Delhi High Court
M/S. Integrated Waste Management ... vs ... on 28 January, 2015
Author: Sudershan Kumar Misra
IN THE HIGH COURT OF DELHI
COMPANY PETITION NO. 598/2014
Reserved on 9th January, 2015
Date of pronouncement: 28th January, 2015
In the matter of
The Companies Act, 1956 & the Companies Act, 2013 (to the extent
applicable):
And
Petition under Section 391 to 394 of the
Companies Act, 1956
Scheme of Arrangement between:
M/s. Integrated Waste Management and Urban Services Company
(Tamil Nadu) Limited
Non-Petitioner/Transferor Company
AND
M/s. IL&FS Environmental Infrastructure & Services Limited
Petitioner/Transferee Company
Through Ms. Neha Sharma and Mr. D.
Verma Advocates for the petitioner
Ms. Aparna Mudiam, Assistant
Registrar of Companies for Regional
Director
SUDERSHAN KUMAR MISRA, J.
1. This petition has been filed under Sections 391 to 394 of the
Companies Act, 1956 by the petitioner/transferee company seeking
sanction of the Scheme of Arrangement between M/s. Integrated Waste
Management and Urban Services Company (Tamil Nadu) Limited
(hereinafter referred to as the transferor company) and M/s. IL&FS
Environmental Infrastructure & Services Limited (hereinafter referred to
as the petitioner/transferee company).
2. The registered office of the petitioner/transferee company is
situated at New Delhi, within the jurisdiction of this court. However, the
registered office of the transferor company is situated at Chennai, Tamil
Nadu, outside the jurisdiction of this court. Learned counsel for the
petitioner submit that the Scheme of Arrangement in respect of the
transferor company has already been sanctioned by the Madras High
Court vide order dated 21st November, 2014 passed in CP No. 241/2014
filed by the transferor company and a copy of the same is placed on
record.
3. The petitioner/transferee company was originally incorporated
under the Companies Act, 1956 on 2nd August, 2007 with the Registrar of
Companies, NCT of Delhi & Haryana at New Delhi under the name and
style of IL&FS Waste Management and Urban Services Limited. The
company changed its name to IL&FS Environmental Infrastructure and
Services Limited and obtained a fresh certificate of incorporation on 13 th
December, 2010.
4. The authorized share capital of the petitioner/transferee company,
as on 20th March, 2014, was Rs.50,00,00,000/- divided into 5,00,00,000
equity shares of Rs.10/- each. The issued, subscribed and paid-up share
capital of the company was Rs.34,92,32,490/- divided into 3,49,23,249
equity shares of Rs.10/- each.
5. A copy of the Memorandum and Articles of Association of the
petitioner/transferee company has been filed on record. The audited
balance sheet, as on 31st March, 2014, of the petitioner/transferee
company, along with the report of the auditors, has also been filed.
6. A copy of the Scheme of Arrangement has been placed on record
and the salient features of the Scheme have been incorporated and
detailed in the petition and the accompanying affidavit. It is submitted by
the petitioner that the focus and activities of both the companies
compliment each other and the consolidation of their resources would
lead to a simplified corporate structure focused on capitalizing upon
investment opportunities and providing a concentrated management
focus for the development of business of the companies. It is claimed that
the proposed amalgamation would lead to greater integration and greater
financial strength and flexibility for the amalgamated entity, which would
result in maximizing overall shareholder's value and will improve the
competitive position of the combined entity.
7. So far as the share exchange ratio is concerned, the Scheme
provides that that transferor company is a wholly owned subsidiary of the
petitioner/transferee company and on amalgamation no separate
consideration shall be paid by the petitioner/transferee company to the
shareholders of the transferor company and no shares shall be issued by
the petitioner/transferee company to any person in consideration of or
consequent upon the amalgamation.
8. It has been submitted by the petitioner that no proceedings under
Sections 235 to 251 of the Companies Act, 1956 are pending against the
petitioner/transferee company.
9. The Board of Directors of the petitioner/transferee company in their
meeting held on 12th November, 2013 have unanimously approved the
proposed Scheme of Arrangement. A copy of the Resolution passed at
the meeting of the Board of Directors of the petitioner/transferee
company has been placed on record.
10. The petitioner/transferee company had earlier filed CA (M) No.
79/2014 seeking directions of this court to dispense with the requirement
of convening the meetings of its shareholders, secured and unsecured
creditors, which are statutorily required for sanction of the Scheme of
Arrangement. Vide order dated 8th August, 2014, the court allowed the
application and dispensed with the requirement of convening and holding
the meeting of the equity shareholders, secured and unsecured creditors
of the petitioner/transferee company to consider and, if thought fit,
approve, with or without modification, the proposed Scheme of
Arrangement.
11. The petitioner/transferee company has thereafter filed the present
petition seeking sanction of the Scheme of Arrangement. Vide order
dated 30th September, 2014, notice in the petition was directed to be
issued to the Regional Director, Northern Region. Citations were also
directed to be published in 'Statesman' (English) and 'Jansatta' (Hindi)
editions. Affidavit of service has been filed by the petitioner showing
compliance regarding service on the Regional Director, Northern Region,
and also regarding publication of citations in the aforesaid newspapers
on 30th October, 2014. Copies of the newspaper clippings containing the
publications have been filed along with the affidavit of service.
12. In response to the notices issued in the petition, Mr. A.K.
Chaturvedi, Regional Director, Northern Region, Ministry of Corporate
Affairs has filed his report dated 8th December, 2014. Relying on Clause
12.1 of Part-V of the Scheme, he has stated that, upon sanction of the
Scheme of Arrangement, all the employees of the transferor company
shall become the employees of the transferee company without any
break or interruption in their services. He has further submitted that in
Clause 9.7 of Part-IV of the Scheme, it has been stated that the
petitioner/transferee company shall abide by the provisions of Accounting
Standard-14 issued by the Institute of Chartered Accountants of India. He
further submitted that in terms of Clause 7 of Part-III of the Scheme, with
effect from the appointed date, the transferor company, without any
further act or deed, shall stand dissolved without the process of winding
up.
13. No objection has been received to the Scheme of Arrangement
from any other party.
14. Considering the approval accorded by the equity shareholders,
secured and unsecured creditors of the petitioner/transferee company, to
the proposed Scheme of Arrangement and the affidavit filed by the
Regional Director, Northern Region, not raising any objection to the
proposed Scheme of Arrangement; and also in view of the order dated
21st November, 2014 passed by the Madras High Court in CP 241/2014
granting sanction to the proposed Scheme of Arrangement in respect of
the transferor company, there appears to be no impediment to the grant
of sanction to the Scheme of Arrangement. Consequently, sanction is
hereby granted to the Scheme of Arrangement under Section 391 and
394 of the Companies Act, 1956. The petitioner company will comply with
the statutory requirements in accordance with law. Certified copy of this
order be filed with the Registrar of Companies within five weeks. It is also
clarified that this order will not be construed as an order granting
exemption from payment of stamp duty as payable in accordance with
law. The sanction will be effective from the appointed date of
arrangement, that is 1st October, 2013.
15. The petition is allowed in the above terms.
Dasti.
SUDERSHAN KUMAR MISRA, J.
January 28, 2015
