Allowed

Raj Vardhani Enterprises Private Limited, v. -

Telangana HC1 Sept 2014CP/132/2014

Case brief

AI extract

What is this about?

The court sanctioned a scheme of arrangement for the demerger of a Transferor company's real estate business into three new companies. The objection regarding share capital was resolved by ordering the new companies to increase capital by allotting shares within six weeks.

What did the court decide?

The proposed scheme of arrangement is sanctioned with effect from 01.04.2014, subject to the resulting companies increasing their share capital by allotting new shares within six weeks.

Raj Vardhani Enterprises Private Limited, Vs - — Specific Performance | Telangana HC (2014)

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THE HON’BLE SRI JUSTICE C.V. NAGARJUNA REDDY

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COMPANY PETITION Nos.129, 130, 131 and 132 of 2014

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Dated: 01.09.2014

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COMPANY PETITION No.129 of 2014 A S Krishna and Company Private Limited, A company incorporated under the provisions of the India Companies Act, 1913, having its registered office at D.No.4-5-16, New While House, Ring Road, Guntur-522007, Andhra Pradesh, India, Rep. by its Managing Director Mr.Adipudi Soma Raju

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.. Petitioner

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COMPANY PETITION No.130 of 2014 A S Kesanupalli Enterprises Private Limited, A company incorporated under the provisions of the Companies Act, 1956, and having its registered office at #8-3-324, Yellareddyguda, 5B, Pent House Ameerpet, Hyderabad- 500 073, Andhra Pradesh, India, Rep. by its Director Mr. Kesanupalli Venkata Rajanikanth.

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.. Petitioner

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COMPANY PETITION No.131 of 2014 Lakshminarasimha Enterprises Private Limited, A Private Limited Company incorporated under the provisions of the Companies Act, 1956, and having its registered office At Flat No.201, Block 1, Adityahrudayam Apartments, Kondapur,Hyderabad-500084, Andhra Pradesh, India, Rep. by its Director Mr. A. Bhaskar Raju.

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.. Petitioner

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COMPANY PETITION No.132 of 2014 Raj Vardhani Enterprises Private Limited, A private limited company incorporated under the provisions of the Companies Act, 1956, and having its Registered Office at 36/65NA, 4-5-16, New While House, Vidya Nagar, Guntur-522 007, Andhra Pradesh, India, represented by its Director

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Mrs. A. Raja Vardhani.

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.. Petitioner

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Counsel for the Petitioners: Mr. Dinesh Babu Eedi for M/s. Lakshmi Kumaran & Sridharan

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This Court made the following:

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COMMON ORDER:

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C.P.No.129 of 2014 is filed by AS Krishna and Company Private Limited (Transferor company), C.P.No.130 of 2014 is filed by AS Kesanupalli Enterprises Private Limited (Resulting company No.1), C.P.No.131 of 2014 is filed by Lakshminarasimha Enterprises Private Limited (Resulting company No.2) and C.P.No.132 of 2014 is filed by Raj Vardhani Enterprises Private Limited (Resulting company No.3).

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All these petitions have been filed seeking sanction of this Court to the proposed scheme of arrangement, whereby the Transferor company and the Resulting companies 1 to 3 seek to demerge the comprehensive real estate undertaking of the Transferor company, which has three parts/divisions, from the Transferor company and merge each part/division thereof with the Resulting companies 1 to 3, respectively.

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The petitioner in C.P.No.129 of 2014, the Transferor company, has pleaded that it was incorporated on 14.03.1946, that its authorized share capital is

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Rs.65,00,000/- divided into 6,25,000 equity shares of Rs.10/- each and 2,500 7½ fully paid up redeemable preference shares of Rs.100/- each, and that its issued, subscribed and paid up capital is Rs.40,00,000/- divided into 3,75,000 fully paid up equity shares of Rs.10/- each and 2,500 7½ fully paid up redeemable preference shares of Rs.100/- each. That its main objects are to carry on the business of general merchants, tobacco exporters and real estate. It has further pleaded that its Board of Directors, by resolution dated 27.01.2014, has approved the proposed scheme of arrangement, by fixing 01.04.2014 as the appointed date. That as all its shareholders, secured creditors and unsecured creditors have submitted their consent affidavits for the proposed scheme of arrangement in Company Application No.638 of 2014, this Court has dispensed with the requirement of holding their meetings vide its order dated 02.06.2014.

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In C.P.No.130 of 2014, Resulting company No.1 has pleaded that it was incorporated on 08.01.2014, that its authorized share capital is Rs.1,00,000/- divided into 10,000 equity shares of Rs.10/- each and that its issued, subscribed and paid up capital is Rs.1,00,000/- divided into 10,000 equity shares of Rs.10/- each. That its main objects are to carry on the business of software, tobacco and construction of townships. That its Board of Directors, by resolution dated 11.03.2014, has approved the proposed

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scheme of arrangement, by fixing 01.04.2014 as the appointed date. It has further pleaded that as all its three shareholders have given their consent for the proposed scheme of arrangement by way of affidavits filed in Company Application No.639 of 2014, this Court has dispensed with the requirement of holding their meeting by order dated 02.06.2014, and that it has no secured or unsecured creditors.

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It is the pleaded case of Resulting company No.2, petitioner in C.P.No.131 of 2014, that it was incorporated on 21.01.2014, that its authorized share capital is Rs.1,00,000/divided into 10,000 equity shares of Rs.10/- each and that its issued, subscribed and paid up capital is Rs.1,00,000/divided into 10,000 equity shares of Rs.10/- each. That its main objects are to carry on the business of software and construction of buildings. That its Board of Directors, by resolution dated 06.03.2014, has approved the proposed scheme of arrangement by fixing 01.04.2014 as the appointed date. It has further pleaded that as all its three shareholders have submitted their consent affidavits for the proposed scheme of arrangement in Company Application No.640 of 2014, this Court has dispensed with the requirement of holding their meeting vide its order dated 02.06.2014, and that it has no secured or unsecured creditors.

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In C.P.No.132 of 2014, Resulting company No.3 has

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pleaded that it was incorporated on 03.01.2014, that its authorized share capital is Rs.1,00,000/- divided into 10,000 equity shares of Rs.10/- each and that its issued, subscribed and paid up capital is Rs.1,00,000/- divided into 10,000 equity shares of Rs.10/- each. That its main objects are to carry on the business of construction of buildings, structures, houses, apartments, townships etc. That its Board of Directors, by resolution dated 04.03.2014, has approved the proposed scheme of arrangement by fixing 01.04.2014 as the appointed date. It has further pleaded that it has two shareholders, who have given their consent for the proposed scheme of arrangement by way of affidavits filed in Company Application No.641 of 2014, wherein this Court has dispensed with the requirement of holding their meeting by order dated 02.06.2014, and that it has no secured or unsecured creditors.

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In all these petitions, on 25.06.2014, this Court has ordered notice to the Regional Director, South East Region, Ministry of Corporate Affairs, Hyderabad, besides directing the petitioners in C.P.Nos.129 and 132 of 2014 to issue advertisement in Deccan Chronicle (English Daily) and Andhra Bhoomi (Telugu Daily) of Guntur editions and the petitioners in C.P.Nos.130 and 131 of 2014 to issue advertisement in Deccan Chronicle (English Daily) and Andhra Prabha (Telugu Daily) of Hyderabad editions.

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Learned counsel for the petitioners has filed copies of

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proof of publication in the newspapers and stated that in response to the publication, he has not received any claims or objections to the proposed scheme of arrangement.

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In pursuance of the notices issued, the Regional Director, South East Region, Ministry of Corporate Affairs, filed his common report, wherein he has inter alia stated that the Resulting companies have not provided for corresponding increase of their share capital. Subject to this objection, the Regional Director has stated that the Registrar of Companies for the States of Telangana and Andhra Pradesh, at Hyderabad, has reported that all the companies involved in the proposed scheme of arrangement are regular in filing the statutory returns and that no investigations or inspections are pending against the companies.

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At the hearing, the learned counsel for the petitioners stated that as the share capital of each Resulting company is limited to Rs.1.00 lakh, with the merger of undertaking of the Transferor company, they will increase their share capital by allotting new shares by following the procedure prescribed under the amended provisions of Sections 61 and 64 of the Companies Act, 1956.

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In view of the said submission of the learned counsel for the petitioners and considering the fact that the Regional Director, South East Region, Ministry of Corporate Affairs, has not raised any other objection for the proposed scheme

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of arrangement, I do not find any legally sustainable reason for not approving the scheme of arrangement.

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Accordingly, the proposed scheme of arrangement is sanctioned with effect from the appointed date i.e. 01.04.2014, subject to all the three Resulting companies increasing their share capital by allotting new shares, within six weeks from today, under intimation to the Registrar of Companies for the State of Telangana and the State of Andhra Pradesh, at Hyderabad. The petitioners shall, within thirty days from the date of receipt of this order, cause a certified copy of the same to be delivered to the Registrar of Companies and take all other consequential actions in pursuance of the approval of the scheme.

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The company petitions are accordingly allowed.

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________________________ Justice C.V. Nagarjuna Reddy Date : 1-9-2014

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Raj Vardhani Enterprises Private Limited, v. -

Case brief

What is this about?

What did the court decide?

Raj Vardhani Enterprises Private Limited, v. -

Case brief

What is this about?

What did the court decide?

What the court decided

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