Research › Search › Judgment

Gujarat High Court · body

2014 DIGILAW 395 (GUJ)

ADANI AGRO PRIVATE LIMITED v. .

2014-03-18

S.R.BRAHMBHATT

body2014
COMMON ORAL JUDGMENT 1. These are the petitions filed by the petitioner Companies for sanction of a Scheme of Arrangement in the nature of Amalgamation of Adani Agro Private Limited, B 2 B India Private Limited and m to M Traders Private Limited with Adani Properties Private Limited under section 391 and 394 of the Companies Act, 1956. It has been contended that the amalgamation is proposed for the purpose of consolidation of its holdings into a single entity instead of its scattered holding and thereby realign the corporate structure. The petitions give in details the benefits envisaged due to the scheme. 2. It has been pointed out that vide the orders dated 27th November 2913, passed in Company Application Nos. 297, 298 and 299 of 2013, the meetings o the Equity Shareholders and Unsecured Creditors of all the petitioner companies were dispensed with in view of the written consent letters placed on record. It has been pointed out that there are no Secured Creditors of any of these companies. 3. The substantive petitions were admitted vide order dated 12th December 2013. The public notices for the same were duly advertised in the newspapers ‘Indian Express’ English daily, and ‘Sandesh’ Gujarati Daily, both Adhmedabad editions dated 24th December 2013, and the publication in the Government Gazette was dispensed with. Affidavits dated 6th January 2014 confirm the same. No one has come forward with any objections to the said petitions even after the publication. The same has been further confirmed by the additional affidavit dated 10th March 2014. 4. Notice of the petition of the Transferor Companies were served upon the Official Liquidator attached to Gujarat High Court. Vide the respective reports dated 3rd March 2014, filed by the Official Liquidator, it is observed that the affairs of the Transferor companies have not been conducted in a manner prejudicial to the interest of their members or to the public interest. However, the Official Liquidator has requested this Court to direct the Transferor Companies to maintain respective books of accounts and records for a period of eight (8) years from the date of sanctioning the scheme and not to dispose off the same without prior permission of the Central Government. However, the Official Liquidator has requested this Court to direct the Transferor Companies to maintain respective books of accounts and records for a period of eight (8) years from the date of sanctioning the scheme and not to dispose off the same without prior permission of the Central Government. The Transferor companies are accordingly directed to keep their books and records for a period of eight yeas from the date of sanctioning the scheme and not to dispose off the same without prior permission of the Central Government. 5. Notice of the petitions have been served upon the Central Government and Shri M.I.A. Shaikh, Learned Standing Counsel appearing for the Central Government. A common affidavit dated 5th March 2014 has been filed by Mr. Shambhu Kumar Agarwal, the Regional Director, North Western Region, Ministry of Corporate Affairs, whereby several observations have been made. 6. The attention of this Court is drawn to the common additional affidavit dated 10th March 2014, whereby the explanations have been given for each of the observation made vide the aforesaid affidavit of the Regional Director. It has been pointed out that- (i) The first three observations made vide para 2 (a), (b) and (c) of the said affidavit refers to the factual aspects pertaining to the proposed scheme and the same does not require any response. (ii) The observation made vide para 2 (d) pertain to the Appointed Date/s proposed under the scheme. It has been pointed out by the Regional Director that clause 1 (ii) of the scheme envisages two separate Appointed Dates viz. 1st day of October 2013 in respect of amalgamation of AAPL & BBIPL with APPL and 3rd October 2013 in respect of amalgamation of mMTPL with APPL. It has been submitted by the Regional Director that there is no justification for keeping two separate appointed dates and the Hon’ble Court should direct the petitioner companies to choose any one Appointed Date for the entire scheme. In this regard, it is respectfully submitted that there is no legal bar on the choice of the Appointed Date. It is the prerogative of the Board of Directors of the petitioner companies to select the Appointed Date for the Scheme. The same is required to be approved by the shareholders of the respective petitioner companies. Both these requisites have been complied with in the present proceedings. It is the prerogative of the Board of Directors of the petitioner companies to select the Appointed Date for the Scheme. The same is required to be approved by the shareholders of the respective petitioner companies. Both these requisites have been complied with in the present proceedings. Considering the submissions, in my view, it is not necessary to prescribe a common Appointed Date. (iii) The next observation made vide para 2(e) of the affidavit pertain to the Exchange Ratio working based on the valuation report prepared by M/s Mrunal N. Shah & Co.; Chartered Accountants. It has been observed by the Regional Director that the exchange ratio recommended n case of Transferor Company no.2 viz. B 2 B India Private Limited, is not justified because it is proposed that the Transferee Company shall issue 1 (one) share to each of the shareholder irrespective of their holding in the shares of Transferor Company no.2. In this regard, it has been already been pointed out that the value of the shares of the said company is negative. It has also been pointed out that all the shares of the said Transferor company are held by S.B. Adani family trust through its nominees. Since there is no public interest or minority interest involved in the present case, it is absolutely immaterial to find justification in the ratio fixed and approved by a Chartered Accountant as fair and reasonable. It is interesting to note that all the concerned shareholders have approved the scheme and have not objected to the proposed exchange ratio. In the given facts and circumstances, the said issue is outside the purview of the Regional Director and the said observation need not be considered relevant for the sanction of the scheme by the Court. (iv) The next observation of the Regional Director made vide para 2 (f) pertains to the inspection under Section 209 A of the Act, undertaken in case of Adani Agro Private Limited and Adani Properties Private Limited. It has been observed that the supplementary inspection and other directions are likely to be undertaken in this regard and the direction may be issued with regard to the compliance of the same by the petitioner companies. In this regard, it has been submitted that the said observation is based on the contingency. At present, no directions have been issued by the concerned authorities against any of these companies. In this regard, it has been submitted that the said observation is based on the contingency. At present, no directions have been issued by the concerned authorities against any of these companies. It is hereby clarified that the present scheme does not envisage any absolution from any of its legal liabilities and compliances. Additionally, the petitioner companies hereby undertake to comply with the applicable provisions of the Act and provide the requisite documents and or information as and when demanded. (v) Shri Shaikh, learned counsel appearing for Regional Directorate placed on record communication received by him on 11/3/2014, which is also taken into consideration by this Court. 7. In view of these oral facts and considerations and considering all the observations of the Regional Director and having been satisfied with the respective explanations provided on behalf of the petitioner companies, in my view, the observations of the Regional Director do not survive. 8. Heard Smt. Swati Saurabh Soparkar, learned advocate for the petitioner Companies and Shri Shaikh, learned counsel appearing for the Central Government. Having gone through the petitions, and having considered the submissions made in this regard and being satisfied that amalgamation under the proposed scheme wound be in the interest of the companies and their members and creditors. Prayers in terms of paragraph 15(1) of the Company Petition Nos. 306, 307, 308 and 309 of 2013 are hereby granted. 9. The petitions are disposed of accordingly. So far as the costs to be paid to the Central Government Standing Counsel is concerned, the same are quantified at Rs.7,500/- per petition. The same be paid to the counsel appearing for the Central Government. Cost of Rs.5,000/- be paid to the Office of the Official Liquidator towards cost for the Transferor Companies. 10. The petitioner companies are further directed to lodge a copy of this order, the schedules of immovable assets of all the Transferor Companies as on date of this order and the Scheme duly authenticated by the Registrar, High Court of Gujarat, with the concerned Superintendent of Stamps, for the purpose of adjudication of stamp duty, if any, on the same within 60 days from the date of the order. 11. 11. The petitioner companies are directed to file a copy of this order along with a copy of the Scheme with the concerned Registrar of Companies, electronically, along with E-From 21 in addition to physical copy as per relevant provisions of the Act. 12. Filing and issuance of drawn up order is hereby dispensed with. 13. All concerned authorities to act on a copy of this order along with the Scheme duly authenticated by the Registrar, High Court of Gujarat. The Registrar, High Court of Gujarat shall issue the authenticated copy of this order along with Scheme as expeditiously as possible.