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Judgment
R.S. Jha, J.—Heard on the question of admission.
With the consent of the parties, the petition is heard finally.
This company petition has been jointly filed by Aakriti Sugar Mills Private Limited, the transferor company and Ma Bhagwati Sugar Mill Limited, the transferee company under Section 394 of the Companies Act, 1956 praying for sanction of the Scheme of Amalgamation whereby the entire assets, liabilities, etc. of the transferor company which is a going concern with all its assets is proposed to be transferred and vested in the transferee company.
Petitioner no. 1, transferor company i.e. Aakriti Sugar Mills Private Limited was incorporated on 04.02.2013 and its registered office is situated at F-11, 206, Shrishti Complex, M.P. Nagar, Zone-1, Bhopal-462 011 (M.P.).
Petitioner No. 2, transferee company i.e. Ma Bhagwati Sugar Mill Limited was incorporated on 18.12.2006 and its registered office is situated at F-11, 206, Shrishti Complex, M.P. Nagar, Zone-1, Bhopal-462 011 (M.P.).
Admittedly 99% of the entire share capital of petitioner no. 1 transferor company is held by petitioner no. 2 transferee company and therefore the transferor company is a wholly owned subsidiary of transferee company. Both the petitioners seek amalgamation in accordance with the Scheme of Amalgamation Annexure-P/6 which has been approved by all the share-holders, stake-holders, secured creditors and unsecured creditors. The petitioners had filed the first phase petition no. 2/2014 before this Court which was disposed of vide order dated 28.02.2014 dispensing with the holding of a General Body Meeting for approval of the Scheme from the share-holders and secured as well as unsecured creditors looking to the fact that the share-holders and secured creditors as well as unsecured creditors have already given consent and approval to the Scheme in writing. Pursuant to the order passed in the first phase Company Petition No. 2/2014, the present petition has been filed seeking approval of the Scheme of Amalgamation.
Notices were issued by this Court to the Official Liquidator as well as the Registrar of the Companies and the Regional Director, Ministry of Corporate Affairs, Northern-Western Region. All of them have filed their reply.
The official liquidator has not raised any objection to the Scheme of Amalgamation except for stating that transfer of immovable property, if any made by the transferor company to the transferee company would have to be in accordance with law after payment of necessary stamp duty. The petitioners in response have filed a counter affidavit and have stated in paragraph 5 that they undertake to comply with all statutory provisions and as and when occasion or liability arises and have undertaken to discharge all the statutory liabilities towards the payment of Stamp duty, registration charges, etc.
The Registrar of Companies has filed a reply and has stated that there is no complaint and has not objected to the Scheme of Amalgamation. The Regional Director, Ministry of Corporate Affairs, Northern-Western Region has filed a reply supported by an affidavit and while stating that there is no objection to the Scheme of Amalgamation has raised two objections which require to be looked into. First objection is regarding filing of a joint petition and second objection is that the comments of the Income tax Department which were sought by the Regional Director in accordance with the circular of Central Government dated 15.01.2014 were not forthcoming and therefore an appropriate undertaking in that regard be taken.
As far as the first objection is concerned, learned counsel for the petitioners have relied upon the decision of this Court rendered in Company Petition No. 25/2013 decided on 07.01.2014 wherein this Court relying on the judgment of the Madras High Court in the matter of W.A. Beardsel & Co. (P) Ltd. (1968) 38 Company Cases 197, Delhi High Court in the matter of Mohan Exports India Ltd. Vs. Tarun Oversees Pvt. Ltd. (1999) 95 Company Cases 53 and the judgment of Karnataka High Court in the matter of In Re: Chembra Orchard Produce Ltd., , has held that there is no bar under the Act or Rules for filing a joint petition which can be permitted in case there is no conflict between the parties and they jointly agree to the Scheme of Amalgamation with a view to avoid multiplicity of petitions and in case the petition is based on common question of fact and law. In the instant case, it is observed that the transferee company is the major share-holder in the transferor company and the transferor company is a fully owned subsidiary of the transferee company and that the Scheme of Amalgamation has been prepared with the consent of all concerned. It is also observed that this Court in the first phase petition has already exempted holding a General Body Meeting in view of the consensus and consent of all party involved and interested.
In view of the aforesaid fact, the first objection raised by the Regional Director is hereby overruled and the petitioners are permitted to file a joint petition.
As far as second objection is concerned, the petitioners in paragraph 5.8 the Scheme of Amalgamation itself have already agreed that all taxes (including but not limited to income tax, sales-tax, excise duty, customs duty, service tax, VAT, etc.) paid or payable by the transferor company in respect of the operations prior to appointed date shall be on account of the transferee company and shall be borne by the transferee company. The Scheme of Amalgamation also envisages that all its subsequent tax liabilities would be borne by the transferee company.
In view of the aforesaid, the second objection raised by the Regional Director is satisfied in view of the Scheme of Amalgamation.
As stated above, apart from the aforesaid objections, the Official Liquidator, Registrar of Companies and the Regional Director have approved the Scheme and have expressed an opinion that the Scheme of Amalgamation is not prejudicial to the interest of the share-holders, creditors and the public at large.
In view of the aforesaid, the Scheme of Amalgamation Annexure-P/6 filed alongwith the petition is hereby approved. The said Scheme may be read as part of this order. The petitioners shall lodge a copy of this order alongwith copy of Scheme of Amalgamation before the Office of Registrar of Companies within 30 days and for that purpose the order passed by this Court and the Scheme may be duly authenticated by the Registrar of the High Court.
The petitioners shall pay a cost of Rs. 25,000/- (Rupees Twenty Five Thousand) to the Official Liquidator for deposit in the Common Pool Fund maintained by the Official Liquidator within four weeks from today.
The petitioners shall also pay a sum of Rs. 10,000/- (Rupees Ten Thousand) each to the Counsel of the Regional Director and the Official Liquidator.
Petitioner No. 1 transferor company shall stand dissolved without winding-up.
Filing and issuance of a drawn-up order is dispensed with.
All proceedings now pending by or against transferor company may be continued by or against the transferee company. All concerned authorities shall henceforth act on the copy of order alongwith Scheme duly authenticated by the Registrar of this Court.
With the aforesaid directions, the petition stands disposed of.