Mapsa Logistics Private Limited vs ...
2015 Latest Caselaw 7182 Del

                   IN THE HIGH COURT OF DELHI
                  COMPANY PETITION NO. 14/2015
                                    Reserved on 1st September, 2015
                        Date of pronouncement: 21st September, 2015
In the matter of
The Companies Act, 1956 & the Companies Act, 2013 (to the extent
applicable):

And

Petition under Sections 391 to 394 of the
Companies Act, 1956

Scheme of Amalgamation and Arrangement between:

Mapsa Logistics Private Limited
                                    Petitioner/Transferor Company No. 1

Mapsa Infra Private Limited
                                    Petitioner/Transferor Company No. 2

Empee Global Private Limited
                                    Petitioner/Transferor Company No. 3
      AND

Mapsa Tapes Private Limited
                                         Petitioner/Transferee Company

                               Through Mr. Vidur Bhatia and
                               Ms.Mandira Mitra, Advocates for the
                               petitioners
                               Ms.     Aparna     Mudiam, Assistant
                               Registrar of Companies for the
                               Regional Director
                               Ms. Ruchi Sindhwani, Advocate for the
                               Official Liquidator

SUDERSHAN KUMAR MISRA, J.

1. This joint petition has been filed under Sections 391 to 394 of the

Companies Act, 1956 by the petitioner companies seeking sanction of

the Scheme of Amalgamation and Arrangement between Mapsa

Logistics Private Limited (hereinafter referred to as the transferor

company no. 1); Mapsa Infra Private Limited (hereinafter referred to as

the transferor company no. 2); Empee Global Private Limited (hereinafter

referred to as the transferor company no. 3) and Mapsa Tapes 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 incorporated under the

Companies Act, 1956 on 26th August, 2008 with the Registrar of

Companies, NCT of Delhi & Haryana at New Delhi.

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

Companies Act, 1956 on 11th September, 2008 with the Registrar of

Companies, NCT of Delhi & Haryana at New Delhi.

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

the Companies Act, 1956 on 3rd July, 1995 with the Registrar of

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

style of M.P. Industries Private Limited. The company changed its name

to Empee Global Private Limited and obtained the fresh certificate of

incorporation on 1st September, 2007.

6. The transferee company was incorporated under the Companies

Act, 1956 on 21st July, 1988 with the Registrar of Companies, NCT of

Delhi & Haryana at New Delhi.

7. The present authorized share capital of the transferor company

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

Rs.10/- each. The issued, subscribed and paid-up share capital of the

company is Rs.9,90,00,000/- divided into 99,00,000 equity shares of

Rs.10/- each.

8. The present authorized share capital of the transferor company

no.2 is Rs.10,00,00,000/- divided into 1,00,00,000 equity shares of

Rs.10/- each. The issued, subscribed and paid-up share capital of the

company is Rs.9,21,00,000/- divided into 92,10,000 equity shares of

Rs.10/- each.

9. The present authorized share capital of the transferor company

no.3 is Rs.4,00,00,000/- divided into 40,00,000 equity shares of Rs.10/-

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

is Rs.2,87,20,000/- divided into 28,72,000 equity shares of Rs.10/- each.

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

Rs.5,00,00,000/- divided into 50,00,000 equity shares of Rs.10/- each.

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

Rs.3,52,40,000/- divided into 35,24,000 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 with the

joint application, being CA(M) 164/2014, earlier filed by the petitioners.

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

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

been filed.

12. A copy of the Scheme of Amalgamation and 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 claimed by the petitioners that the proposed Scheme will facilitate

greater integration and provide greater financial strength and flexibility for

the amalgamated entity, which would result in maximizing overall

shareholder value, and improve the competitive position of the combined

entity. It is further claimed that the Scheme will result in greater efficiency

in cash management of the amalgamated entity and unfettered access to

cash flow generated by the combined business, which can be deployed

more efficiently to fund organic and inorganic growth opportunities to

maximize shareholder value.

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:-

"20 equity share of Rs.10/- each of the transferee company, credited as fully paid up, for every 100 equity shares of Rs.10/- each held in the transferor company no. 1."

"19 equity share of Rs.10/- each of the transferee company, credited as fully paid up, for every 100 equity shares of Rs.10/- each held in the transferor company no. 2."

"41 equity share of Rs.10/- each of the transferee company, credited as fully paid up, for every 100 equity shares of Rs.10/- each held in the transferor company no. 3."

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

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

petitioner companies.

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

transferee company in their separate meetings held on 14th October,

2014 and 15th October, 2015 respectively have unanimously approved

the proposed Scheme of Amalgamation and Arrangement. 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 petitioner companies had earlier filed CA (M) No. 164/2014

seeking directions of this court to dispense with the requirement of

convening the meetings of their equity shareholders, secured and

unsecured creditors, which are statutorily required for sanction of the

Scheme of Amalgamation and Arrangement. Vide order dated 16th

December, 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, there being no secured creditors of the transferor

companies no. 1 to 3, to consider and, if thought fit, approve, with or

without modification, the proposed Scheme of Amalgamation and

Arrangement. Since the 'no objection' issued by the secured creditor of

the transferee company was not supported by any Board Resolution or

Power of Attorney in favour of the person who had signed the 'no

objection, learned counsel for the petitioners had undertaken to issue

advance notice to said secured creditor, viz. HDFC Bank, prior to filing of

the second motion calling for their objection, if any, to the Scheme of

Amalgamation and Arrangement. The petitioner companies were directed

to file proof of service of the said advance notice along with the second

motion petition.

17. The petitioner companies have thereafter filed the present petition

seeking sanction of the Scheme of Amalgamation and Arrangement. Vide

order dated 14th January, 2015, 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 'Business

Standard' (English) and (Hindi) Delhi editions. Affidavit of Service has

been filed by the petitioners showing compliance regarding service on the

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

regarding publication of citations in the aforesaid newspapers on 18th

March, 2015. Copies of the newspaper clippings containing the

publications have been filed along with the said affidavit. The petitioners

have also placed on record a copy of the notice served to HDFC Bank, in

terms of order dated 16th December, 2014, calling for their objections, if

any, to the Scheme of Amalgamation and Arrangement.

18. 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 13th April, 2015

wherein he has stated that he has not received any complaint against the

proposed Scheme of Amalgamation and Arrangement from any

person/party interested in the Scheme in any manner and that the affairs

of the transferor companies do not appear to have been conducted in a

manner prejudicial to the interest of their members, creditors or public

interest, as per second proviso of Section 394(1) of the Companies Act,

1956.

19. 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 6th May, 2015. Relying on Clause 4.4.1

of Part-IV of the Scheme, he has stated that, upon sanction of the

Scheme of Amalgamation and Arrangement, all the employees of the

transferor companies shall become the employees of the transferee

company without any break or interruption in their services. He has

further submitted that in Clause 2.3.1 (a) of Part-II of the Scheme, it has

been stated that the transferee company shall record the assets and

liabilities in the Undertakings transferred to and vested in it pursuant to

the Scheme, at the same value as that appearing in the books of the

transferor companies on the close of business in India on 31.03.2014 in

accordance with the pooling of interest method provided in Accounting

Standard-14 (Accounting for Amalgamation) issued by the Institute of

Chartered Accountants of India. He further submitted that in Clause 5.2.1

of Part-V of the Scheme, it has been stated that upon this scheme

becoming effective, the transferor companies no. 1 to 3 shall stand

dissolved without the process of winding up.

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

and Arrangement from any other party. The petitioner companies, in the

affidavits dated 7th May, 2015 of Mr. Mahesh Gupta, authorized

representative of the transferor companies and Mr. Pyare Lal Gupta,

authorized representative of the transferee company, have submitted that

neither the petitioner companies nor their counsel have received any

objection pursuant to the citations published in the newspapers on 18th

March, 2015.

21. Considering the approval accorded by the shareholders and

creditors of the petitioner companies to the proposed Scheme of

Amalgamation and Arrangement and the affidavits filed by the Regional

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

objection to the proposed Scheme of Amalgamation and Arrangement,

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

Scheme of Amalgamation and Arrangement. Consequently, sanction is

hereby granted to the Scheme of Amalgamation and Arrangement 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, 2014, the transferor

companies no. 1 to 3 shall stand dissolved without undergoing the

process of winding up.

22. Learned counsel for the Official Liquidator prays that costs may

also be imposed keeping in view the fact that the matter has involved

examination of extensive records and prioritized hearings. He submits

that at least costs of Rs.1,00,000/- should be paid by the petitioners.

Learned counsel for the petitioners states that the same is acceptable to

him. Looking to the circumstances, the petitioners shall deposit a sum of

Rs.1,00,000/- by way of costs in the Common Pool Fund of the Official

Liquidator, within three weeks.

23. The petition is allowed in the above terms.

Dasti.

SUDERSHAN KUMAR MISRA, J.

September 21, 2015