Allowed

M/S Transport Corporation of India Limited v. -

Telangana HC15 Sept 2010CP/133/2010

Case brief

AI extract

What is this about?

This common order sanctioned and confirmed a scheme of arrangement between two companies under Sections 391 and 394 of the Companies Act, 1956. The court held that no factual or legal hindrance existed for confirming the scheme, subject to the transferee company paying prescribed stamp duty.

What did the court decide?

Sanction and confirmation of the scheme of arrangement; certified copies of orders to be delivered to the Registrar of Companies within 30 days in Form No. 42.

M/S Transport Corporation of India Limited Vs - — Company and Corporate | Telangana HC (2010)

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HONOURABLE SRI JUSTICE G. BHAVANI PRASAD

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C.P.NOs.133 & 134 OF 2010

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DATE: 15.09.2010

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C.P.NO.133 OF 2010

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M/s. Transport Corporation of India Limited, rep. By its Chief Financial Officer, Secunderabad.

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…… Petitioner Company (Transferor Company)

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C.P.NO.134 OF 2010

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M/s. TCI Developers Limited, rep. By its Authorised Signatory Secunderabad.

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…… Petitioner Company (Transferee Company)

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HONOURABLE SRI JUSTICE G. BHAVANI PRASAD

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C.P.NOs.133 & 134 OF 2010

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COMMON ORDER:

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1. The Company Petitions have been filed by the transferor and transferee companies under Sections 391 and 394 of the Companies Act, 1956 requesting for sanction and confirmation of the scheme of arrangement between the transferor and transferee companies as approved by the share holders, secured and unsecured creditors of both the companies so as to bind all the members, creditors, employees and all others concerned with both the companies.

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2. It was stated in both the petitions that the transferor company was incorporated on 02.01.1995 and had changed its name under a fresh

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Certificate of Incorporation on 29.01.1999 with its Registered Office at Sardar Patel Road, Secunderabad. The authorised share capital for the transferor company as on 31.03.2009 is Rs.25,00,00,000/- divided into ten crores equity shares of Rs.2/- each and five lakhs preferential shares of Rs.100/- each. The subscribed and paid-up share capital is Rs.14,50,56,490/-. The Memorandum and Articles of Association of the transferor company prescribed the main objects as carrying on business in real-estate, builders, developers and the like and also undertaking business of financial services, investment in securities, hire purchase, leasing and the like. The company also had among its objects, the business of manufacture etc. in textiles, engineering goods, computer software etc. As on 31.03.2009, the copy of the audited balance sheet of the transferor company is also annexed to the petition. The transferee company was incorporated as a Public Limited company on 14.05.2008 with its Registered Office at Sardar Patel Road, Secunderabad with an authorised share capital of Rs.5.00 crores as on 31.03.2009 divided into equity shares of Rs.10/- each. As on 31.03.2009, the subscribed and paid-up share capital value is Rs.10.00 lakhs. The main object of the transferee company as per the Memorandum and Articles of Association are similar in respect of realestate, builders, developers etc. While the company has also amongst its objects providing infrastructural facilities as builders and developers for all types of structures, resorts, farm houses, godowns and warehouses etc., the copy of the audited balance sheet of the transferee company as on 31.03.2009 was also enclosed to the petition. In order to achieve operational, managerial and administrative efficiency and with a view to concentrate on focused business, the Board of Directors of the company decided to demerge real estate and warehousing undertaking of the transferor company together with all assets and liabilities of such undertaking to the transferee company. The Boards of Directors of the companies at their respective meetings held on 17.03.2010 approved the scheme of arrangement and salient features of the scheme are elaborated and extracted in both the petitions. In C.A.No.439 of 2010,

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the transferor company was directed to have meeting of the equity share holders, secured creditors and unsecured creditors on 10.07.2010 at the specified place by the orders dated 02.06.2010 and accordingly Sri B. Raj Kiran, Advocate, presiding over the meetings as Chairman, conducted the proceedings. Notices of the said meetings were published in advance in ‘Business Standard’ English Daily and ‘Andhra Bhoomi’ Telugu daily as directed by this Court and in the said meetings the share holders, secured creditors and unsecured creditors approved the scheme of arrangement.

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3. In so far as transferee company is concerned, in C.A.No.440 of 2010, this Court dispensed with the convening of meeting of the share holders of the transferee company by orders dated 02.06.2010, as all the share holders gave their no objection for the proposed scheme of arrangement by means of their affidavits.

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4. No investigation or proceedings are pending under the Companies Act, 1956 or any other law against both the companies. Hence, both the companies sought for sanction of the scheme.

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5. In both the company petitions, notices were ordered to the Regional Director, Ministry of Corporate Affairs, Sastri Bhavan, Chennai and Registrar of companies, Hyderabad, apart from ordering general notice by way of publication in ‘Business Standard’ English daily and ‘Andhra Bhoomi’ Telugu daily, Hyderabad editions. The publications were accordingly made.

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6. Sri M. Anil Kumar, learned Counsel for the Official Liquidator and Sri V.S. Raju, learned counsel for the petitioner in both the petitions stated that the Official Liquidator is not a necessary party to these petitions, though notice was ordered to him in both the petitions on 28.07.2010. The Registrar of Companies filed a common affidavit through the Assistant Solicitor General of India only stating about the liability of the transferee company to pay stamp duty wherever applicable as per the Stamp Act.

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7. Sri V.S. Raju, learned counsel for the petitioners again brought to notice of the Court the various annexures to both the petitions, which substantiated the contents of both the petitions. On such material on record, there appears no factual or legal hindrance for confirming the scheme of arrangement, as requested, subject to the liability of the transferee company to pay the prescribed stamp duty wherever required.

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8. Accordingly, both the petitions are allowed and the scheme of arrangement is sanctioned and confirmed so as to be binding on all the members, creditors and employees of both the companies. Certified copies of these orders shall be delivered to the Registrar of Companies by both the companies within 30 days from the date of issue of such certified copies. The order of this Court in both the petitions shall be made in Form No.42, subject to such variations as the circumstances may require in terms of Rule 84 of the Companies (Court) Rules, 1959.

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________________________________ JUSTICE G. BHAVANI PRASAD

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Date:15.09.2010 GK.

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HONOURABLE SRI JUSTICE G. BHAVANI PRASAD

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C.P.NOs.133 & 134 OF 2010

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Date: 15.09.2010

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Gk.

M/S Transport Corporation of India Limited v. -

Case brief

What is this about?

What did the court decide?

M/S Transport Corporation of India Limited v. -

Case brief

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What did the court decide?

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