Allowed

M/S.Vijay Silk House(Bangalore) Ltd. v. ---

Bombay HC24 Jan 2014CSP/500/2013

Case brief

AI extract

What is this about?

This court sanctioned a Scheme of Amalgamation between Vijay Silk House (Bangalore) Limited and Vinayak Nirman Private Limited under Sections 391 and 394 of the Companies Act, 1956. The court found the scheme fair, reasonable, and not opposed by any party. It upheld the extension of the scheme's effective date and directed compliance with stamp duty and filing requirements.

What did the court decide?

Company Scheme Petition No. 500 of 2013 was made absolute. Orders dismissed; costs awarded.

M/S.Vijay Silk House(Bangalore) Ltd. Vs --- — Company and Corporate | Bombay HC (2014)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY

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ORDINARY ORIGINAL CIVIL JURISDICTION

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COMPANY SCHEME PETITION NO. 500 OF 2013

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COMPANY SUMMONS FOR DIRECTION NO. 277 OF 2013

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In the matter of Sections 391 and 394 of the Companies Act, 1956

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And

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In the matter of Vijay Silk House (Bangalore) Limited, a Company incorporated under the Companies Act, 1956 and having its registered office at 4/27, Kamal Mansion, 1^st Floor, Arthur Bunder Road, Colaba, Mumbai – 400 005.

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And

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In the matter of the Scheme of Amalgamation of Vijay Silk House (Bangalore) Limited, Transferor Company with Vinayak Nirman Private Limited, Transferee Company

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M/s. Vijay Silk House (Bangalore) Limited … Petitioner Company

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CALLED FOR HEARING

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Mr. Farhan Dubhash Advocate i/b M/s. Federal & Rashmikant, Advocates for the Petitioner

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Mrs. R.N. Sutar, Asst. Official Liquidator, present

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Mr. C.J. Joy, i/b. Mr. H.P. Chaturvedi, for Regional Director.

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Coram: G.S. Patel, J.

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Date: 24^th January, 2014

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P.C.:

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Heard learned counsel for the parties. No objector has come before the court to oppose the Scheme and nor any party has controverted any averments made in the Petition.

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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 M/s. Vijay Silk House (Bangalore) Ltd., the Transferor Company, with Vinayak Nirman Private Limited, the Transferee Company.

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The Learned Advocate for the Petitioner Company states that the Petitioner is engaged in the business of export of Textiles, Fabrics and related activities pursuant to its objects as mentioned in its Memorandum of Association. The Petitioner as well as the Transferee Company are part of the same group of companies and the majority/substantial shareholding interest are common to both companies. The Petitioner after due consideration thought it advantageous to combine its activities with that of the Transferee Company. The funds available with the Petitioner and the Transferee Company can be utilized to fund the future plans of the amalgamated company and its business activities. Such business plans could also take advantage of the existing infrastructure of the Petitioner. The amalgamation of the Petitioner with the Transferee Company will make possible the fullest use of the existing infrastructure of both companies and achieve a stronger resource base leading to a position of strength vis-à-vis competition. The amalgamation will also result in more profitable utilization of the combined

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resources of both companies and be conducive to avoidance of duplication of expenses. It would also provide all employees of the Petitioner continued employment with the Transferee Company consequent on the merger of the Petitioner with the Transferee Company.

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The Learned Counsel for the Petitioner states that the Board of Directors of the Petitioner Company and the Transferee Company has approved the Scheme of Amalgamation and passed Board Resolutions accordingly.

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The Learned Counsel for the Petitioner states that Clause 19 (a) of the Scheme gives power to the respective Board of Directors of the Transferor and the Transferee Company to modify any part of the Scheme. However, it was clarified that the power vested under Clause 19 (a) of the Scheme will be subject to the approval of the High Court in consonance with Section 392 of the Companies Act, 1956 as per Order dated 22^nd March, 2013, passed in Company Summons for Direction No. 277 of 2013.

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The Learned Advocate for the Petitioner further states that Petitioner Company has complied with all the directions passed in Company Summons for Direction and that the Company Scheme Petition has been filed in consonance with the orders passed in Company Summons for Directions.

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The Learned Counsel appearing on behalf of the Petitioner has stated that the Petitioner has complied with all requirements as per directions of this

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Court and it has filed all necessary Affidavits of compliance in the Court. Moreover, the Petitioner undertakes to comply with all statutory requirements, if any, as required under the Companies Act, 1956 and the rules made thereunder. The said undertaking is accepted.

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The Regional Director has filed an affidavit on 19^th December, 2013 stating therein that save and except what is stated in paragraph 6 of the Affidavit, it appears that the Scheme is not prejudicial to the interest of shareholders and public. In paragraph 6 of the said Affidavit it is stated:

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“6. That the Deponent further submits that, the Registered Office of the Transferee Company is situated in the State of Uttar Pradesh. Hence the Transferee Company has to file similar petition before the Hon’ble High Court of Uttar Pradesh for approving the said Scheme.”

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As far as the observation made by the Regional Director in paragraph 6 of the Affidavit of the Regional Director is concerned, the Learned Advocate of the Petitioner Company submits that the Transferee Company, Vinayak Nirman Pvt. Ltd. has filed a Petition being Company Petition No. 9 of 2013 for sanction of the Scheme before the Hon’ble Allahabad High Court and vide Order dated 14^th May, 2013, the Hon’ble Allahabad High Court was pleased to sanction the Scheme of Amalgamation. The Learned Advocate for the Petitioner Company states that a copy of the said Order is annexed as Exhibit “C” to the Further Affidavit of the Petitioner dated 17^th January, 2014.

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The Learned Advocate for the Petitioner Company states that as per Clause 21 of the Scheme the date of giving effect to the Scheme was 30^th September, 2013. In view of the same, the date of giving effect to the Scheme was required to be extended, otherwise the Scheme would be null and void. The Learned Advocate for the Petitioner Company states that the Petitioner Transferor Company as well as the Transferee Company have passed Board Resolutions dated 11^th January, 2014 and 10^th January, 2014 respectively and the date of giving effect to the Scheme has been extended till 30^th September, 2014. The same are annexed as Exhibit A & B to the Further Affidavit of the Petitioner dated 17^th January, 2014, which is already filed. The said Affidavit has also been served upon the Regional Director and the Official Liquidator.

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The Learned Counsel for the Regional Director on instructions of Mr. M. Chandnamuthu, Joint Director in the office of the Regional Director, Ministry of Corporate Affairs, Western Region, Mumbai states that they are satisfied with the submission given in paragraph 9 hereinabove by the Advocate for the Petitioner Company and agree with the extension of the date of giving effect to the Scheme as per the Board Resolutions mentioned in paragraph 10 hereinabove.

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The Official Liquidator has filed his report on 16^th September, 2013 stating therein that the affairs of the Transferor Company have been conducted in a proper manner and that the Transferor Company may be ordered to be dissolved.

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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. None of the parties concerned have come forward to oppose the Scheme.

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Since all the requisite statutory compliances have been fulfilled, the Company Scheme Petition No. 500 of 2013 is made absolute in terms of prayer Clauses (a) to (e).

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The Petitioner 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 order.

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Petitioner Companies are directed to file a copy of this order along with a copy the Scheme with the concerned Registrar of companies, electronically, along with E-form 21 in addition to the physical copy, as per the provisions of the Companies Act, 1956.

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The Petitioner Company to pay costs of Rs. 10,000/- to the Regional Director and to the Official Liquidator each. Costs to be paid within four weeks from date as order.

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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.),

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Bombay.

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(G.S. PATEL, J)

M/S.Vijay Silk House(Bangalore) Ltd. v. ---

Case brief

What is this about?

What did the court decide?

M/S.Vijay Silk House(Bangalore) Ltd. v. ---

Case brief

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What did the court decide?

What the court decided

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