All India Film Corporation ... vs ...
2015 Latest Caselaw 3445 Del

                  IN THE HIGH COURT OF DELHI
              COMPANY APPLICATION (MAIN) NO. 49/2015

                                           Reserved on 9th April, 2015
                               Date of pronouncement: 29th April, 2015
In the matter of
The Companies Act, 1956 & the Companies Act, 2013 (to the extent
applicable):

And

Application under Sections 391 to 394 of the
Companies Act, 1956 read with Rules 6 and 9
of the Companies (Court) Rules, 1959

Scheme of Amalgamation of:

All India Film Corporation Private Limited
                                      Applicant/Transferor Company No. 1

The All India Investment Corporation Private Limited
                                    Applicant/Transferor Company No. 2

World Media International Limited
                                     Applicant/Transferor Company No. 3
       WITH

World Media Private Limited
                                          Applicant/Transferee Company

                               Through Mr. Mahesh Aggarwal with
                               Mr. Rajeev Kumar, Advocates for the
                               applicants

SUDERSHAN KUMAR MISRA, J.

1. This joint application has been filed under Sections 391 and 394 of

the Companies Act, 1956 read with Rules 6 & 9 of the Companies

(Court) Rules, 1959 by the applicant companies seeking directions of this

court to dispense with the requirement of convening the meetings of their

equity shareholders, secured and unsecured creditors to consider and

approve, with or without modification, the proposed Scheme of

Amalgamation of All India Film Corporation Private Limited (hereinafter

referred to as the transferor company no. 1); The All India Investment

Corporation Private Limited (hereinafter referred to as the transferor

company no. 2); and World Media International Limited (hereinafter

referred to as the transferor company no. 3) with World Media 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 originally incorporated under the

Companies Act, 1913 on 27th October, 1944 under the name and style of

All India Film Corporation Limited. The company changed its name to All

India Film Corporation Private Limited and obtained the fresh certificate

of incorporation from the Registrar of Companies, NCT of Delhi &

Haryana at New Delhi on 27th May, 1980.

4. The transferor company no. 2 was originally incorporated under the

Companies Act, 1913 on 29th September, 1952 under the name and style

of The All India Investment Corporation Limited. The company changed

its name to The All India Investment Corporation Private Limited and

obtained the fresh certificate of incorporation from the Registrar of

Companies, NCT of Delhi & Haryana at New Delhi on 23rd September,

1976.

5. The transferor company no. 3 was incorporated under the

Companies Act, 1956 on 25th November, 1991 with the Registrar of

Companies, NCT of Delhi & Haryana at New Delhi.

6. The transferee company was originally incorporated under the

Companies Act, 1913 on 17th October, 1949 under the name and style of

Kishori Lal Shyam Lal and Company Private Limited. The company

changed its name to L.M. Distributors Private Limited and obtained the

fresh certificate of incorporation from the Registrar of Companies, NCT of

Delhi & Haryana at New Delhi on 18th January, 1982. The company again

changed its name to L.M. Distributors Limited and obtained the fresh

certificate of incorporation on 30th September, 1988. Thereafter, the

company changed its name to World Media Limited and obtained the

fresh certificate of incorporation on 10th October, 1991. The company

finally changed its name to World Media Private Limited and obtained the

fresh certificate of incorporation on 19th September, 2002.

7. The present authorized share capital of the transferor company

no.1 is Rs.34,04,900/- divided into 34,04,900 equity shares of Rs.1/-

each. The present issued, subscribed and paid-up share capital of the

company is Rs.2,24,806/- divided into 2,24,806 equity shares of Rs.1/-

each.

8. The present authorized share capital of the transferor company

no.2 is Rs.15,00,000/- divided into 14,000 equity shares of Rs.100/- each

aggregating to Rs.14,00,000/- and 1000 preference shares of Rs.100/-

each aggregating to Rs.1,00,000/-. The present issued, subscribed and

paid-up share capital of the company is Rs.9,80,000/- divided into 9,800

equity shares of Rs.100/- each.

9. The present authorized share capital of the transferor company

no.3 is Rs.1,00,00,000/- divided into 9,50,000 equity shares of Rs.10/-

each aggregating to Rs.95,00,000/- and 50,000 non-cumulative

redeemable preference shares of Rs.10/- each aggregating to

Rs.5,00,000/-. The present issued, subscribed and paid-up share capital

of the company is Rs.5,00,690/- divided into 50,069 equity shares of

Rs.10/- each.

10. The present authorized share capital of the transferee company is

Rs.1,00,00,000/- divided into 10,00,000 equity shares of Rs.10/- each.

The issued, subscribed and paid-up share capital of the company is

Rs.1,01,000/- divided into 10,100 equity shares of Rs.10/- each.

11. Copies of the Memorandum and Articles of Association of the

transferor and transferee companies have been filed on record. The

audited balance sheets, as on 31st March, 2014, of the transferor and

transferee companies, along with the report of the auditors, have 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 application and the accompanying affidavit. It is claimed

that the amalgamation will result in reduction of overheads,

administrative, managerial and other expenditure, and bring about

operational rationalization, organizational efficiency and optimal

utilization of various resources. It is further claimed that consolidation of

entities will result in significant reduction in the multiplicity of legal and

regulatory compliances required at present to be carried out by the

companies and also avoid duplication of administrative functions and

eliminate multiple record-keeping.

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 887 fully paid up equity shares of Rs.1/- each held in the transferor company no. 1."

It is provided that the transferor company no. 2 is a wholly owned

subsidiary of the transferee company. Therefore, the investment in the

shares of the transferor company no. 2 shall get cancelled and there will

be no issue and allotment of shares of the transferee company, upon the

Scheme becoming effective. It is further provided that the entire issued,

subscribed and paid up capital of the transferor company no. 3 is held by

the transferee company and its subsidiaries. Accordingly, in compliance

with Section 19 of the Companies Act, 2013, there shall be no issue and

allotment of shares of the transferee company upon amalgamation of the

transferor company no. 3.

14. It has been submitted by the applicants that no proceedings under

Sections 235 to 251 of the Companies Act, 1956 are pending against the

applicant companies.

15. The Board of Directors of the transferor and transferee companies

in their separate meetings held on 6th February, 2015 have unanimously

approved the proposed Scheme of Amalgamation. Copies of the

Resolutions passed at the meetings of the Board of Directors of the

transferor and transferee companies have been placed on record.

16. The transferor company no. 1 has 32 equity shareholders. 06 out

of 32 equity shareholders, being 18.75% in number and 98.35% in value,

have given their consents/no objections in writing to the proposed

Scheme of Amalgamation. Their consents/no objections have been

placed on record. They have been examined and found in order. In view

thereof, the requirement of convening the meeting of the equity

shareholders of the transferor company no. 1 to consider and, if thought

fit, approve, with or without modification, the proposed Scheme of

Amalgamation is dispensed with. There is no secured or unsecured

creditor of the transferor company no. 1, as on 31.01.2015.

17. The transferor company no. 2 has 02 equity shareholders and 01

unsecured creditor. Both the equity shareholders and the only unsecured

creditor have given their consents/no objections in writing to the

proposed Scheme of Amalgamation. Their consents/no objections have

been placed on record. They have been examined and found in order. In

view thereof, the requirement of convening the meetings of the equity

shareholders and unsecured creditor of the transferor company no. 2 to

consider and, if thought fit, approve, with or without modification, the

proposed Scheme of Amalgamation is dispensed with. There is no

secured creditor of the transferor company no. 2, as on 31.01.2015.

18. The transferor company no. 3 has 03 equity shareholders and 02

unsecured creditors. All the equity shareholders have given their

consents/no objections in writing to the proposed Scheme of

Amalgamation. Their consents/no objections have been placed on

record. As per the certificate dated 18th February, 2015 issued by V. K.

Arora & Associates, Chartered Accountants, out of 02 unsecured

creditors, 01 unsecured creditor namely Menichetti Glues & Adhesives

having an unsecured debt of Rs.32,578/- has been paid in full on

18.02.2015. The consent of other unsecured creditor has been placed on

record. All the consents have been examined and found in order. In view

thereof, the requirement of convening the meetings of the equity

shareholders and unsecured creditor of the transferor company no. 3 to

consider and, if thought fit, approve, with or without modification, the

proposed Scheme of Amalgamation is dispensed with. There is no

secured creditor of the transferor company no. 3, as on 31.01.2015.

19. The transferee company has 05 equity shareholders and 02

unsecured creditors. All the equity shareholders and both the unsecured

creditors have given their consents/no objections in writing to the

proposed Scheme of Amalgamation. Their consents/no objections have

been placed on record. They have been examined and found in order. In

view thereof, the requirement of convening the meetings of the equity

shareholders and unsecured creditors of the transferee company to

consider and, if thought fit, approve, with or without modification, the

proposed Scheme of Amalgamation is dispensed with. There is no

secured creditor of the transferee company, as on 31.01.2015.

20. The application stands allowed in the aforesaid terms.

Dasti

SUDERSHAN KUMAR MISRA, J.

April 29, 2015