9911796707
TMI Blog2004 (8) TMI 413X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings were pending, the respondent No. 2 herein filed an application before the Company Law Board (hereinafter called as the Board ) for substitution of TCFC Finance Limited in place of 20th Century Finance Corporation Limited. On the other hand, the appellant herein filed another application for dismissal of the petition. 2. The reason which led to the filing of the substitution application was sanctioning of the scheme of amalgamation by the Bombay High Court between 20th Century Finance Corporation Limited (hereinafter referred to as the transferor-company ) and TCFC Finance Limited (hereinafter referred to as the transferee-company ) and all the assets and liabilities pertaining to investments were also transferred to the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mentioned that all legal proceedings pending by or against the petitioner-company relating to Investments Division shall be continued by or against the transferee-company. The judgment quoted by learned Counsel for the respondents of Hon ble Supreme Court is not applicable in this case as there was no third party tenancy rights in that case. In the instant case, there is no such third party rights/agreement and shares are movable properties are freely transferable by virtue of amalgamation order passed by Hon ble High Court of Bombay. I am also not convinced with the arguments of the learned Counsel for respondents that the transferee-company namely TCFC Finance Ltd. has no complaint against the respondent-company. Although, as such their a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner is directed to file amended memo of parties. In view of above discussions, CA No. 242/99 stands disposed of. CA No. 244/99 which was of similar nature also stands disposed of. There is no order as to cost." 3. The aforesaid conclusion and decision to substitute the transferee- company in place of the transferor-company, arrived at by the Board, is perfectly valid. The effect of amalgamation of one company into other is so obvious that it hardly needs any elaboration. When two companies amalgamate and merge into one, the transferor-company losses its entity and ceases to have its existence. However, their respective rights or liabilities are to determine under the scheme of amalgamation. This principle is clarified by the Ape ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against the petitioner-company relating to its Investment Division shall be continued by or against the transferee-company ." 4. The transferee-company thus stepped into the shoes of the transferor- company and acquired the right to proceed with any such proceedings pending in any Court of law and to enforce the right which could be enforced by the transferor-company. 5. The matter may be looked into from another angle. The allegations of oppression and mismanagement are to be seen as on the date when the petition is filed and maintainability is also to be decided on that basis. This is clear position in law as held in the case of Jagdish Chand Mehra v. New India Embroidery Mills (1946) (P.) Ltd. wherein the Court observed : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion is to be allowed (Refer: State of U.P. v. Jaya Shree Textile Industries Ltd. AIR 1985 All. 212). Otherwise it will lead to anomalies and nullify the very effect of the amalgamation of the rights guaranteed to the transferee-company as a result thereof. 8. It may be significant to note, as noted in the impugned order and not denied by the appellant herein, in CP No. 113/1999 filed before this Court, this Court has allowed the substitution of M/s. Centurian Bank in place of transferor-company and interestingly this application was not opposed by the appellant herein who is also party to the said proceedings. 9. I, therefore, do not find any merit in this appeal which is dismissed accordingly. The application also stands disp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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