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2013 (5) TMI 94 - HC - Companies LawAmalgamations - Locus Standi - Challenge the scheme by a person who is neither a shareholder nor a creditor of amalgamating company - The appellants herein/the original applicants are unsecured creditors of VAL, the demerged Company. They filed an application challenging the scheme of amalgamation on various grounds and more particularly on the ground that if the scheme is sanctioned, it would have adverse civil consequences and it would adversely affect their interest. - whether the appellants who are the creditors of the transferee Company are entitled to be heard in the petition filed under Section 391 of the Companies Act, by the transferor Company. Held that - The creditors of the transferee Company would have no right to intervene in the petition filed by the transferor Company under Section 391 of the Companies Act. Reliance was placed on judgment of learned Single Judge of this Court in the matter of Mayfair Ltd. In re [2003 (6) TMI 339 - HIGH COURT OF BOMBAY]. In this petition, learned Single Judge has come to the conclusion that the creditor of the transferor Company would equally have right to file his objection to the scheme which is not just and fair to him or to the class of creditors to whom he belongs. In our view, we respectfully disagree with the view taken by learned Single Judge since the provision of Section 391 of the Companies Act cannot be extended to such extent that even third parties namely those persons who are not shareholders or creditors of the Company can be allowed to intervene in such petitions filed under Section 391 of the Companies Act. It is an admitted position that the appellants who are the creditors of transferee Company namely VAL, the demerged Company were duly heard in the petition filed by the said Company in the Madras High Court for getting their scheme sanctioned and the judgment of the Madras High Court is awaited. If the objection raised by the appellants in the said Court is accepted and the scheme is not approved by the Madras High Court, then, the entire scheme will fail and as such, it cannot be said that there is violation of principles of natural justice. We are, therefore, unable to accept the view taken by learned Single Judge in the said two decisions and overrule the said judgments. In our view, therefore, there is no merit in the contention raised by the learned Counsel appearing on behalf of the appellants. The appeals and the applications, therefore, are dismissed. Decision of Apex Court in National Textile Workers Union (1982 (12) TMI 126 - SUPREME COURT OF INDIA) distinguished.
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