1995 (6) TMI 176 - HC - Companies Law

Summary

Issues Involved:
1. Confirmation of the Scheme of Arrangement between The Assam Company Limited (ACL) and Camelia Estates Limited (CEL).
2. Transfer of property, rights, and powers from ACL to CEL.
3. Transfer of debts, liabilities, duties, and obligations from ACL to CEL.
4. Continuation of legal proceedings by or against ACL in respect of the Property Division.
5. Filing of the Schedule of Assets of ACL.
6. Delivery of a certified copy of the order to the Registrar of Companies.
7. Liberty to apply for further directions.

Issue-wise Detailed Analysis:

1. Confirmation of the Scheme of Arrangement:
The court examined the petition for the confirmation of the Scheme of Arrangement between ACL and CEL, which was verified by affidavit and submitted under rule 78 of the Companies (Courts) Rules, 1959. The Scheme of Arrangement was advertised as ordered by the court, and no objections were raised by the Regional Director, Company Law Board, Eastern Region. The court found the Scheme to be bona fide and approved it, declaring it binding on ACL, their shareholders, and all concerned from the Effective Date of December 1, 1994.

2. Transfer of Property, Rights, and Powers:
The court ordered that all property, rights, and powers of ACL related to the Property Division, as specified in Schedule "B," be transferred to CEL without further act or deed, effective from the said Effective Date. This transfer was pursuant to section 394(2) of the Companies Act, 1956, and included all estates and interests of ACL therein, subject to existing charges.

3. Transfer of Debts, Liabilities, Duties, and Obligations:
All debts, liabilities, duties, and obligations of ACL related to the Property Division were ordered to be transferred to CEL from the Effective Date, without further act or deed. Consequently, these would become the debts, liabilities, duties, and obligations of CEL, as per section 394(2) of the Companies Act, 1956.

4. Continuation of Legal Proceedings:
The court ordered that all pending proceedings, suits, and appeals by or against ACL in respect of the Property Division be continued by or against CEL. This ensures that CEL assumes all ongoing legal responsibilities related to the Property Division.

5. Filing of the Schedule of Assets:
The court granted leave to the petitioner-companies to file the Schedule of Assets of ACL within three weeks from the date of the order. This schedule is critical for the accurate transfer of assets to CEL.

6. Delivery of Certified Copy of the Order:
ACL and CEL were directed to deliver a certified copy of the court's order to the Registrar of Companies within 30 days for registration. This step is necessary to formalize the transfer and arrangement legally.

7. Liberty to Apply for Further Directions:
The court allowed any interested person the liberty to apply for further directions in the matter if necessary. This provision ensures that any future issues or clarifications needed can be addressed by the court.

Conclusion:
The court sanctioned the Scheme of Arrangement between ACL and CEL, ensuring the transfer of property, rights, and liabilities from ACL to CEL, continuation of legal proceedings by or against CEL, and compliance with necessary legal formalities, thus facilitating a smooth transition and enabling both companies to focus on their respective business areas more effectively.