2005 (10) TMI 287 - HC - Companies Law

Summary

Issues:
1. Sanction of proposed scheme of amalgamation by High Court of Allahabad.

Detailed Analysis:
1. The confirmation petition was filed by the transferee company and transferor company seeking approval for the proposed scheme of amalgamation. The scheme involved the transferor company being amalgamated into the transferee company as per the annexed scheme of amalgamation.
2. Separate meetings of equity shareholders were held for both companies as directed by the court. The meetings were duly conducted, attended by shareholders representing 100% of shareholdings for each company, and the scheme was unanimously approved without modifications.
3. The company petition was filed seeking sanction for the proposed scheme of amalgamation. Notices of the petition were published in newspapers and served on relevant authorities. Affidavits confirming the service of notices and filing of original documents pertaining to meetings were submitted.
4. The Official Liquidator verified in his report that the affairs of the transferor company were not conducted in a prejudicial manner. The Regional Director raised concerns about the authorized share capital of the transferee company.
5. The Regional Director suggested that the transferee company should increase its authorized capital to accommodate the transferor company's share capital. However, the counsel for the petitioners argued that the scheme allowed for an automatic increase in the authorized share capital of the transferee company without additional fees.
6. The court referred to a previous judgment where a similar objection by the Regional Director was overruled, stating that no further fees or stamp duty were required for the amalgamation. The court held that the objections raised were not tenable, and the scheme complied with legal requirements.
7. No other objections were raised against the scheme of amalgamation. The court found that all statutory requirements had been met, and the scheme deserved to be sanctioned.
8. The court allowed the company petition, confirming the scheme of amalgamation to come into effect from the appointed day specified in the scheme. The transferor company was to be dissolved without a winding-up order, and a formal order was to be issued by the office within one month for filing with the Registrar of Companies within the prescribed period under the Companies Act.