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Rajasthan High Court · body

2016 DIGILAW 1742 (RAJ)

In Re: Fine Mining (Granite) Private Limited v. .

2016-12-02

ALOK SHARMA

body2016
ORDER : Alok Sharma, J. 1. Instant Company petition has jointly been filed by the petitioner companies under Sections 391-394 of the Companies Act, 1956 (hereinafter 'the Act of 1956') seeking sanction of the scheme of amalgamation so as to binding on all the petitioner transferor companies and the transferee company and their respective shareholders and creditors. 2. Counsel submits that the transferor company No. 1 (Fine Mining (Granite) Private Limited) having its registered office at Makrana Road, Madanganj Kishangarh, Rajasthan was incorporated on 15-11-1996 under the Act of 1956. It has authorised share capital of Rs. 1,00,000/-divided into 10,000 equity shares of Rs. 10/- only. The issued, subscribed and paid up share capital is Rs. 1,00,000/- divided into 10,000 equity shares of Rs. 10/- each. The copy of the audited balance sheet as on 31-3-2016 has been annexed as Annexure-1. 3. The transferor company No. 2 (Ridhi Sidhi Chem Private Limited) having its registered office at Makrana Road, Madanganj Kishangarh Rajasthan was incorporated on 30-4-1996 under the Act of 1956. It has authorised share capital of Rs. 10,00,000/- divided into 1,00,000 equity shares of Rs. 10/- only. The issued, subscribed and paid up share capital is Rs. 1,00,000/- divided into 10,000 equity shares of Rs. 10/- each. The copy of the audited balance sheet as on 31-3-2016 has been annexed as Annexure-3. 4. The transferee company (Property Ventures (India) Private Limited) having its registered office within the Jurisdiction of Registrar of Companies Maharashtra at Mumbai was incorporated on 19-6-2000 under the Act of 1956. Subsequently the registered office was changed at Makrana Road, Madanganj Kishangarh, Rajasthan with the approval of the Company Law Board (CLB) Western Region vide order dated 21-12-2010 and a fresh certificate of registration was issued on 21-2-2011 by the Registrar of Companies, Rajasthan at Jaipur. It has authorised share capital of Rs. 25,00,00,000/- divided into 2,50,00,000 equity shares of Rs. 10/-only. The issued, subscribed and paid up share capital is Rs. 23,00,00,000/-divided into 2,30,00,000 equity shares of Rs. 10/- each. Copy of the audited balance sheet as on 31-3-2016 has been annexed as Annexure-5. 5. The Board of Directors of the Transferor Companies have approved the Scheme of Amalgamation in their meeting held on 1-6-2016. Copies of the same are enclosed with the petition as Annexure-2 and 4. 23,00,00,000/-divided into 2,30,00,000 equity shares of Rs. 10/- each. Copy of the audited balance sheet as on 31-3-2016 has been annexed as Annexure-5. 5. The Board of Directors of the Transferor Companies have approved the Scheme of Amalgamation in their meeting held on 1-6-2016. Copies of the same are enclosed with the petition as Annexure-2 and 4. The Board of Directors of the Transferee company has approved the Scheme of Amalgamation in their meeting held on 1-6-2016. Copy of the resolution has annexed with the petition as Annexure-6. 6. Meetings of shareholders and creditors of the petitioner companies were dispensed with vide order dated 8-7-2016 in SB Company Application No. 120/2016, with liberty to move for second motion seeking sanction/approval of the scheme of amalgamation after due process. 7. Hence this petition for second motion seeking approval of the scheme of amalgamation under consideration. 8. Notice were issued by this court on 26-8-2016 to the Regional Director, North Western Region, Ministry of Corporate Affairs Ahmedabad and the Official Liquidator attached to this court with further direction to publish the same in Rajasthan Patrika, Ajmer Edition and Financial Express Delhi Edition. This was so done on 17-9-2016, copies of which have been placed on record. Despite that none has appeared to object the scheme. 9. On an application being filed, the amended scheme of amalgamation rectifying the typographical error in the scheme was allowed on 21-10-2016 and the amended scheme of amalgamation was taken on record. 10. An affidavit of the Regional Director has been filed on 17-10-2016, nothing substantial has been stated in the affidavit, but specific comments were sought from the Income Tax Department about the proposed scheme but no reply has been received from the Income Tax Department. It was also prayed for direction to petitioner companies for complying with Accounting Standard-14. 11. Counsel for the petitioner companies submits that the transferor companies shall comply with the applicable provisions of the Income Tax Act, 1961 as also the Accounting Standard-14. An affidavit to that effect has also been filed. 12. It was also prayed for direction to petitioner companies for complying with Accounting Standard-14. 11. Counsel for the petitioner companies submits that the transferor companies shall comply with the applicable provisions of the Income Tax Act, 1961 as also the Accounting Standard-14. An affidavit to that effect has also been filed. 12. The Official Liquidator attached to this court has also filed his report on 27-10-2016, wherein also it has been concluded that the affairs of the transferor companies have not been conducted in a manner prejudicial in the interest of its members, creditors and public at large and the Official Liquidator has no objection against the sanctioning of the scheme. 13. Heard and considered the submissions made by the counsel for the petitioners, Regional Director as well as the Official Liquidator and examined the material available on record. 14. The scope of the Company Court sitting over an application for sanctioning of amalgamation on an application under Sections 391 and 394 of the Act of 1956 is supervisory in nature and limited to ensure that in the process there is no violation of any statutory rule or prejudice to public interest. From the affidavit submitted by the Regional Director and the report of the Official Liquidator, on notice being sent to them on second motion under Sections 391 and 394 of the Act of 1956, it is quite apparent that no ground for denying the scheme of amalgamation is made out in the present case. The issue of Income Tax Clearance, to my mind, is a matter which does not directly flow from the language of Section 391 of the Act of 1956. Income Tax liability is a matter distinct from manner of carrying out of business. Income tax liability would hold as per law both for the period prior to the sanction of the scheme and thereafter. Even otherwise under the circular dated 15-1-2014, non response to the Regional Director's letter is required to be considered as a presumption that the Income Tax Department has no objection to the action of the merger/demerger as the case may be under Sections 391-394 of the act of 1956. 15. Having examined the scheme of amalgamation, this court find nothing prejudicial to the interest of creditors, members of both transferor companies and the transferee company or to public interest. All required procedures had been followed. 16. 15. Having examined the scheme of amalgamation, this court find nothing prejudicial to the interest of creditors, members of both transferor companies and the transferee company or to public interest. All required procedures had been followed. 16. Consequently, the company petition is allowed. This court does hereby sanction the amended scheme of amalgamation and does hereby declare the same to be binding on creditors and equity shareholders of transferor companies and the transferee company. 17. The parties to the amalgamation or other persons interested shall be at liberty to apply to this court for any directions that may be necessary in regard to the working of the amalgamation. 18. The order in prescribed Form No. 42 be issued separately by the Registrar as per Rule 84 of the Companies (Court) Rules, 1959. 19. The said companies may file with the Registrar of Companies a certified copy of this order within fourteen days. The Official Liquidator shall be entitled to Rs. 50,000/- in aggregate from the two transferor companies towards miscellaneous expenses. Further an amount of Rs. 20,000/- be paid as costs for OL's counsel Mr. Gaurav Sharma. 20. The company petition stands allowed accordingly.