9911796707
TMI Blog1997 (4) TMI 457X X X X Extracts X X X X X X X X Extracts X X X X ..... heir registered office at Bhavnagar within the State of Gujarat. The petitioner happens to be the transferee-company and shall be referred to as such, in the present orders. Company Petition No. 107 of 1996, has been presented by the petitioner, M/s. H.K. Dave Gas Co. Pvt. Ltd., a company incorporated under the provisions of the Companies Act, 1956, having their registered office at Bhavnagar, within the State of Gujarat. The petitioner-company shall be referred to as the transferor-company, in the orders. The case presented by the transferee-company in Company Petition No. 106 of 1996 is that, the said company was incorporated on December 18, 1968, in the State of Gujarat, under the provisions of the Companies Act, 1956, as a private l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Petition No. 107 of 1996. The transferor-company was incorporated under the provisions of the Companies Act, 1956, on August 1, 1994, as a private limited company having their office at Khargate, Bhavnagar, within the State of Gujarat. The objects of the transferor-company are set out in the memorandum of association annexed to Company Petition No. 107 of 1996, and include : to carry on the business of manufacturers, bottling, refilling, dealers, agents and suppliers of gases, such as LPG, oxygen, hydrogen, nitrogen, agon, acetylene, carbon dioxide, ammonia, butane and sulphur dioxide, etc. The authorised capital of the transferor-company is Rs. 30,00,000 only divided into three lakh equity shares of Rs. 10 each. The issued, subscribed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also provided that, if any suit, appeal or proceedings of whatsoever nature by or against the transferor-company be pending on the effective date, the same shall not abate or be discontinued or in any way be prejudicially affected by reason of transfer of the undertaking, but would be continued, prosecuted and enforced as the case may be, by or against the transferee-company in the same manner and to the same extent. It is provided that the transferee-company shall, on such transfer, take over all the employees of the transferor-company on the same terms and conditions on which they are employed by the transferor-company with the continuity of service. So far as the share exchange ratio is concerned, it has been provided that the transfe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one equity share of Rs. 10 each of the transferor-company. It is said that the chartered accountants have valued the shares of the transferor-company on the basis of the book value as on October 31, 1995. It is also said that the addition of Rs. 30,00,000 as the appreciation in the value of the land value of the goodwill and bright potentials of business of the transferee-company does not seem to be proper regard being had to the date of its incorporation and the possession of the paid-up capital which came to be increased only after March 31, 1995, from Rs. 6.99 lakhs to Rs. 30 lakhs. The whole objection regarding the exchange ratio appears to have been based upon the contention that the valuation report submitted by the valuer does not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cement of commercial production. The transferor-company, therefore, will be transferring the entire project to the transferee-company on amalgamation as a ready-made turnkey project and there will not be any gestation period at all. It is, therefore, said that, on account of these factors, though the transferor-company has yet not started the actual production, its project has a high goodwill value. In view of this, the valuer has valued appreciation in the value of the land and goodwill, etc. to be of Rs. 30,00,000 which is fair and reasonable. It is also said that, both the companies are private limited companies, shares of which belong to and are beneficially owned by the same family and group. All the shareholders of both the companies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. The assets of the company have been valued by a Government-approved valuer. Both the companies are the group companies of one and the same family. When the shareholders in their commercial wisdom have agreed to the abovesaid exchange ratio, no genuine mistake could be pointed out in the valuation made by the chartered accountants. Regard being had to all this, it appears that the objection coming from the Regional Director, in respect of the exchange ratio, cannot be accepted. On the overall appreciation of the scheme of amalgamation, it appears that, it is in the interest of all concerned and it cannot be said to be against the interest of all the shareholders of any of the companies or of the public in general. In view of all this, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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