Delhi High Court
Northern India Media Private ... vs ... on 3 August, 2016
IN THE HIGH COURT OF DELHI
COMPANY APPLICATION (MAIN) NO. 85/2016
Reserved on 30th May, 2016
Date of pronouncement: 3rd August, 2016
In the matter of
The Companies Act, 1956 & the Companies Act, 2013 (to the extent
applicable):
And
Application under Section 391(1) of the
Companies Act, 1956
Scheme of Amalgamation of:
Northern India Media Private Limited
Applicant/Transferor Company
WITH
Amar Ujala Publications Limited
Applicant/Transferee Company
Through Mr. Rajeev K. Goel, Advocate
for the applicants
SUDERSHAN KUMAR MISRA, J.
1. This joint application has been filed under Section 391(1) of the
Companies Act, 1956 by the applicant companies seeking directions of
this court to dispense with the requirement of convening the meetings of
their equity shareholders, preference shareholders, secured and
unsecured creditors to consider and approve, with or without
modification, the proposed Scheme of Amalgamation of Northern India
Media Private Limited (hereinafter referred to as the transferor company)
with Amar Ujala Publications 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 originally incorporated under the
Companies Act, 1956 on 16th October, 2006 with the Registrar of
Companies, NCT of Delhi & Haryana at New Delhi under the name and
style of Northern India Media Limited. The company changed its name to
Northern India Media Private Limited and obtained the fresh certificate of
incorporation on 10th October, 2012.
4. The transferee company was originally incorporated under the
Companies Act, 1956 on 29th March, 2001 with the Registrar of
Companies, Uttar Pradesh at Kanpur. The company shifted its registered
office from the State of Uttar Pradesh to Delhi and obtained a certificate
in this regard from the Registrar of Companies, NCT of Delhi & Haryana
at New Delhi on 26th February, 2007.
5. The present authorized share capital of the transferor company is
Rs.1,37,18,00,000/- divided into 50,000 equity shares of Rs.10/- each
aggregating to Rs.5,00,000/- and 13,71,30,000 preference shares of
Rs.10/- each aggregating to Rs.1,37,13,00,000/-. The issued, subscribed
and paid-up share capital of the company is Rs.1,37,15,00,000/- divided
into 50,000 equity shares of Rs.10/- each aggregating to Rs.5,00,000/-
and 13,71,00,000 compulsorily redeemable non-cumulative preference
shares of Rs.10/- each aggregating to Rs.1,37,10,00,000/-.
6. The present authorized share capital of the transferee company is
Rs.55,00,00,000/- divided into 5,50,00,000 equity shares of Rs.10/- each.
The issued, subscribed and paid-up share capital of the company is
Rs.10,97,56,120/- divided into 1,09,75,612 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. The
audited balance sheets, as on 31st March, 2015, of the transferor and
transferee companies, along with the report of the auditors, have 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 application and the accompanying affidavits. It is
submitted by the applicants that the transferor company is a wholly
owned subsidiary of the transferee company and the proposed
amalgamation would result in business synergy, consolidation and
pooling of their resources. It is 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.
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 not be required to issue and allot any shares since the
transferor company is a wholly owned subsidiary of the transferee
company.
10. It has been submitted by the applicants that no proceedings under
Sections 235 to 251 of the Companies Act, 1956 or under the
corresponding sections of the Companies Act, 2013 are pending against
the applicant companies.
11. The Board of Directors of the transferor and transferee companies
in their separate meetings held on 17th May, 2016 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.
12. The transferor company has 07 equity shareholders, 01 preference
shareholder and 10 unsecured creditors. All the equity shareholders, the
sole preference shareholder and all 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,
preference shareholders and unsecured creditors of the transferor
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 transferor company, as on 21st May,
2016.
13. The transferee company has 07 equity shareholders. 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. They have been examined and found in order. In
view thereof, the requirement of convening the meeting of the equity
shareholders of the transferee company to consider and, if thought fit,
approve, with or without modification, the proposed Scheme of
Amalgamation is dispensed with.
14. So far as the secured and unsecured creditors of the transferee
company are concerned, the transferee company has not provided the
list of its secured and unsecured creditors. However, it was pleaded by
learned counsel for the applicants that since the transferor company is a
wholly owned subsidiary of the transferee company; the applicant
companies are not proposing any arrangement with their shareholders
and creditors; and no new shares will be issued on amalgamation,
therefore, the rights of the secured and unsecured creditors of the
transferee company will not be affected. Hence, their consents/NOC are
not required to be obtained for the proposed amalgamation. It is further
submitted by learned counsel for the applicants that, post amalgamation,
the transferee company will continue to pay its creditors and other
liabilities in the normal course of its business. In support of his
submission, learned counsel placed reliance on the judgment of this
Court passed in Masterji Metalloys Private Limited, (CA(M) 9/2016)
and Stratford Academy Limited, (CA(M) 56/2016), wherein under
similar circumstances and relying on the judgment of this Court passed in
CA(M) 117/2009, the requirement of convening the meetings of the
shareholders and creditors of the transferee company was dispensed
with.
15. I have carefully considered the proposed Scheme and the case
law cited at the Bar. In view of the submissions made at the bar, the
settled law on the subject and considering the Scheme of Amalgamation,
I do not think convening and holding the meetings of the secured and
unsecured creditors of the transferee company would serve any purpose,
and, accordingly, the necessity of holding the meetings of the secured
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.
16. The application stands allowed in the aforesaid terms.
Dasti
SUDERSHAN KUMAR MISRA, J.
August 03, 2016
