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2016 (3) TMI 553 - DELHI HIGH COURT

2016 (3) TMI 553 - DELHI HIGH COURT - TMI - Scheme of amalgamation - whether the non-receipt of communication issued to seek consent/ no-objection to the then proposed scheme of amalgamation would effect the said scheme as ultimately, sanctioned? - Held that:- The applicant, if anything else, would be deemed to have knowledge of the proceedings pending in this court for obtaining sanction of the then proposed scheme of amalgamation. Undoubtedly, an affidavit was filed at the relevant stage by th .....

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reas in numbers, 27 out of the 28 shareholders, in transferor company no.9, had given their consents.

Similarly, in so far as transferor company no.10 was concerned, 79% in value, had given their consents. In terms of numbers, 11 out of the 12 shareholders of transferor company no.10, had given their consents.Quite clearly, a majority comprising of more than 3/4th in value of the shareholders in both, transferor company no.9 and 10, had given their consents. Therefore, even if, it is .....

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d, help the cause of the applicant. Therefore, find no merit in the application. It is, accordingly, dismissed. - CO. PET. 287/2012 - Dated:- 15-3-2016 - Rajiv Shakdher, J. For the Applicant : Mr. Sudhanshu Batra,Sr.Advocate with Mr. Ashish Aggarwal and Mr. Ashish Virmani, Advocates Mr. Jayant K. Mehta and Mr. Rishi Sood, Advocate ORDER Rajiv Shakdher, J. CA No. 321/2014 1. This is an application filed by objector by the name of D.D. Global Capital Ltd., seeking recall of order dated 20.02.2013, .....

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& Promoters Private Limited. The applicant was allotted, prior to the amalgamation, 103200 shares of a face value of ₹ 10 each at a premium of ₹ 490 per share in transferor company no. 9. Thus, the applicant, paid an issue price of ₹ 500 per share, and thereupon, expended a total amount of ₹ 5.16 crores. Similarly, the applicant bought 22590 shares, of a face value of ₹ 100 each, at a premium of ₹ 4900 per share of transferor company no. 10. The applicant .....

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e applicant or BDR. 2.2 The applicant is, principally, aggrieved by the fact that no sooner did it make the investment in the transferor company no. 9 and 10, a scheme of amalgamation was proposed which involved, inter alia, amalgamation of these two companies along with ten other companies with BDR. The applicant claims that prior to the sanction of the scheme of amalgamation, by this court, it held 4.50% and 21% of the equity stake in transferor company no. 9 and 10 respectively, which, upon a .....

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whereas, in respect of shares held in transferor company no. 10, the applicant is entitled to issuance of 2,71,080 shares. 3. In this context, the applicant raises the following grievances, as articulated by its counsel. Submissions on behalf of the applicant were made by Mr Jayant Mehta, Advocate, while, on behalf of BDR, arguments were advanced by Mr Sudhanshu Batra, learned senior counsel. 3.1 Mr Mehta, learned counsel for the applicant, submitted that the order dated 20.02.2013 needed to be .....

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ake of the applicant in the BDR has been considerably scaled down, it could not have been in the best interest of the applicant and in any event was contrary to public interest. 4. On the other hand, Mr Batra, learned senior counsel for BDR made the following submissions: (i) That notices were dispatched to the shareholders of the various transferor companies, including the applicant, to seek their consent/ no-objection to the then scheme of amalgamation. Consents of the shareholders and credito .....

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. 10 is concerned, 79% (in value) had given their consent. As regards number of share holders, who had given their consent, it was submitted, that 11 out of 12 shareholders of transferor company no. 10, had given their consent. (iv) This apart, it was contended that in so far as matters pertaining to valuation of shares and fixation of share exchange ratio are concerned, these are aspects, which are within the domain of the concerned companies and, therefore, this court would not sit in an appea .....

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(Delhi Edition)] and Veer Arjun [Hindi (Delhi Edition)]. The argument advanced was that, assuming without admitting, the applicant did not receive the communication seeking its consent/ no-objection with regard to the, then, proposed scheme of amalgamation, it surely, had received notice at the second motion stage. (vi) In view of the above, Mr Batra also adverted to the fact that on 08.03.2013, two separate communications were sent to the applicant seeking surrender of the original share certi .....

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ch was, inveigled in disputes with BDR. In support of this submission, it was also contended that criminal proceedings initiated, were pending before concerned forums. 5. Having heard the learned counsel for the parties, what is primarily to be decided in the present proceedings is: as to whether the non-receipt of communication issued to seek consent/ no-objection to the then proposed scheme of amalgamation, in the facts and circumstances of this case, would set at naught the order dated 20.02. .....

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um of ₹ 5.16 crores in transferor company no. 9, while a sum of ₹ 11,20,50,000/-, was invested, in the shares of transferor company no. 10. 6.1 Ordinarily, if such a huge investment was made, the applicant would have, to my mind, ensured that due diligence was carried out and the requisite papers, which led to investment of such substantial amounts, would have been filed with the application. This aspect I must state was brought to fore during the course of the arguments. 6.2 Be that .....

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s companies, which included the transferor company no. 9 and 10, have been appended. 6.4 Having said so the question is: would this assertion of the transferee company by itself suffice? 6.5 Answer to this question would depend on the facts and circumstances obtaining in each case. Having said so, it is well settled that inadvertent omission or a bonafide mistake in failing to issue notice under Section 391 of the Companies Act, 1956 is not fatal to the resolution passed at a meeting either of t .....

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ed from shareholders of transferor company no.9 which amounted to 95.5% in value, whereas in numbers, 27 out of the 28 shareholders, in transferor company no.9, had given their consents. 6.7 Similarly, in so far as transferor company no.10 was concerned, 79% in value, had given their consents. In terms of numbers, 11 out of the 12 shareholders of transferor company no.10, had given their consents. 6.8 Quite clearly, a majority comprising of more than 3/4th in value of the shareholders in both, t .....

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e observations made in the case of : Bhagat Ram Kohli V. Angel s Insurance Co. Ltd., Delhi, 1937, 007 C-C 0161, which were based on somewhat similar provision obtaining in the Indian Companies Act, 1913, being apposite, are extracted hereafter :- ..1. That Mr. Bhagat Ram Kohli not having been served with a notice of any of the meetings that were held between the Company and its creditors was not bound by the decision arrived at in those meetings; and 2. That he being a judgment-creditor did not .....

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pany in the absence of any individual creditor. On the other hand, at page 364 of Rustomji s Company Law a case has been cited in which it was held that where there was an inadvertent omission to advertise a scheme of arrangement under Section 153 but it was satisfactorily proved that thirty out of thirty one shareholders of the Company had received the notices, the meetings had in substance been held in the manner prescribed and the Court would not insist on further meetings being convened. Mor .....

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itors or members and the company. In the case before us, it is not urged that the majority required by sub-section (2) was not present or had not been notified and, in these circumstances, the objection raised by Mr. Bhagat Ram cannot prevail… (emphasis is mine) 7.1 There is another aspect of the matter, which is that, the facts and circumstances, as obtaining in this case, would demonstrate that the applicant had knowledge of the pendency of proceedings, in this court, at the second moti .....

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