9911796707
|
Home
Issues Involved:
1. Sanctioning of the Scheme of Arrangement and Amalgamation u/s 391 and 394 of the Companies Act, 1956. 2. Necessity of approval from the transferee-company. 3. Effective date of the scheme. 4. Directions u/s 394 of the Companies Act, 1956. Summary: 1. Sanctioning of the Scheme of Arrangement and Amalgamation u/s 391 and 394 of the Companies Act, 1956: In this petition u/s 391 and 394 of the Companies Act, 1956, the petitioner-company sought approval for a proposed scheme of arrangement and amalgamation with M/s. Choudhari Metal Industries Private Ltd. The court had initially sanctioned the compromise on 19th April 1976 but deferred further orders u/s 394 pending additional information. The Registry identified defects in the scheme, including an unclear transfer date and jurisdictional issues since the transferee-company was based in West Bengal. The court aimed to pass a comprehensive order addressing both sections 391 and 394. 2. Necessity of approval from the transferee-company: The court examined whether the scheme required sanction from the transferee-company, M/s. Choudhari Metal Industries (P.) Ltd. The petitioner-company's shareholders had unanimously approved the scheme. The court referred to precedents, including Bank of India Ltd. v. Ahmedabad Manufacturing & Calico Printing Co. Ltd., and concluded that since the petitioner was a wholly-owned subsidiary of the transferee-company, the latter's approval was not necessary. The scheme did not affect the transferee-company's creditors or members, thus not requiring their approval u/s 391. However, the court noted that if the scheme impacted the transferee-company's rights, approval would be necessary. 3. Effective date of the scheme: The court addressed the effective date of the scheme, initially set as 30th April 1974. Given the approval in 1976, the court deemed it impractical to backdate the scheme by almost two years. The effective date for accountancy purposes was set as 30th June 1975, with the actual transfer of property to follow the formal order u/s 394. 4. Directions u/s 394 of the Companies Act, 1956: The official liquidator's report indicated no public interest concerns, and the petitioner-company's directors were also members of the transferee-company. The court found no impediment to the dissolution of the petitioner-company, complying with the second proviso to section 394(1). The court ordered the transfer of all assets, liabilities, and legal proceedings to the transferee-company, with the petitioner-company to be dissolved without winding up. The court modified the scheme by omitting redundant paragraphs and adjusting the effective date. A formal order combining Forms No. 41 and 42 would be drawn up, specifying the property to be transferred and the procedural requirements for filing with the Registrar of Companies.
|
