2006 (9) TMI 288 - HC - Companies Law

Summary

Issues involved:
1. Authorization of share capital in the scheme of amalgamation.
2. Modification of main objects of the transferee-company.
3. Compliance with Reserve Bank of India regulations for non-banking financial companies.
4. Typographical error in the appointed date in the prayer clause of the petition.

Detailed Analysis:
1. The first issue raised was regarding the authorized share capital of the transferor-company being added to the existing authorized share capital of the transferee-company in the proposed scheme. The court rejected the objection, stating that the transferee-company can increase its authorized share capital following the prescribed procedure under the Act.

2. The second issue involved the modification of the main objects of the transferee-company to include the business of the transferor-company. The court noted that no amendment was required as per the counsel for the transferee-company. Any necessary amendments would be made following the procedure prescribed under the Act, and the objection was considered infructuous.

3. The third issue raised was the non-banking financial company status of the transferor-company and the requirement to inform the Reserve Bank of India about the proposed scheme of amalgamation. The court overruled this objection after considering the relaxed norms by the Reserve Bank of India, which required notification within one month of the sanction order.

4. The final issue was a typographical error in the appointed date mentioned in the prayer clause of the petition filed by the transferee-company. The court allowed necessary corrections to be made, clarifying that the appointed date in the scheme of amalgamation was 1-4-2005, not 2004 as mentioned in the petition.

The court, after considering all objections and submissions, sanctioned the scheme of amalgamation, declaring it binding on all shareholders and creditors of both companies. The court approved the scheme with effect from the correct appointed date of 1-4-2005. Additionally, the court ordered the transfer of property, rights, powers, liabilities, and duties from the transferor-company to the transferee-company as per the provisions of the Companies Act, 1956. The order also directed the transferor-company to be dissolved without winding up, following the delivery of a certified copy of the order to the Registrar of Companies for registration.