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2009 DIGILAW 586 (GUJ)

In re, IDEA Cellular Limited v. .

2009-08-31

JAYANT PATEL

body2009
JUDGMENT : Jayant Patel, J. The present petition has been preferred by the petitioner seeking sanction to the scheme of arrangement between the company and its shareholders. The copy of the scheme of arrangement is produced at Annexure – C. It appears that as per the scheme the amount of Rs. 54,397.50 lacs which has paid by the petitioning company to MCPL towards Non-Compete Fee is proposed to be set off from the balance available in the Share Premium Account of the petitioning company. As under Section 78 of the Companies Act, the money available in the Share Premium Account is required to be dealt with by following the procedure as required for alteration or reduction of the share capital as per Section 100 and other relevant provision, the present petition seeking sanction. 2. It appears that vide order dated 18.04.2009 passed in Company Application No. 172 of 2009, the meeting of the equity shareholders was ordered to be convened for consideration of the scheme of arrangement. However, so far as secured and unsecured creditors are concerned, the petitioning company, with a view to have the views of the secured and unsecured creditors upon the scheme of arrangement, had declared for convening of the meeting and therefore it was also ordered by this Court to convene the meeting of the secured and unsecured creditors for expressing their views upon the scheme which may be required to be considered by this Court. It appears that thereafter the Chairman has filed the report and the report shows that the scheme of arrangement has been approved by the requisite majority of the shareholders and it is also approved by the secured creditors with the requisite majority both present and voting at the meeting in number and in value. All unsecured creditors have unanimously approved the scheme of arrangement. 3. The present petition came to be admitted on 13.07.2009 and it was ordered to be published in 'Times of India', English daily and 'Gujarat Samachar', Gujarati daily keeping 21 days' clear notice. Publication in the Official Gazette was dispensed with. 4. The affidavit has been filed dated 28.07.2009 on behalf of the petitioning company reporting compliance to the order for publication and together with the said affidavit the relevant extracts of the newspaper are also produced. Publication in the Official Gazette was dispensed with. 4. The affidavit has been filed dated 28.07.2009 on behalf of the petitioning company reporting compliance to the order for publication and together with the said affidavit the relevant extracts of the newspaper are also produced. The another affidavit is also filed dated 24.08.2009 on behalf of the petitioning company stating that neither the petitioning company nor its advocate has received any objection in response to the publication. 5. Notice was also issued to the Central Government through Regional Director, Ministry of Corporate Affairs. 6. In response to the notice issued to the Central Government, Shri R.K. Dalmia, Deputy Registrar of the Companies has filed the affidavit based on the correspondence received by the Registrar of Companies dated 19th August, 2009 from the office of the Regional Director. The first objection pertains to the aspect that such an adjustment of the amount lying in the Share Premium Account is not available in normal course for such write off in Non-Compete Fees. 7. The consideration of the said objection shows that it may be that in normal course such may not be available but the learned Assistant Solicitor General Mr. Champaneri has not been able to show any provision of the Companies Act prohibiting such an adjustment from the Share Premium Account. Further, when the equity shareholders, who may have legitimate claim, by requisite majority in number and value present and voting at the meeting, have approved the scheme, such objection can hardly be sustained as against the commercial wisdom of the equity shareholders unless any bar of statute is brought to the notice of this Court. Hence, the said objection cannot operate as a bar for denying the sanction. 8. The other two objections relate to alleged violation by the petitioning company on the basis of the figure mentioned in the balance-sheet and the another objection is for future initiation of the action based on the complaint received from SEBI. 9. Both the aspects are already covered and dealt with by this Court in the order passed in Company Petition No. 167 of 2009 wherein this Court has observed that such aspects shall remain open and the sanction granted by this Court shall not operate as a bar to any such action or proceedings in accordance with law. 9. Both the aspects are already covered and dealt with by this Court in the order passed in Company Petition No. 167 of 2009 wherein this Court has observed that such aspects shall remain open and the sanction granted by this Court shall not operate as a bar to any such action or proceedings in accordance with law. In view of the above observation, the same is not required to be considered separately once again in the present petition which is altogether for a different purpose for seeking sanction to the scheme of arrangement. 10. No other adverse circumstances are brought to the notice of this Court. 11. Hence, the present scheme of arrangement at Annexure – C is sanctioned in accordance with the provisions of the Companies Act. 12. The cost of the Central Government is quantified at Rs.3,500/-. It will be open to the petitioning company to pay the cost to the learned Assistant Solicitor General Mr. Champaneri directly by A/c. Payee Cheque. 13. Petition is allowed to the aforesaid extent. Petition allowed.