Ala Financial Advisors Private ... vs Mair Securities Private Limited
2017 Latest Caselaw 408 Del

         IN THE HIGH COURT OF DELHI AT NEW DELHI

                                            Order Reserved On: 16.11.2016
                                            Order Delivered On: 24.01.2017


CO. APPL. (M) 130/2016

IN THE MATTER OF:-

ALA FINANCIAL ADVISORS PRIVATE LIMITED
                            ....Applicant/Transferor Company
                 AND

MAIR SECURITIES PRIVATE LIMITED
                             ....Applicant/ Transferee Company

                          Through:    Mr. Manoj Kumar Garg, Advocate for
                                      the Applicants.
CORAM:
HON'BLE MR JUSTICE SIDDHARTH MRIDUL


SIDDHARTH MRIDUL, J.

1. The present application has been filed jointly, under Sections 391 &

394 of the Companies Act, 1956, (hereinafter referred to as 'the Act') read

with Rule 9 of the Companies (Court) Rules, 1959 by ALA Financial

Advisors Private limited (hereinafter referred to as 'Transferor Company')

and Mair Securities Private Limited (hereinafter referred to as 'Transferee

Company'), seeking directions of this Court to dispense with the

requirement of convening the meetings of the equity shareholders, secured

creditors and unsecured creditors of the Transferor Company and Transferee

Company, to consider and if thought fit, approve, with or without

modification, the proposed scheme of amalgamation and arrangement of the

Transferor Company with the Transferee Company (hereinafter referred to

as 'the Scheme').

2. The Transferor Company and Transferee Company are hereinafter

collectively, referred to as 'Applicant Companies'.

3. The registered offices of the Applicant Companies are situated within

the National Capital Territory of Delhi, within the jurisdiction of this Court.

4. The Transferor Company was incorporated under the Act vide

certificate of incorporation dated 19.01.2006 issued by the Assistant

Registrar of Companies, NCT of Delhi & Haryana at New Delhi.

5. The Transferee Company was incorporated under the Act vide

certificate of incorporation dated 06.09.2007 issued by the Assistant

Registrar of Companies, NCT of Delhi & Haryana at New Delhi.

6. The Authorized Share Capital of the Transferor Company, as on

31.03.2015, is Rs.10,00,000/-, divided into 1,00,000 Equity Shares of

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

Transferor Company, as on 31.03.2015, is Rs.10,00,000/-, divided into

1,00,000 Equity Shares of Rs.10/- each.

7. The Authorized Share Capital of the Transferee Company as on

31.03.2015 is Rs.30,00,000/-, divided into 3,00,000 Equity Shares of Rs.10/-

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

Company as on 31.03.2015 is Rs.26,84,000/-, divided into 2,68,400 Equity

Shares of Rs.10/- each.

8. Copies of Memorandum of Association and Articles of Association of

the Applicant Companies have been filed and the same are on record. The

Audited Balance Sheets, as on 31.03.2015, of the Applicant Companies

along with the Auditors' Reports thereof have also been filed and the same

are on record.

9. It has been stated on behalf of the Applicant Companies that there are

no proceedings under Sections 235 to 251 of the Act (or under

corresponding Sections of the Companies Act, 2013) pending against any of

the Applicant Companies as on the date of filing of the present application.

10. A copy of the proposed Scheme has been filed on record and the

salient features of the Scheme have been incorporated and set out in detail in

the application and in the affidavit in support of the summons for directions

under section 391(1) of the Act. It has been stated in the present application

that the proposed Scheme, inter alia, provides for the Amalgamation of the

Transferor Company with the Transferee Company and the transfer of the

entire business of the Transferor Company to the Transferee Company, as a

going concern. It has been stated that the proposed amalgamation would

inter alia, aid the Applicant Companies in the following manner:-

a) Amalgamating Transferor Company and the Transferee Company will

give the consolidated company better finances, facilitate adequate

resource mobilization to sustain growth;

b) Strengthening and consolidating the position of the Transferee

Company and enabling it post-merger to participate more vigorously

and profitably in an increasingly competitive and liberalized market;

c) Enabling better leverage of facilities, infrastructure and human

resources and for better administration;

d) Enabling the amalgamated entity to raise funds from the financial

institutions on better terms. The synergy of the amalgamation will

improve operational efficiency, integrated management functioning

and will enhance the share value for the benefit of shareholders of the

existing entities;

e) The merger of Transferor Company into Transferee Company will

result in reduction of overheads, administrative, managerial and other

expenditure, and bring about operational rationalization,

organizational efficiency, and optimal utilization of various resources.

11. So far as 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:

"Two (2) Equity Shares of Rs.10/- each of Mair Securities Private Limited/Transferee Company shall be allotted for every one (1) Equity Share of Rs.10/- each of ALA Financial Advisors Private Limited/Transferor Company and fraction to be paid in cash."

12. The proposed Scheme has been approved by the respective Board of

Directors of the Applicant Companies, in their separate meetings held on

31.03.2016. Copies of the Resolutions passed at the meetings of the Board of

Directors of the Applicant Companies have been placed on record.

13. The Transferor Company has 05 (Five) Equity Shareholders and all the

Equity Shareholders have given their written consents/NOCs to the

implementation of the proposed Scheme. The said written consents/NOCs

have been placed on record. The same have been examined and found in

order.

14. In view of the foregoing, the requirement of convening the meeting of

the equity shareholders of the Transferor Company to consider and, if thought

fit, approve, with or without modification, the proposed scheme is dispensed

with.

15. The Transferor Company does not have any secured creditors and

therefore, the question of convening their meeting, does not arise.

16. The Transferor Company has 03 (three) unsecured creditors and all of

them have given their written consents/NOCs to the implementation of the

proposed Scheme. The said written consents/NOCs have been placed on

record. The same have been examined and found in order.

17. In view of the foregoing, the requirement of convening the meeting of

the unsecured creditors of the Transferor Company to consider and, if thought

fit, approve, with or without modification, the proposed scheme is dispensed

with.

18. The Transferee Company has 02 (Two) Equity Shareholders and both

Shareholders have given their written consents/NOCs to the implementation

of the proposed Scheme. The said written consents/NOCs have been placed

on record. The same have been examined and found in order.

19. In view of the foregoing, 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 is dispensed

with.

20. The Transferee Company does not have secured creditors and therefore,

the question of convening their meeting, does not arise.

21. The Transferee Company has 07 (seven) unsecured creditors and 6 out

of 7 unsecured creditors of the Transferee Company have given their written

consents/NOCs to the implementation of the Proposed Scheme. The said

written consents/NOCs have been placed on record. The same have been

examined and found in order. 'Other expenses payable' have been recorded as

the seventh unsecured creditor.

22. In view of the foregoing, the requirement of convening the meeting of

the unsecured creditors of the Transferee Company to consider and, if thought

fit, approve, with or without modification, the proposed scheme is dispensed

with.

23. The application stands allowed in the aforesaid terms and is disposed

of accordingly.

SIDDHARTH MRIDUL, J JANUARY 24, 2017 sb/mk