2009 (12) TMI 930 - HC - Companies Law

Summary

Issues involved:
Sanction of Court u/s 391 to 394 of Companies Act 1956 for Scheme of Arrangement involving multiple companies and shareholders.

Judgment Details:

Issue 1: Sanction of Court for Scheme of Arrangement
The Court heard the Counsel for the parties seeking sanction u/s 391 to 394 of the Companies Act 1956 for a Scheme of Arrangement involving several companies and their respective shareholders. Separate petitions were filed by different companies before various High Courts for appropriate directions.

Issue 2: Effect of Non-Receipt of Approvals
Clause 5.4 of the Scheme of Arrangement outlined the consequences if the Scheme is not sanctioned by all relevant authorities. It specified that the Scheme would stand implemented without demerger in such cases, with certain provisions invalidated while the rest of the Scheme remains in force.

Issue 3: Compliance and Affidavits
The Petitioner confirmed compliance with all requirements as per Court directions and filed necessary affidavits. The Petitioner also undertook to fulfill all statutory requirements under the Companies Act, 1956 and related rules.

Issue 4: Regional Director's Affidavit
The Regional Director filed an affidavit highlighting various aspects, including foreign investment, necessary approvals, and tax considerations. The Regional Director expressed no objections to the Scheme, stating it does not appear prejudicial to shareholders or the public.

Issue 5: Rejoinder by Petitioner
The Petitioner submitted a rejoinder addressing the Regional Director's contentions. It clarified aspects related to share transfers, foreign exchange transactions, and compliance with regulatory authorities, emphasizing no change in shareholding or foreign exchange transactions.

Issue 6: Fairness and Compliance
The Court found the Scheme fair, reasonable, compliant with the law, and not against public policy. No opposition from concerned parties was noted, and all statutory compliances were fulfilled, leading to the approval of the Company Petition.

Issue 7: Court Order and Clarifications
The Court made the Company Petition absolute, subject to approval by the Delhi High Court for the Transferee's petition. The Order's sanction was specific to the Petitioner in Maharashtra and would not affect Orders from other High Courts involved in the sanction process.

Issue 8: Costs and Dispensation
The Petitioner was directed to pay costs to the Regional Director, and filing of the drawn-up order was dispensed with. All relevant authorities were instructed to act on the Order along with the Scheme and authenticated minutes from the Company Registrar, High Court (O.S.), Bombay.