Allowed

Siemens Vai Metals Technologies Pvt. Ltd. Vs

Bombay HC17 Aug 2012CSP/234/2012

Case brief

AI extract

What is this about?

The court allowed petitions under Sections 391 to 394 of the Companies Act, 1956, for a scheme of amalgamation of two transferor companies with a transferee company. The court held the scheme was fair, creditor interests would not be adversely affected due to improved net worth, and statutory compliances were fulfilled.

What did the court decide?

Petitions No. 233, 234, and 235 of 2012 made absolute. Petitioners directed to pay stamp duty and file order with Registrar of Companies within stipulated time.

Siemens Vai Metals Technologies Pvt. Ltd. Vs — Insolvency and Bankruptcy | Bombay HC (2012)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

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COMPANY SCHEME PETITION NO. 234 OF 2012

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CONNECTED WITH

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COMPANY SUMMONS FOR DIRECTION NO. 7 OF 2012

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SIEMENS VAI METALS TECHNOLOGIES PVT. LTD ……...Petitioner / Transferor

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Company No. 1

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AND

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COMPANY SCHEME PETITION NO. 233 OF 2012

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CONNECTED WITH

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COMPANY SUMMONS FOR DIRECTION NO. 6 OF 2012

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MORGAN CONSTRUCTION COMPANY INDIA PVT. LTD. ……...Petitioner /

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Transferor Company No. 2

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WITH

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COMPANY SCHEME PETITION NO. 235 OF 2012

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CONNECTED WITH

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COMPANY SUMMONS FOR DIRECTION NO. 8 OF 2012

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SIEMENS LIMITED ……...Petitioner / Transferee Company

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In the matter of:

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The Companies Act, 1956;

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AND

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In the matter of:

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Sections 391 to 394 of the Companies Act, 1956;

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In the matter of:

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The Scheme of Amalgamation of:

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(i) Siemens VAI Metals Technologies Pvt. Ltd (“ Transferor Company No. 1 ”); and

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(ii) Morgan Construction Company India Pvt. Ltd. (“ Transferor Company No. 2 ”); with (iii) Siemens Limited (“Transferee Company” )

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Mr. Sanjay Jain along with Mr. Molla Hasan, i/b. AZB & Partners, Advocates for the Petitioners in all Petitions.

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Dr. T. Pandian, Official Liquidator present in CSP No. 233 of 2012 and CSP No. 234 of 2012.

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Mr. C.J. Joy with Mr. D.A. Dubey, i/b. Dr. T.C. Kaushik for Regional Director in all Petitions.

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CORAM : S.J. Kathawalla J.

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DATE : 17^th August, 2012

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PC:

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Heard learned counsel for the parties.

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The sanction of the Court is sought under Sections 391 to 394 of the Companies Act, 1956 to a Scheme of Amalgamation of Siemens VAI Metals Technologies Pvt. Ltd., the “ Transferor Company No. 1 ” and Morgan Construction Company India Pvt. Ltd., the “ Transferor Company No. 2 ” (with Siemens Limited, the “ Transferee Company ”.

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Counsel appearing on behalf of the Petitioners has stated that the Petitioners have complied with all requirements as per directions of this Court and they have filed necessary affidavits of compliance in the Court. Moreover, Petitioner Companies undertake to comply with all statutory requirements, if any, as required under the Companies Act, 1956 and the rules made there under. The undertaking is accepted.

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The Counsel for the Petitioner/Transferee Company states that they have received certain objections from two of its Unsecured Creditors to the proposed Scheme, that their dues have not been paid.

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Counsel appearing on behalf of the Petitioners states that Servo Tech Electricals Pvt. Ltd., one of the unsecured creditors of the Transferee Company have objected to the Scheme on grounds of non-payment of an alleged sum of Rs. 32,83,246/- along with interest on account of certain goods supplied to the

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Transferee Company. The Transferee Company has filed an Affidavit dated July 26, 2012 stating that Servo Tech Electricals Pvt. Ltd. was contracted by the Transferee Company as the Electrical Contractor for 400 kV Extension Project under WRSS II Set A. However, Servo Tech Electricals Pvt. Ltd. failed to perform the assignment as per the contractual arrangement entered into with them and thereafter the Transferee Company had terminated its service. The assignment was later performed by other vendors. As per the books of accounts of the Transferee Company, the retention amount is Rs. 963,244/- as against the alleged amount of Rs. 3,532,705/- claimed by Servo Tech Electricals Pvt. Ltd. The Transferee Company has justified withholding of the retention amount for recovering the additional expenses incurred by the Transferee Company due to the non-performance of the assignment by Servo Tech Electricals Pvt. Ltd. Counsel appearing on behalf of the Petitioners further states that the Transferee Company is not transferring any of its assets to any other company. On the contrary, pursuant to the Scheme, the assets of the Transferor Companies are being transferred to and vested in the Transferee Company.

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Counsel appearing on behalf of the Petitioners states that Shapoorji Pallonji & Co. Ltd., another unsecured creditor of the Transferee Company has objected to the Scheme on grounds of non-payment of alleged dues payable to them by the Transferee Company. The Transferee Company has filed an Affidavit dated July 26, 2012 wherein it has stated Shapoorji Pallonji & Co. Ltd was contracted by the Transferee Company as the civil contractor at L&T A/c Delhi International Airport Ltd (DIAL) site for T3 terminal. However, Shapoorji Pallonji & Co. Ltd. has not completed the entire work at site as required under the contractual arrangements entered into with them. In lieu thereof, DIAL has withheld the money due to the Transferee Company because of non-

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completion of task by Shapoorji Pallonji & Co. Ltd. (as a sub contractor of the petitioner Company) and accordingly some of their money has proportionately not been released. The Transferee Company has paid about Rs. 55,600,000/to Shapoorji Pallonji & Co. Ltd. against a final agreed amount of Rs. 59,000,000/-. An amount of Rs. 3,400,000/- (approx.) is pending due to nonfulfillment of various contractual obligations/ conditions. Notwithstanding the above, the Transferee Company has released ad hoc payments and is willing to release the balance outstanding payment of Rs. 3,400,000/- (approx.) on completion of all the agreed contractual conditions.

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Counsel appearing on behalf of the Petitioners states that the aggregate assets of the Transferor Companies and the Transferee Company are in excess of, and are more than sufficient to meet all their respective liabilities and the Scheme will not adversely affect the rights and interest of any of the creditors of any company in any manner whatsoever. The Transferee Company has produced Net Worth Certificates of the Transferee Company prior to and post amalgamation at Exhibit “F” to the Affidavit dated 26^th July, 2012. As per the certificate the present Net Worth of the Transferee Company is Rs. 33,268,953,000/- and the Net Worth post amalgamation will be Rs. 33,998,076,000/- i.e., an increase of Rs. 729,123,000/-. Thus, it is correctly stated that pursuant to the amalgamation of the Transferor Companies with the Transferee Company, the debt repayment capacity of the Transferee Company will in fact improve since both the Transferor Companies have positive Net Worth. Therefore, the Scheme and the amalgamation contemplated thereby will not adversely affect the interests of any of the secured or unsecured creditors of the Transferee Company as well as that of the Transferor Companies including Servo Tech Electricals Pvt. Ltd. and Shapoorji Pallonji & Co. Ltd.

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The Counsel appearing for the Petitioner states that the Scheme does not affect the rights of any of the Creditors as there is no Compromise or Arrangement with any of the Creditors. It will be open to the objecting Unsecured Creditors to peruse legal remedy as may be advised for recovery of their dues and that the Transferee Company shall abide by the orders that may be passed.

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The Official Liquidator has filed his report in Company Scheme Petition No. 233 of 2012 and Company Scheme Petition No. 234 of 2012 stating therein that the affairs of the Transferor Companies have been conducted in a proper manner and that the Transferor Companies may be ordered to be dissolved.

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The Regional Director has filed an affidavit stating therein that the Scheme is not prejudicial to the interest of shareholders and public.

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From the material on record, the Scheme appears to be fair and reasonable and is not violative of any provisions of law and is not contrary to public policy.

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Since all the requisite statutory compliances have been fulfilled, the Company Scheme Petition No. 234 of 2012 filed by the Transferor Company No. 1 is made absolute in terms of the prayer made under clauses (a) to (r). The Company Scheme Petition No. 233 of 2012 filed by the Transferor Company No. 2 is made absolute in terms of the prayer made under clauses (a) to (r). The Company Scheme Petition No. 235 of 2012 filed by the Transferee Company is made absolute in terms of the prayer made under clauses (a) to (r).

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The Petitioners to lodge a copy of this Order and the Scheme duly authenticated by the Company Registrar, High Court (O. S.), Bombay, with the concerned Superintendent of Stamps, for the purpose of adjudication of stamp duty payable, if any, on the same within 60 days from the date of the order.

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The Petitioners are directed to file a copy of this Order along with a copy of the Scheme of Amalgamation with the concerned Registrar of Companies, electronically, along with E-Form 21 in addition to physical copy within 30 days from the date of issuance of the order by the Registry.

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The Petitioners in all the Petitions to pay costs of Rs.10,000/- each to the Regional Director, Western Region, Mumbai and the Petitioners in the Company Scheme Petitions No. 233 of 2012 and 234 of 2012 to pay costs of Rs.10,000/- to the Official Liquidator, High Court, Bombay. Costs to be paid within four weeks from today.

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Filing and issuance of the drawn up order is dispensed with.

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All authorities concerned to act on a copy of this order along with Scheme duly authenticated by the Company Registrar, High Court (O. S.), Bombay.

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(S.J. Kathawalla J.)

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Siemens Vai Metals Technologies Pvt. Ltd. Vs

Case brief

What is this about?

What did the court decide?

Siemens Vai Metals Technologies Pvt. Ltd. Vs

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Statutes considered

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