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TMI Blog2009 (1) TMI 477X X X X Extracts X X X X X X X X Extracts X X X X ..... ing its registered office in the State of Haryana, has filed a separate petition under the said section before the High Court of Punjab and Haryana seeking approval and sanction of the scheme. 4. The petitioner, which is a transferee company, was incorporated on 13-5-1958, having its registered office at Ammasandra, Tumkur District, Karnataka and the memorandum and articles of association of the company are produced as annexure B. The main objects for which the petitioner-company has been established are to produce, manufacture and trade and generally to deal in cement and its by-products and building materials and in that connection to acquire, erect, construct, establish, operate and maintain cement factories, limestone quarries, workshops and other works and also to take on lease or otherwise acquire any company or companies carrying out business as manufacturers of cement in India or elsewhere to deal in the business of manufacture and sale of other allied products of cement and to carry out the business of metallurgy and deal in metals, minerals and its by-products and to work in mines and quarries and generally to carry over the business of mining in all its branches. Clause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 1 as on 30-6-2007, is produced as annexure E to the company petition. 10. The objects of transferor company No. 1 as per its memorandum of association is to carry on the business as manufacturer and dealer and establish various kinds of premixed cement concrete and allied products and by-products and to construct, acquire, run, operate any factory for manufacturing cement and allied products. 11. Clause III(B)(22) of the objects of transferor company No. 1 contemplates and authorises amalgamation of the said company with the other companies. 12. Transferor company No. 2 [Heidelberg Cement India (P.) Ltd.] was incorporated on 9-11-2006, in Gurgaon, Haryana State, under the provisions of the Act, having its registered office at 9th Floor, Tower C, Infinity Towers, DLF Cyber City, Gurgaon-122 002. The certified copy of the memorandum and articles of association of transferor company No. 2 is produced as annexure F. The main objects for which transferor company No. 2 has been established as per the memorandum of association are, to produce, manufacture, purchase, trade and generally to deal in cement and various kinds of cement products and to acquire and establish and maintain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under the laws of Netherlands having its principal place of business at Sint Teunislaan 1. NL-5231 BS, Hertogenbosch, the Netherlands ("Cementrum" for short) and transferor company No. 2 is a 100 per cent wholly owned subsidiary of Cementrum. In view of the common business prospects, the management has considered it appropriate to merge the transferor companies into the petitioner-company. The scheme of amalgamation has been considered so as to achieve consolidation of cement business and to the benefit of interest of the shareholders, creditors and employees of all the three companies and the interest of the general public at large so as to create greater synergies between the businesses of all the companies which would enable them to have access to better financial resources, increase the managerial efficiencies, effectively pooling the technical, distribution and marketing skills and enable Cementrum to consolidate its cement business in India. Therefore, as per the scheme, the entire undertaking the business of the transferor companies shall be transferred to and vested in the petitioner-company (transferee-company) and the transferor companies are collectively referred to as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsidering and approving the scheme of amalgamation and accordingly directed Mr. Ashish Guha or in the alternative Mr. Amitabha Ghosh, to act as the chairman of the said meeting and file a report to this court. Subsequently, notice of the said meeting is said to have been sent individually to each of the shareholders of the petitioner-company and the meeting of the equity shareholders was also advertised as directed by this court in one edition of The Hindu and Udayavani dated July 2 and July 15, 2008 as per annexure P. The meeting of the equity shareholders of the petitioner-company was convened on 6-8-2008, at Mysore Cements Ltd. Auditorium, Amma-sandra and chaired by Mr. Amitabha Ghosh and the chairman's report is produced at annexure Q. 21. In the meeting of the equity shareholders, out of 68,607 equity shareholders, 254 shareholders were present in person or through their authorised representatives or by their duly constituted proxies and out of the said 254 shareholders, 253 of them voted in favour of the scheme and one ballot was declared as invalid and no equity shareholders objected against the scheme and according to the petitioner, the scheme has been approved by the eq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Preeti Dayanand Naik, learned counsel for the Registrar of Companies. 24. Learned senior counsel for the petitioner while taking me through the documents annexed to the petition and on highlighting the main objects of the three companies and the salient features of the scheme of amalgam-ation, has submitted that the existing authorised share capital of transferor company No. 1 and transferor company No. 2 would stand transferred to the transferee company and with the consent of the shareholders to the scheme is sufficient for the purpose of effecting this amendment under sections 16, 81 and 94 to 97 of the Companies Act and it is not necessary to pass further resolutions in this regard and that no registration fee or stamp duty can also be chargeable against the transferee company. He further submits that when once the sanction of the scheme is accorded by this court, it would be a sanction for all purposes and compliance that has to be made under the Companies Act, i.e., sections 100 to 102 as well as section 21. He further submits that there is no investigation which has been instituted or pending under sections 235 to 251 of the Act against the petitioner-company and that the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bing of the authorised capital of the transferor company to that of the transferee company cannot be a part of the scheme since section 97 of the Companies Act, 1956, is only a procedural compliance requiring filing of the prescribed return and payment of registration fee to the Registrar of Companies and payment of stamp duty to the State Government, which has to be statutorily complied with. In this connection, it is also respectfully submitted that the Original Side Appeal No. 26 of 2007 filed by the Regional Director against the decision of this hon'ble court overruling the objections raised by the Regional Director in a similar case is pending before the Division Bench of this hon'ble court." 26. Learned counsel for the Regional Director has relied upon a decision of the hon'ble Supreme Court in the case of Ratnabali Capital Markets Ltd. v. SEBI [2007] 140 Comp. Cas. 677 , in support of her submission with regard to payment of registration fee to the Registrar of Companies and for payment of stamp duty to the State Government. 27. In response, the petitioner has filed an affidavit of the authorised representative of the company to contend that the objections raised by the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pecial procedure to be followed, except reduction of capital, the court has the power to sanction them while sanctioning the scheme itself. Section 391 is a complete code and is intended to be in the nature of "single window clearance" system to ensure that the parties are not put to avoidable, unnecessary and cumbersome procedure of making repeated applications to the court for various other alterations or changes which might be needed effectively to implement the sanctioned scheme, whose overall fairness and feasibility has been judged by the court under section 394 of the Act. 31. In view of the said decision, it can be held that before sanctioning any amalgamation, notice to the Registrar of Companies is issued for the purpose of taking into consideration the objection, if any, made to it by the Registrar of Companies before passing any order of sanction. There is no reason why the Registrar of Companies cannot raise all its objections at this stage. It would then be possible for the court to appreciate the objections, if any, and adjudicate thereupon. If the court is satisfied that the objection based on the alteration of the memorandum has no substance, the court itself can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dened with taking various applications which are cumbersome in nature. 33. Hence, the petitioner in the instant case is directed to file necessary forms as prescribed in law in the office of the Registrar of Companies to place on record the changes with regard to the name of the company. 34. The other objection of the Regional Director is that clause 4.1 of the scheme contemplates merger of the transferor company with that of the transferee company without making payment of registration fee and stamp duty, but in the event of the authorised capital of the transferee company being increased, then it (petitioner-company) has to comply with the provisions of sections 94 and 97 of the Act by filing necessary returns with the Registrar of Companies along with the registration fee. The answer of the petitioner-company to this objection is that the authorised capital of the transferor company is being combined with that of the transferee company under the scheme, which is legally permissible and for which separate compliance under sections 94 and 97 of the Companies Act is not necessary as per ratio of several decisions. It is further submitted by learned senior counsel by placing relia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Ltd.'s case (supra), being reversed by the Division Bench in appeal, then, the petitioner would undertake to pay the requisite stamp duty. To the same effect it is also stated in paragraph 9 of the affidavit of the authorised representative of the petitioner-company dated 17-10-2008. Therefore, recording the undertaking of the petitioner for the present, the payment of the requisite stamp duty and registration fees is held to be not required by the petitioner-company. 37. As per the proposed scheme, 6,77,21,681 and 8,81,670 equity shares of the face value of Rs. 10 each of the transferee company shall be issued in total to the equity shareholders of transferor company No. 1 and transferor company No. 2, respectively. The same is based on the recommendation of M/s. BMR Advisors (P.) Ltd., chartered accountants which was appointed as the valuer for the purpose of amalgamation based on the valuation report, the share exchange ratio was determined by taking into consideration all relevant factors which has been approved by the transferor companies as well as the transferee company. Since the exchange ratio of the shares have been determined by the chartered accountants and the same ..... X X X X Extracts X X X X X X X X Extracts X X X X
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