M/S. Pulse Realty Private Limited vs ...
2015 Latest Caselaw 2247 Del

                    IN THE HIGH COURT OF DELHI
                  COMPANY PETITION NO. 717/2014

                                      Reserved on 23rd February, 2015
                             Date of pronouncement: 17th March, 2015
In the matter of
The Companies Act, 1956 & the Companies Act, 2013 (to the extent
applicable):

And

Petition under Section 391(2) & 394 of the
Companies Act, 1956

Scheme of Amalgamation of:

M/s. Pulse Realty Private Limited
                                         Petitioner/Transferor Company
      WITH

M/s. Luke Securities Private Limited
                                        Petitioner/Transferee Company

                               Through      Mr.    Mukesh    Sukhija,
                               Advocate for the petitioners
                               Ms.     Aparna     Mudiam,   Assistant
                               Registrar of Companies for the
                               Regional Director
                               Mr. Rajiv Bahl, Advocate for the
                               Official Liquidator

SUDERSHAN KUMAR MISRA, J.

1. This joint petition has been filed under Sections 391(2) & 394 of

the Companies Act, 1956 by the petitioner companies seeking sanction

of the Scheme of Amalgamation of M/s. Pulse Realty Private Limited

(hereinafter referred to as the transferor company) with M/s. Luke

Securities 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 was incorporated under the Companies

Act, 1956 on 19th October, 2004 with the Registrar of Companies, NCT of

Delhi & Haryana at New Delhi.

4. The transferee company was originally incorporated under the

Companies Act, 1956 on 7th March, 1994 with the Registrar of

Companies, NCT of Delhi & Haryana at New Delhi under the name and

style of Rajesh & Ashok Securities Private Limited. The company

changed its name to Luke Securities Private Limited and obtained the

fresh certificate of incorporation on 11th February, 2010.

5. The present authorized share capital of the transferor 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.67,58,000/- divided into 6,75,800 equity shares of Rs.10/- each.

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

Rs.1,50,00,000/- divided into 15,00,000 equity shares of Rs.10/- each.

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

Rs.1,11,00,000/- divided into 11,10,000 equity shares of Rs.10/- each.

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

transferor and transferee companies have been filed on record with the

joint application, being CA(M) 154/2014, earlier filed by the petitioners.

The audited balance sheets, as on 31st March, 2013, of the transferor

and transferee companies, along with the report of the auditors, had also

been filed.

8. 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 petition and the accompanying affidavit. It is submitted by

the petitioners that both the companies are closely held private limited

companies and that the transferee company is presently engaged in

consultancy services. It is claimed that the proposed amalgamation

would result in business synergy and consolidation of these companies

into one large company with a stronger asset base. It is further claimed

that the proposed amalgamation will result in usual economies of a

centralized and a large company including elimination of duplicate work,

reduction in overheads, better and more productive utilization of human

and other resources and enhancement of overall business efficiency. It

will enable these companies to combine their managerial and operating

strength, to build a wider capital and financial base and to promote and

secure overall growth of their businesses.

9. 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 company in the following ratio:

"3.20 equity shares of Rs.10/- each of the transferee company for every 01 equity share of Rs.10/- each held by the shareholders in the transferor company".

10. It has been submitted by the petitioners that no proceedings under

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

transferor and transferee companies.

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

in their separate meetings held on 11th August, 2014 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 had been placed in CA(M)

154/2014.

12. The petitioner companies had earlier filed CA (M) No. 154/2014

seeking directions of this court to dispense with the requirement of

convening the meetings of their shareholders, secured and unsecured

creditors, which are statutorily required for sanction of the Scheme of

Amalgamation. Vide order dated 7th November, 2014, this court allowed

the application and dispensed with the requirement of convening and

holding the meetings of the equity shareholders, secured and unsecured

creditors of the transferor and transferee companies to consider and, if

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

of Amalgamation.

13. The petitioner companies have thereafter filed the present petition

seeking sanction of the Scheme of Amalgamation. Vide order dated 21st

November, 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 'Indian Express' (English) and

'Dainik Bhaskar' (Hindi) editions. Affidavit of service has been filed by the

petitioners showing compliance regarding service on the Regional

Director, Northern Region and the Official Liquidator, and also regarding

publication of citations in the aforesaid newspapers on 11th December,

2014. Copies of the newspaper clippings containing the publications have

been filed along with the affidavit of service.

14. Pursuant to the notices issued, the Official Liquidator sought

information from the petitioner companies. Based on the information

received, the Official Liquidator has filed a report dated 19th February,

2015 wherein he has stated that he has not received any complaint

against the proposed Scheme of Amalgamation 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 public interest, as

per second proviso of Section 394(1) of the Companies Act, 1956.

15. 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 20th February, 2015. Relying on Clause

8 of Section D of the Scheme, he has stated that, upon sanction of the

Scheme of Amalgamation, 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 15(a) of Section G of the Scheme, it has been stated that

amalgamation shall be an 'amalgamation in the nature of merger' as

defined in Accounting Standard-14 issued by the Institute of Chartered

Accountants of India and shall be accounted for under the 'pooling of

interest' method in accordance with the said AS-14. He further submitted

that in Clause 10 of Section E of the Scheme, it has been stated that

upon this scheme becoming effective, the transferor company shall stand

dissolved without the process of winding up.

16. No objection has been received to the Scheme of Amalgamation

from any other party. The petitioner companies, in the affidavit dated 19th

February, 2015 of Sh. Manoj Kumar, Director of the petitioner companies,

have submitted that neither the petitioner companies nor their counsel

have received any objection pursuant to the citations published in the

newspapers on 11th December, 2014.

17. Considering the approval accorded by the equity shareholders,

secured and unsecured creditors of the petitioner companies to the

proposed Scheme of Amalgamation and the affidavits filed by the

Regional Director, Northern Region, and the Official Liquidator not raising

any objection 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. Certified copy of this order be filed

with the Registrar of Companies within 30 days. 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. Upon the

sanction becoming effective from the appointed date of Amalgamation,

i.e. 1st April, 2013, the transferor company shall stand dissolved without

undergoing the process of winding up.

18. The petition is allowed in the above terms.

Dasti.

SUDERSHAN KUMAR MISRA, J.

March 17, 2015