Himalyan Technologies Limited vs .........
2014 Latest Caselaw 4780 Del

$~26
*IN THE HIGH COURT OF DELHI AT NEW DELHI
+    CO.PET.219/2014
IN THE MATTER
HIMALYAN TECHNOLOGIES LIMITED    ...Petitioners
                   Through: Mr. A.K. Kuchhal and Mr.
                            Manish Jain, Advocates for
                            Petitioner Companies.
                                  Mr.    Atma    Sah,  Assistant
                                  Registrar of Companies for the
                                  Regional Director.
                                  Mr. Rajiv Behl, Advocate for the
                                  Official Liquidator.
      CORAM:
      HON'BLE MR. JUSTICE SANJEEV SACHDEVA
                 ORDER

% 24.09.2014

SANJEEV SACHDEVA, J (ORAL)

1. This second motion joint petition has been filed under sections 391 to 394 of the Companies Act, 1956 ("Act") seeking sanction of the Scheme of Amalgamation ("Scheme") of Himalyan Technologies Limited (hereinafter referred to as Transferor Company) with Srishty Medical Private Limited (hereinafter referred to as Transferee Company) (hereinafter all Companies collectively referred to as

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Petitioner Companies). A copy of the Scheme has been enclosed with the Petition.

2. The registered office of the Petitioner Companies is situated at New Delhi, within the jurisdiction of this Court.

3. Details with regard to the date of incorporation of the Petitioner Companies, their authorized, issued, subscribed and paid up capital have been given in the Petition.

4. Copies of the Memorandum and Articles of Association as well as the latest audited Accounts as at 31st March 2013 of the Petitioner Companies have also been enclosed with the Petition.

5. Copies of the Resolutions passed by the Board of Directors of the Petitioner Companies approving the Scheme of Amalgamation have also been placed on record.

6. It has been submitted that no proceedings under sections 235 to 251 of the Companies Act, 1956 is pending against the Petitioner Companies.

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7. The Petitioner Companies had earlier filed C.A (M) No. 108 seeking directions of this Court for dispensation/convening of meetings. Vide Order dated 6th December 2013 this Court allowed the application and dispensed with the requirement of convening meetings of Equity Shareholders, Secured and Un- secured Creditors of the Petitioner Companies.

8. The Petitioner Companies have thereafter filed the present Petition seeking sanction of the Scheme of Amalgamation. Vide Order dated 15th April 2014, notice in the Petition was directed to be issued to the Regional Director, Northern Region and the Official Liquidator. Citations were also directed to be published in the "Business Standard" (English) and "Jansatta" (Hindi). Affidavit of Service and Publication has been filed by the Petitioners showing compliance regarding service of the Petition on the Regional Director, Northern Region and the Official Liquidator, and also regarding publication of citations in the aforesaid newspaper. Copies of the newspaper cuttings, in original, containing the publications have been filed along with the Affidavit of Service.

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9. In response to the notice issued, the Official Liquidator sought information from the Petitioner Companies. Based on the information received, the Official Liquidator has filed his Report dated 12th July 2014, 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 Transferor Company do not appear to have been conducted in a manner prejudicial to the interest of its members, creditors or to public interest as per the 2 nd proviso of section 394(1) of the Act.

10. In response to the notice issued in the Petition, learned Regional Director, Northern Region, Ministry of Corporate Affairs, has filed his Affidavit/Report dated 11th July 2014. Relying on the Scheme of Amalgamation, 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. Further, the learned Regional Director submits that despite notice, the Income Tax Authorities

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have not raised any objection with regard to the Scheme.

11. The learned Regional Director in its Affidavit has raised a concern that the Appointed Date as per the Scheme has been fixed as 01.04.2012, whereas the Companies have prepared their Balance Sheet and Profit & Loss Account for the period 31.03.2013 and filed the same with Registrar of the Companies, the Appointed date be shifted to 01.04.2013 to avoid any revision of Balance Sheet and Profit & Loss Account and other returns including Income Tax Returns filed in the earlier period.

12. In response to the aforesaid observation, the Petitioner Companies, in their Reply Affidavit dated 4th August, 2014, have stated that fixation of Appointed Date is purely a business decision and is the prerogative of Shareholders of the Company and accordingly, the Board and Shareholders of the Company after due deliberation has fixed 01.04.2012 as Appointed Date. It is submitted that the requisite resolutions had been passed in the relevant financial year. Further, it has been stated that the Company had already planned for revision of Balance Sheet and Profit & Loss Account & ==================================================

other returns including Income Tax Return. It is submitted that there is no requirement for change of the appointed date.

13. In support of his contention, learned Counsel relies upon the judgments of this Court in GOLDEN STRAND PVT LTD. DATED 19.09.2014 IN C.P No. 577 OF 2014, VODAFONE SPACETEL LIMITED & ANR. DATED 03.07.2014 IN C.P. NO. 187 OF 2013 and of the BOMBAY HIGH COURT IN M/S JINDAL IRON & STEEL DATED 02.09.2004 IN C.P. NO.76 OF 2004 and of the GUJARAT HIGH COURT IN SHREE BALAJI CINEVISION DATED 23.09.2009 IN O.J. APPEAL NO.65 OF 2009.

14. Further, the learned Counsel for the Petitioner Companies submits that, no objection to the appointed date has been raised by any shareholder or creditor of the Petitioner Companies. In view of the above, there is no requirement to change the appointed date as sought for by the Regional Director. However it is clarified that, in case there is any necessity of filing of any revised returns with the Income Tax or any other Authority, the Petitioner Companies shall duly file the same and pay the requisite fees as per law. ==================================================

15. It is directed that the Income Tax Authorities are at liberty to assess the income of the Transferor and Transferee Companies for the Financial Year 01.04.2012 to 31.03.2013 irrespective of the sanction of the scheme and in case any tax liability arises, the Transferor Company shall be liable to pay the same.

16. Further, the learned Regional Director has raised his concern that the Registrar of Companies has stated that the Auditor in their report to the Balance Sheet as on 31.03.2013 has mentioned that the Company has not granted any loan to parties covered in the register maintained as per Section 301 of the Act whereas in para 4 of Notes to Accounts to the said Balance Sheet it has been mentioned that debts due by directors and Companies in which the directors are interested are shown in advances in the Balance Sheet are mentioned therein. Thus the non-compliance of the provisions of Section 295 of the Companies Act, 1956 cannot be ruled out.

17. In response to the aforesaid observation, the Petitioner Companies in their Reply Affidavit have stated that both the Transferor and Transferee Companies have not granted any loan to the related parties covered. The ==================================================

debit entries shown in advances are the amounts advance to the Directors for petty expenses and advance against salaries. Apart from this, the Company has not granted any advance or loan to the related parties, and both the items of Petty Cash and Advance salaries are outside the purview of Section 295 of the Companies Act, 1956.

18. Further, the learned Regional Director has raised another concern that, the Registrar of Companies has stated that the Auditor in Para 5 of annexure to their report for the Balance Sheet as on 31.03.2013 has mentioned inter-alia that the transactions made in pursuance of contract agreement that need to be entered to the register maintained as per Section 301 of the Act has been recorded in the register whereas the Company has not disclosed any related party transactions in its Balance Sheet as on 31.03.2013 in compliance of the provisions of Section 211(3C) read with Accounting Standard 18 of the Act, hence no comments can be offered, if any of provisions of Section 297 of the Companies Act, 1956.

19. In response to the aforesaid observation, the Petitioner Companies in their Reply Affidavit have stated that ==================================================

there was no related party transaction during the period in question and thus there is no reason to report the same in the Balance Sheet dated 31.03.2013. However, so far as the fact that the transactions made in pursuance of contract agreement that need to be entered in the register maintained as per Section 301 of the Act has been recorded in the register which relates to the entries with respect to Annual General Disclosures received from the Directors in terms of Section 301 of the Companies Act, 1956 and the same has duly been recorded in the respective registers maintained by the Company.

20. Further it is directed that the Registrar of Companies is also at liberty to independently examine the books of accounts irrespective of the sanction of the scheme and in case any violation or breach of any statutory provision is found, the directors of the transferor and the transferee shall be liable irrespective of the sanction of the scheme.

21. In view of the aforesaid clarifications and undertaking, the concerns of the Regional Director have been duly addressed.

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22. No objection has been received to the Scheme from any other party. Mr. A.K. Kuchhal, Counsel for Petitioner Companies, has filed an Affidavit dated 14th July, 2014 confirming that neither the Petitioner Companies nor he has received any objection pursuant to citations published in the newspapers.

23. In view of the approval accorded by the Shareholders and Creditors of the Petitioner Companies; representation/reports filed by the Regional Director, Northern Region and the Official Liquidator, attached with this Court to the proposed Scheme of Amalgamation, there appears to be no impediment to the grant of sanction to the Scheme of Amalgamation. Consequently, sanction is hereby granted to the Scheme of Amalgamation under sections 391 and 394 of the Companies Act, 1956. The Petitioner Companies will comply with the statutory requirements in accordance with law.

24. Certified copy of the order be filed with the Registrar of Companies within 30 days from the date of receipt of the same. In terms of the provisions of sections 391 and 394 of the Companies Act, 1956, and in terms of the Scheme, the whole or part of the undertaking, the ==================================================

property, rights and powers of the Transferor Companies 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 Companies be transferred to the Transferee Company without any further act or deed.

25. 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 department which may be specifically required under any law.

26. Learned Counsel for the Petitioner states that the Petitioner Companies (collectively) would voluntarily deposit a sum of Rs.50,000/- in the Common Pool fund of the Official Liquidator within three weeks from today. The statement is accepted.

27. The Petition is allowed in the above terms.

Order Dasti.

SANJEEV SACHDEVA, J SEPTEMBER 24, 2014/st ==================================================