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Judgment
Shiv Kumar Sharma, J.—The applicant Balaji Industrial Products Limited (Applicant Transferor Company) and Balaji Industrial Engineering Limited (Applicant Transferee Company) filed this application u/s 391 of the Companies Act, 1956 (hereinafter shall be referred to as the Act of 1956) praying as under:
(i) necessary directions may be given as to the issue and publication of notices and the convening, holding and conducting of the separate meetings of secured and unsecured creditors of the applicant Transferor Company, and
(ii) the meeting of the members of the Applicant Transferor Company may kindly be dispensed with.
(iii) the meeting of the members of the Applicant Transferee Company may kindly be dispensed with.
(iv) Any other order which this Hon''ble Court may deem fit in the facts and circumstances of the case may kindly be passed.
Balaji Enterprises Pvt. Limited was incorporated on November 21, 1983 with the Registrar of Companies Jaipur. The company changed its name to Balaji Industries Private Limited vide certificate of incorporation dated May 24, 1993 subsequently converted into a public limited company vide fresh certificate of incorporation on May 21, 1993 and name was subsequently changed to Balaji Industrial Products Ltd. (Transferor Company) With effect from April 8, 1994.
The position authorized issued, subscribed and paid up capital of the applicant transferor company as on date is detailed out in para No. 4 of the application.
The main objects of the applicant transferor company as set out in the object clause of its Memorandum of Association, have been detailed out in para No. 5 of the application. The copy of the latest audited annual accounts of the applicant transferor company for the year ended on March 31, 2008 has been submitted as Annexure D to the application.
Balaji Industrial Engineering Limited (Transferee Company) was incorporated on February 26, 2008 and received the certificate of commencement of business on March 18, 2008 from the Registrar of Companies, Jaipur.
The position authorized issued, subscribed and paid up capital of the transferee applicant company as on date is detailed out in para No. 9 of the application.
The main objects of the transferee applicant company as set out in the object clause of its Memorandum of Association, have been detailed out in para No. 10 of the application.
It is averred in the application that by proposed scheme of arrangement (Annexure F enclosed with the application) u/s 391 to 394 of the Companies Act, the transferor company seeks to transfer by way of demerger the Barajamada (Jharkhand) division (Demerged Undertaking) to the transferee company, by issuance of shares by the applicant transferee company to the shareholders of the applicant transferor company. The share exchange ratio has been determined by the Board of Directors of the applicant companies after taking into consideration the report give by an independent chartered accountant. It is averred that the demerger shall enhance the scope for independent collaboration with strategic investors and it shall improve the operational efficiencies. The demerger would also benefit the shareholders, creditors employees and stakeholders of both the companies. The applicant Transferor Company has 14 members, 4 secured creditors and several unsecured creditors. All the shareholders of the applicant transferor company have given their consent to the proposed scheme of arrangement. The applicant transferee company has only 7 members. These members have given their consent to the proposed scheme of arrangement. The applicant transferee company has neither secured nor unsecured creditors. It was prayed that their meetings may be dispensed with. It was suggested that separate meetings of the secured creditors and unsecured creditors of the applicant transferor company may be held at the registered office of the applicant transferor company. No proceedings u/s 235 to 251 of the Companies Act are pending against the applicant companies.
Having heard the learned Counsel for the applicant companies, on perusal of the entire application, it is ordered that the meetings of 14 members of applicant transferor company and 7 members of transferee company are dispensed with. It is further ordered that the meetings of secured creditors and unsecured creditors of the applicant transferor company for the purpose of considering and if thought fit, approving with or without modifications, the scheme of arrangement aforesaid shall be convened and held as per the following schedule-
Name Date and time Place Secured creditors of the 29.9.2008 Registered company 3.00 p.m. applicant transferor Office of Company
Un-secured creditors of 29.9.2008 Registered company 4.00 p.m. the applicant transferor Office of company
At least 21 clear days before the days fixed for the meetings an advertisement convening the same and stating that copies of the said scheme of arrangement and of the statements required to be furnished shall be furnished pursuant to Section 393 of the Act, 1956 and forms of proxy can be obtained free of charge at the office of the applicant transferor company or from the office of their advocate be advertised once in the dailies namely, English News paper - Indian Express (in English - Delhi Edition) and Hindi News paper - Rajasthan Patrika (in Hindi - Jaipur Edition).
At least 21 clear days before the meetings to be held as aforesaid a notice convening the said meetings at the place and time aforesaid, together with the copy of the said scheme of arrangement, a copy of the statement required to be sent u/s 393 of the Act, 1956 and the prescribed form of proxy, shall be sent by prepaid post under certificate of posting addressed to each of the secured creditors and unsecured creditors, whose meetings are to be held at the registered addresses.
The advocates for the applicant transferor company do, within the time as they consider necessary and at least within three days, file in Court the forms of the advertisement, the notices and statement to accompany the notices, and the same shall be settled by the Registrar of this Court.
Shri Virendra Dangi, Advocate Rajasthan High Court, Bench Jaipur shall be the Chairman of the meetings of the secured creditors and unsecured creditors, to be held on September 29, 2008 as aforesaid. The applicant transferor company shall deposit in the court or pay within one week from today an amount of Rs. 30,000 (Thirty thousand) towards remuneration to the Chairman for presiding the meetings aforesaid. The applicant transferor company shall also bear the expense of conveyance of the the Chairman for the said meeting.
The Chairman appointed for the meetings through applicant Company, do issue the advertisement and send out the notices of the meeting referred to above.
The quorum for the said meetings shall be as per the provisions of the Act, 1956.
Voting by proxy be permitted, provided that a proxy in the prescribed form duly signed by the person entitled to attend and vote at the meeting, is filed with the applicant transferor company at their registered office, aforesaid not later than forty eight hours before the meeting scheduled to be held.
The value of each secured creditors and unsecured creditors shall be in accordance with the books of the applicant transferor company company where the entries in the books are disputed the Chairman shall determined the value for purposes of the meetings
And it is further ordered that the Chairman do separately report to this Court the result of the said meetings within seven days of the conclusion thereof, and the said reports shall be verified by his affidavit.
With these directions the application accordingly stands disposed of.