Sony Mobile Communications ... vs --
2013 Latest Caselaw 3156 Del

$~24
* IN THE HIGH COURT OF DELHI AT NEW DELHI

                                        Date of decision: 23rd July, 2013

+              COMPANY PETITION NO: 170 of 2013

Sony Mobile Communications (India) Private Limited & Anr
                                                       ....Petitioners

                           Through: Mr. Abhishek Seth, Mr. Abhijit
                           Singh, Mr. Rajeev Kumar and Mr. Rahul Raj,
                           Advocates for the Petitioner
                           Mr. Pradhan, Dy. Registrar of Companies for
                           the Regional Director
                           Mr. Rajiv Bahl, Advocate for the Official
                           Liquidator

CORAM:
HON'BLE MR. JUSTICE R.V.EASWAR

R. V. EASWAR, J.: (ORAL)

1.

This second motion joint petition has been filed under Section 391 to

394 of the Companies Act, 1956 ('Act') by the Petitioner seeking

sanction of the Scheme of Amalgamation ('Scheme') between Sony

Mobile Communications (India) Private limited (hereinafter referred

to as 'Transferor company') and Sony India Private Limited

(hereinafter referred to as 'Transferee company') ("hereinafter

collectively referred to as 'Petitioner companies').

2. The registered offices of the Petitioner companies are situated in

New Delhi, within the jurisdiction of this Court.

3. The details of the dates of incorporation of the Petitioner companies,

their authorized, issued, subscribed and paid up capital have been set

out in the petition.

4. The copies of the Memorandum and Articles of Association as well

as their latest audited annual accounts for the year ended 31st March

2012 of the Petitioner companies have also been placed on record.

5. The copies of the resolutions passed by the Boards of Directors

('BoDs') of the Petitioner companies approving the Scheme have

also been enclosed with the petition.

6. Learned counsel for the Petitioners submits that no proceedings

under Sections 235 to 251 of the Act are pending against the

Petitioner companies.

7. So far as the share exchange ratio for amalgamation is concerned,

the Scheme provides that:-

"Transferee company shall without any further act or deed, issue and allot 275 („Two Hundred Seventy-five‟) fully paid up equity shares of Rs 10/- each in its share capital for every 2 („Two‟) fully paid equity shares of Rs. 10/- each held in Transferor company to the members of Transferor company on a proportionate basis holding fully paid up equity shares in Transferor company".

8. The Petitioner companies had earlier filed CA (M) No 37 of 2013

in this Court seeking directions for dispensation of the

requirements of convening the meetings of the shareholders and the

unsecured creditors of the Petitioner companies. By order dated 8 th

April 2013, this Court allowed the application and dispensed with

the requirements of convening their meetings.

9. The Petitioner companies have thereafter filed the present petition

seeking sanction of the Scheme. By order dated 16 th April 2013,

notice in the petition was directed to be issued to the Regional

Director ('RD') and the Official Liquidator ('OL'). Citations were

also directed to be published in 'The Indian Express' (English) and

'Dainik Jagran' (Hindi). An affidavit of service and publication

dated 15th May 2013 has been filed showing compliance regarding

service of the petition on the RD, the Registrar of Companies

('ROC') and the OL, and also regarding publication of citations in

the aforesaid newspapers. Copies of the newspaper cuttings, in

original, containing the publications have been filed along with the

said affidavit.

10. Pursuant to the notices issued, the OL sought information from the

Petitioner companies. Based on the information received, the OL

has filed his report wherein he has stated that he has not received

any complaint against the proposed Scheme from any person/party

interested in the Scheme in any manner and that the affairs of the

Petitioner companies do not appear to have been conducted in a

manner prejudicial to the interest of its members, creditors or to

public interest.

11. In response to the notices issued, the RD has filed his affidavit

dated 19th July 2013. Relying on the Scheme, he has stated that

upon sanction of the Scheme, all the employees of the Transferor

company shall become the employees of the Transferee company

without any break or interruption in their services upon sanctioning

of the Scheme. Further, in Para 5 of the said affidavit, the RD has

observed that the exchange ratio has been determined by M/s TXN

Advisory Services LLP, which does not appear to be firm of

Chartered Accountants.

12. In response to the RD affidavit, Mr. Sanjay Bhargava, authorized

signatory of the Petitioner companies has filed an affidavit dated

20th July 2013 wherein it is stated that M/s TXN Advisory Services

LLP is a firm having professionals comprising of chartered

accountants and finance experts and are eminently qualified along

with rich experience in these fields.

Further, it is stated that the valuation team at TXN is headed

by Mr. Manish Khanna, who is a Chartered Accountant and

Company Secretary by profession/qualification and has prepared

and signed the valuation report determining the exchange ratio. Mr

Manish Khanna is a member of the Institute of Chartered

Accountants of India having the Membership No: 506656.

Further, all the shareholders of the Petitioner companies and

the respective BoDs have given their consent to the proposed share

exchange ratio indicated in the valuation report. Moreover, since

100% effective holding of the Petitioner companies ultimately

being with the same entity i.e. Sony Corporation, Japan, any share

exchange ratio is fair and reasonable from the point of view of

ultimate equity shareholder's interest for the amalgamation.

In view of the above said clarification, the observations

made by the RD no longer survive.

13. Further, the RD in Para 6 of his affidavit has observed on perusal

of the shareholding pattern of the Transferor company that all its

shares are held by foreign companies viz. M/s Sony Mobile

Communications International AB, Sweden and M/s Sony Mobile

Communications AB, Sweden. Similarly, on perusal of the

shareholding pattern of the Transferee company, it has been

observed that all its shares are held by foreign companies viz. M/s

Sony Overseas Holdings (Asia) B.V. and M/s Sony Middle East &

Africa FZE. Further, in Para 6.1 of the said affidavit the RD has

stated that the Petitioner Transferee company may be asked to give

an undertaking for all compliances from the Reserve Bank of India

('RBI') as required under FEMA.

14. In response to the aforesaid observation, it is undertaken by the

Transferee company that it will comply with all the applicable

Rules and Regulations of RBI as required under FEMA.

In view of the above said clarification, the observations made by

the Regional Director no longer survive.

15. No objection has been received to the proposed Scheme from any

other party. Mr. Sanjay Bhargava, authorized signatory of the

Petitioner companies, has filed an affidavit dated July 19, 2013

confirming that the Petitioner companies have not received any

objection pursuant to citations published in the said newspapers.

16. In view of the approval accorded by the shareholders and creditors

of the Petitioner companies, representation/reports filed by the RD

and the OL, and no objections received to the proposed Scheme,

there appears to be no impediment to grant of sanction to the

Scheme. Consequently, sanction is hereby granted to the Scheme

under Sections 391 and 394 of the Act. The Petitioner companies

will comply with the statutory requirements in accordance with

law.

17. The certified copy of the order will be filed with the ROC within

30 days from the date of receipt of the same. In terms of Sections

391 and 394 of the Act and in terms of the Scheme, the whole of

the undertaking, the property, rights and powers of the Transferor

company shall be transferred to and vest in the Transferee

company without any further act or deed. Similarly, in terms of the

Scheme, all the liabilities and duties of the Transferor company

shall be transferred to the Transferee company without any further

act or deed. Upon the Scheme coming into effect the Transferor

company shall stand dissolved without winding up.

18. It is, however, clarified that this order will not be construed as an

order granting exemption from payment of stamp duty or taxes or

any other charges, if payable in accordance with any law; or

permission/compliance with any other requirement which may be

specifically required under any law.

19. Learned counsel for the Petitioner states that the Petitioner

companies would voluntarily deposit a sum of Rs 2,00,000/-in the

Common Pool Fund of the OL within three weeks from today. The

statement is taken on record.

20. The petition stands allowed in the above terms.

Order be given dasti.

R.V.EASWAR, J JULY 23, 2013 Bisht(M)