affairs, Noida, on behalf of Central Government whereby he raised four objections:

(1) That as per proposed scheme the authorized ware capital of the transferor I company shall be added to form part of the existing authorized share capital of t the transferee company. It is submitted that the authorized share capital of the traansferee company can be increased only after flowing the procedure pre-s scribed under the Act and on payment of requisite fee and stamp duty. The court 1 did not find any merit in this objection and rejected the same.

(2) That the proposed scheme provides that the main objects of the transferee Company shall be modified to include the business of the transferor company. It is submitted that memorandum and articles of association of the transferee company can be amended only after following the procedure prescribed under the 'ant provision of the Act including passing of special resolution by the member of the transferee company and filing of relevant form with the office of Registrar of Companies. Counsel for the transferee company stated that no amendment in the main objects of the transferee company is required and necessary and graph 12.3 in Part-V of the proposed scheme of amalgamation has been inserted as a matter of abundant caution. He further stated that in case any amendment to the main objects is required the transferee company shall follow the procedure prescribed under the Act. The court ordered that in view of the statement made by the counsel, which will be binding on the transferee company, objection has become infructuous. The court further ordered that in case amendment, modification or addition to the main objects of the transferee company is required, the transferee company shall follow the procedure prescribed under the provisions of Act and the rule.

(3) That the transferor company is a non-banking finance company registered with the Reserve Bank of India and it is not mentioned in the petition/scheme wether Reserve Bank of India has been informed about the proposed scheme of amalgamation. Counsel for the petitioner stated that the transferor company has taken any deposit from the public and has no creditors. He has also filed a liar dated 24.1.2006 issued by Reserve Bank of India. As per the said circular, Reserve Bank of India has relaxed its norms. The requirement to give prior for change in control of management of non-banking financial company in of merger, amalgamation and sanction by a High. Court order has been dispensed with. In terms of this said circular, non-banking finance companies are now required to inform Reserve Bank of India about merger and amalgamation within one month from the date of the sanction order passed by a High Court. Copy of the order is required to be sent to Reserve Bank of India. The petitioner will comply with the said circular. The court ordered that in view of the position explained by the counsel for the petitioner, this objection raised by the Regional Director is overruled.

(4) Regional Director has pointed out that in the prayer clause of the petition filed by the transferee company, it is prayed that the scheme of amalgamation may be sanctioned so as to be binding with effect-from 1 April 2004, whereas in the scheme of amalgamation, the appointed date has been fixed as 1 April 2005. Counsel for the petitioner companies stated that there is a typographical error in prayer clause of the petition filed by the transferee company and the year 2004 should be read as 2005. It is stated that [the] appointed date as mentioned in the scheme of amalgamation is 1 April 2005. Counsel for the petitioner companies has been permitted to carry out necessary correction in the prayer clause of Company Petition No. 187/2006. As per the said correction, the appointed date is 1 April 2005 and the said correction has been initialed by the counsel. In view of the above, the court did not find any merit in the objection and overruled the same; and considering the affidavit of Shri A.K. Chaturvedi, official liquidator, filed on 23.9.2006 stating therein that the affairs of the transferor company have not been conducted in a manner prejudicial to the interest its members or to public interest; and there being no investigation proceedings pending in relation to the petitioner company under Sections 235 to 251 of the Companies Act, 1956.

2. This Court doth hereby sanction the scheme of amalgamation set forth in Schedule-I annexed hereto and doth hereby declare the same to be binding on all the shareholders and creditors of the transferor and transferee companies and all concerned and doth approve the said scheme of emalgamation with effect from the appointed date, i.e., 1.4.2005.

2.1 And this Court doth further order:

1. That all the property, rights and powers of the transferor company specified in the First, Second and Third Parts pf the Schcdule-II hereto and all other property, rights and powers of the transferor company be transferred without further act or deed to the transferee company and accordingly, the same shall pursuant to Section 394(2) of the Companies Act, 1956 be transferred to and vest in the transferee company for all the estate and interest of the transferor company therein but subject nevertheless to all charges now affecting the same; and

2. That all the liabilities and duties of the transferor company be transferred without further act or deed to the transferee company and accordingly the same shall pursuant to Section 394(2) of the Companies Act, 1956 be transferred to and become the liabilities and duties of the transferee company; and

3. That all the proceedings now pending by or against the transferor company be continued by or against the transferee company; and

4. That the transferee company do[es] without further application, allot to such members of the transferor company as have not given such notice of dissent as is required by clause 11 of Part IV given in the scheme of amalgamation herein the shares in the transferee company to which they are entitled under the said amalgamation; and

5. That the transferor company do within 30 days after the date of this order cause a certified copy of this order to be delivered to the Registrar of Companies for registration, and on such certified copy being so delivered, the transferor company shall be dissolved without the process of Winding up and the Registrar of Companies shall place all documents relating to the transferor company, and registered with him on the file kept by him in relation to the transferee company and the files relating to the said transferor and transferee compares shall be consolidated accordingly; and

6. That any person interested shall be at ljberty to apply to the court in the above matter for any directions that may be necessary.