Kailash Medical And Research ... vs ...
2016 Latest Caselaw 5605 Del

                  IN THE HIGH COURT OF DELHI
             COMPANY APPLICATION (MAIN) NO. 112/2016

                                           Reserved on 26th July, 2016
                             Date of pronouncement: 29th August, 2016
In the matter of
The Companies Act, 1956 & the Companies Act, 2013 (to the extent
applicable):

And

Application under Sections 391 and 394 of the
Companies Act, 1956

Scheme of Amalgamation of:

Kailash Medical and Research Centre Private Limited
                                        Applicant/Transferor Company
      WITH

Kailash Healthcare Limited
                                     Non-Applicant/Transferee Company

                               Through Mr. Saurabh Kalia with
                               Mr.Palash Agarwal and Mr. Dheeraj
                               Kumar, Advocates for the applicant

SUDERSHAN KUMAR MISRA, J.

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

Companies Act, 1956 by the applicant/transferor company seeking

directions of this court to dispense with the requirement of convening the

meetings of its equity shareholders, secured and unsecured creditors to

consider and approve, with or without modification, the proposed

Scheme of Amalgamation of Kailash Medical and Research Centre

Private Limited (hereinafter referred to as the applicant/transferor

company) with Kailash Healthcare Limited (hereinafter referred to as the

transferee company) and to dispense with the requirement of the

transferee company to approach this Court for seeking sanction of

Scheme of Amalgamation.

2. The registered offices of the applicant/transferor company and the

transferee company are situated at New Delhi, within the jurisdiction of

this Court.

3. The applicant/transferor company was incorporated under the

Companies Act, 1956 on 1st October, 1990 with the Registrar of

Companies, NCT of Delhi & Haryana at New Delhi.

4. The present authorized share capital of the applicant/transferor

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

Rs.100/- each. The issued, subscribed and paid-up share capital of the

company is Rs.9,77,79,600/- divided into 9,77,796 equity shares of

Rs.100/- each.

5. 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, along with the report of

the auditors, of the transferor and transferee companies have also been

filed.

6. 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

by the applicant that the proposed amalgamation is expected to improve

financial position through restructuring. It is further claimed that the

proposed amalgamation would result in simplified corporate structure and

therefore lead to a more efficient utilization of capital and create a

consolidated base for future growth of the transferee company.

7. So far as the share exchange ratio is concerned, the Scheme

provides that the transferor company is a wholly owned subsidiary of the

transferee company, therefore, the transferee company shall not be

required to issue any shares or pay any consideration to the

shareholders of the transferor company. Accordingly, no consideration

shall be payable by the transferee company under the Scheme.

8. 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/transferor company and the transferee company.

9. The Board of Directors of the applicant/transferor company and the

transferee company in their separate meetings held on 18th March, 2016

and 16th February, 2016 respectively 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.

10. The applicant/transferor company has 02 equity shareholders.

Both 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 applicant/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 or unsecured creditor of the applicant/transferor company, as on

31st May, 2016.

11. The applicant also seeks dispensation of requirement of the

transferee company to approach this Court for sanction of Scheme of

Amalgamation under Sections 391-394 of the Companies Act, 1956 on

the ground that the Scheme does not entail or involve any arrangement

between the transferee company and its shareholders. Further, since the

transferor company is a wholly owned subsidiary of the transferee

company, no new shares will be issued by the transferee company in lieu

of the shares of the transferor company; and there will be no change in

the control and management of the transferee company, therefore, the

rights of the shareholders of the transferee company will not be affected

in any manner whatsoever by the Scheme. It is further submitted that the

present Scheme does not envisage any compromise or arrangement by

the transferee company with their creditors and that the assets of both

the companies are more than sufficient to meet its liabilities, therefore,

the rights of the creditors of the transferee company will not be adversely

affected.

12. In support of his submissions, learned counsel placed reliance on

the judgment of this Court in CA(M) 29/2015 titled as Satyam Cineplexes

Limited with Inox Leisure Limited wherein this court under similar

circumstances, and relying on the judgments of several High Courts

including this Court in many cases such as eMeter India Pvt. Ltd.;

(CA(M) 179/2012) Auto Tools India Pvt. Ltd. [CA(M) 41/2010], Sharat

Hardware Industries Pvt. Ltd. (1978), 48 Com.Cas 23 (Delhi),

Mahaamba Investments Ltd. V. IDI Limited (2001) 105 Com Cas. 16

(Bom.), Andhra Bank Housing Finance Ltd. (2004) 118 Com.Cas.

295(AP) and Prosell Field Marketing Pvt. Ltd. [CA(M) 63/2012], had

dispensed with the requirement of the transferee company to approach

the High Court of Gujarat under Section 391(2) of the Companies Act,

1956 for sanction of the Scheme of Amalgamation.

13. I have considered the aforesaid case law cited at the Bar, wherein

the transferee company, being the holding company, has been granted

exemption from taking out separate proceedings under Section 391(2) of

the Companies Act, 1956. In view of the settled legal position and

considering the Scheme of Amalgamation, the requirement of the

transferee company having to approach this Court under Section 391(2)

of the Companies Act, 1956 for sanction of the Scheme of Amalgamation

is dispensed with.

14. The application stands allowed in the aforesaid terms.

Dasti

SUDERSHAN KUMAR MISRA, J.

August 29, 2016