2002 (3) TMI 822 - HC - Companies Law

Summary

Issues Involved:
1. Sanction of the scheme of amalgamation under sections 391 to 394 of the Companies Act, 1956.
2. Objections raised by shareholders and other individuals.
3. Compliance with statutory provisions and regulatory approvals.

Issue-wise Detailed Analysis:

1. Sanction of the Scheme of Amalgamation:
The petition was filed by ICICI Bank Limited to obtain the court's sanction for the amalgamation of ICICI Limited, ICICI Capital Services Limited, and ICICI Personal Financial Services Limited (collectively referred to as the "transferor-companies") with ICICI Bank Limited (the transferee-company). The court noted that the amalgamation was proposed due to the benefits of transformation into a universal bank and the existing strong business synergies between ICICI and ICICI Bank. The scheme was approved by the board of directors of the transferor and transferee companies on October 25, 2001, and was subsequently sanctioned by an overwhelming majority of equity shareholders.

2. Objections Raised by Shareholders and Other Individuals:
Several objections were received from shareholders and other individuals, including concerns about the share exchange ratio, dividend income post-merger, and grievances against Bank of Madura Ltd., which had previously merged with ICICI Bank. The court found that most objections were vague and did not raise any specific legal issues. One significant objection was from Mr. Rajiv Agarwal, who had filed a criminal complaint regarding dishonored cheques. However, the court noted that the criminal proceedings were stayed by the Rajasthan High Court. Another objector, Mr. S.V. Parekh, had grievances against Bank of Madura Ltd., but the court held that these grievances could be addressed by the Consumer Forum and did not relate to the amalgamation.

3. Compliance with Statutory Provisions and Regulatory Approvals:
The court referred to the principles laid down by the Apex Court in Miheer H. Mafatlal v. Mafatlal Industries Ltd., emphasizing the scope and ambit of the jurisdiction of the company court under sections 391 to 394 of the Companies Act. The court ensured that all requisite statutory procedures were complied with, including holding the requisite meetings and obtaining the necessary majority vote. The Central Government's observations were addressed by the scheme itself, which provided for amendments to the memorandum and articles of association of the transferee-company. The court also noted that the scheme's sanction was conditional upon the Reserve Bank of India granting the requisite statutory approvals.

Conclusion:
The court sanctioned the scheme of amalgamation of ICICI Limited, ICICI Capital Services Limited, and ICICI Personal Financial Services Limited with ICICI Bank Limited. The court directed the petitioner-company to pay the fees of the learned additional standing counsel for the Central Government and disposed of the petition and the related civil application. The sanction was subject to approval by the Reserve Bank of India and the Bombay High Court in respect of the transferor-companies.