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TMI Blog2004 (4) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... Transferor Company with the Transferee Company. Copy of the proposed Scheme of Amalgamation has been filed as Annexure 4 to the company application. 4. It is, inter alia, stated in the company application that the Transferor Company was incorporated in Kolkata in the State of West Bengal on 9-7-1999 under the Companies Act, 1956 as a Private Limited Company; and that thereafter, the registered office of the Transferor Company was shifted from the State of West Bengal to the State of Uttar Pradesh; and that the change was duly conformed by the Company Law Board, E.R. Bench, Kolkata on 25-7-2003 in C.P. No. 243(17) ERB/2003, and the same was duly filed with the Registrar of Companies, U.P. and Uttaranchal at Kanpur, pursuant to the provisions of section 18(3) of the Act. 5. It is, inter alia, further stated in the company application that the Transferee Company was originally incorporated on 21-8-1962 under the Companies Act, 1956 under the name Narendra Explosives Limited, which was subsequently changed as Bharat Explosives Limited, by duly passing the special resolution on 30-9-1986 in terms of section 21 of the Companies Act, 1956 and obtaining the necessary fresh ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Transferee Company are stated in brief in paragraph 8 of the company application. 10. It is, inter alia , further stated in the company application that the authorised capital of the Transferee Company is Rs. 20,00,00,000 (Rupees twenty Crores only) divided into 1,80,00,000 equity shares of Rs. 10 (Rupees Ten only) each, and 2,00,000 cumulative preference shares of Rs. 100 each; and that the issued, subscribed, called and paid up capital of the Transferee Company, as on 31-3-2003 is Rs. 1,171.50 lakhs divided into 1, 17,15,000 equity shares of Rs. 10 each fully paid up. 11. It is, inter alia, further stated in the company application that the company application has been filed seeking sanction of this court in respect of the proposed Scheme of Amalgamation for the amalgamation of the Transferor Company with the Transferee Company. Copy of the proposed Scheme of Amalgamation, as mentioned above, has been filed as Annexure 4 to the company application. 12. The objects sought to be achieved by the proposed merger/amalgamation have been stated in brief in paragraph 13 of the company application. 13. It is, inter alia, further stated in the company application t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er alia, further stated in the company application that in terms of Cl. 3.1 of the Scheme of Amalgamation, the investment of the Transferee Company in the fully paid equity shares of the Transferor Company shall on the date of the scheme becoming effective stand cancelled and extinguished against the share capital of the Transferor Company; and that consequently, there will be no increase in the share capital of the amalgamated company; and that as the proposed Scheme of Amalgamation does not envisage a further allotment of fresh shares, no share valuation report is necessary. 20. The financial position of the Transferor Company as on 31-3-2003 has been stated in brief in paragraph 21 of the company application. Copy of the audited balance sheet and profit and loss account of the Transferor Company for the financial year ending 31-3-2003 has been filed as Annexure 8 to the company application. 21 . The financial position of the Transferee Company as on 31-3-2003 has been stated in brief in paragraph 22 of the company application. Copy of the audited balance sheet and profit and loss account of the Transferee Company for the financial year ending 31-3-2003 has been filed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vil Misc. Application No. 49465 of 2004. It is, inter alia, prayed in paragraph 30 of the company application that in light of the above facts, the convening of the meeting of the shareholders of the Transferee Company be dispensed with. 28. It is, inter alia, further stated in paragraph 31 of the company application that various small individuals have made deposits with the Transferee Company amounting to Rs. 246.73 lakhs; and that the interest of the said deposit holders shall not be affected by any provision of the proposed Scheme of amalgamation. 29. It is, inter alia , further stated in paragraph 32 of the Company Application that certain corporate entities have also made deposits (inter-corporate deposits) with the Transferee Company, and the corporate depositors valued at Rs. 151.64 lakhs have given their consent to the proposed Scheme of Amalgamation. Copies of the Consent Letters given by 10 such corporate depositors have been filed as part of Annexure-12 to the company application at pages 248, 249, 251, 253, 254, 255, 256, 257, 258 and 259, respectively of the Paper Book. 30. It may be mentioned that the said Letters of Consent, in original, have also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perty, movable and immovable properties allotted by Government agencies whether by ownership lease or otherwise, fittings and fixtures, telephones, telex and fax connections, cash balances, reserves, security deposits, refunds, goodwill, outstanding balances, stocks, investments, leases, licences, contracts, approvals, authorizations, agreements and other rights and interests of all description in or arising out of such properties as may belong to or be in possession of BEL and all books of account and documents and records relating thereto, all of which is hereafter called (the said Undertakings ) shall without further act or deed, be transferred to and vest in BEL pursuant to sections 391 and 394(2) of the Act, with effect from the Appointed Day, so as to become the assets and properties and authorization, permission and licence of BEL, but subject to voluntary and statutory charges if applicable or due, affecting the same. Provided always that any reference in any security document/arrangement to which BEPL is a party, to any assets of BEPL offered as security for any financial obligation or assistance, shall be construed as a reference to only the assets or authorization or li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions made by Shri Yashvant Verma, learned counsel for the Transferee Company/Applicant. 40. A perusal of the Letters of Consent given by the aforesaid four secured creditors shows that each of the four secured creditors has given its consent to the proposed Scheme of Amalgamation subject to certain conditions mentioned in the said Letters of Consent. Copies of the said Letters of Consent, as noted above, have been filed as part of Annexure-10 to the Company Application at pages 189, 190, 192 and 194 of the Paper Book. 41 . Besides the aforesaid Letters of Consent, each of the secured creditors has also submitted an affidavit, inter alia, stating that it has, in principle, no objection in the event of amalgamation of the Transferor Company with the Transferee Company pursuant to the draft Scheme of Amalgamation, subject to the condition that the charge in favour of such secured creditor is continued with the company, which is to be created upon amalgamation; and that it (secured creditor) shall have no objection if the meeting of the secured creditors is waived by this Court. Copies of the said affidavits, as noted above, have been filed as part of Annexure-10 to the Compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Transferee Company/Applicant, express provision(s), as mentioned above, will be incorporated in the proposed Scheme of Amalgamation, and further, affidavit(s) making averments, mentioned above, will also be filed. 47 . In view of the aforementioned facts and circumstances, particularly in view of the fact that all the four secured creditors have given their no objection to the proposed Scheme of Amalgamation and to dispensing with the requirement of holding meeting of the secured creditors of the Transferee Company, and also in view of the directions given above regarding incorporation of express provision(s) in the proposed Scheme of Amalgamation and regarding filing of the affidavit(s) while filing the Petition for confirmation of the proposed Scheme of Amalgamation, I am of the opinion that it is not necessary to call meeting of the secured creditors of the Transferee Company for consideration of the proposed Scheme of Amalgamation, as per the requirements of section 391(1) and (2) read with section 393 of the Companies Act, 1956. In the circumstances, the requirement for holding the meeting of the secured creditors of the Transferee Company for consideration of the propo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e shareholding in the Transferee Company have not given their consent to the proposed Scheme of Amalgamation or to waiver of the meeting of the shareholders of the Transferee Company. 55 . I am of the opinion that in order to safeguard the interest of the said three minority groups of shareholders, namely, other bodies corporate, Indian Public, and NRIs/OCBs, it is necessary to convene the meeting of the shareholders/members of the Transferee Company for consideration of the proposed Scheme of Amalgamation as per the requirements of section 391(1) and (2) read with section 393 of the Companies Act, 1956. 56 . As regards convening of meeting of the unsecured creditors of the Transferee Company, Shri Verma submits that various small individuals have made deposits with the Transferee Company amounting to Rs. 246.73 lakhs. The interest of these deposit holders, it is submitted, will not be affected by any provision of the proposed Scheme of Amalgamation. 57 . Shri Verma further submits that besides the aforesaid deposits made by various small individuals, certain corporate entities have also made deposits (inter-corporate deposits) with the Transferee Company, and the Corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve made deposits with the Transferee Company. The said list shows that the following 14 corporate entities have made deposits with the Transferee Company amounting to Rs. 1,72,01,669 ( i.e ., Rs. 172.02 lakhs approximately): (1)Anurag TR, Lease Inv. (P) Ltd. (2)Archana TR. Inv. Co. (P) Ltd. (3)Dear Investment Pvt. Ltd.-ICD (4)Excellent Comm. Ent. Inv. Ltd. (5)General Expo. Credit Ltd.-ICD (6)Harvatex Engg. Proce. Co. Ltd. (7)Ilac Investment P. Ltd. (ICD 2) (8)Lohanak Enternational P. Ltd.-ICD (9)Light weight Aggregate Pvt. Ltd. (10)Pashupatinath Comm. (P) Ltd.-ICD (11)Sachin Holdings Pvt. Ltd. (12)Sanjay TR. Inv. Co. (P) Ltd. (13)Swastik Comm. Pvt. Ltd.-ICD (14)Trishul Commercial Pvt. Ltd.-ICD. 66. It is further evident from a perusal of the averments made in Paragraph 32 of the Company Application and the copies of the Consent Letters Annexed as part of Annexure-12 to the Company Application, that out of the above 14 corporate depositors, 10 such corporate depositors have given their Consent Letters copies whereof have been filed as part of Annexure-12 to the Company Application. The said 10 corporate depositors, as per the averments mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Yashvant Verma, Advocate, for the applicant, and upon reading the application, Exhibits thereto, and the affidavit in support thereof (Exhibit/Annexure-4 being a copy of the proposed Scheme of Amalgamation). IT IS ORDERED That for the purpose of considering, and if thought fit, for approving, with or without modification, the proposed scheme of Amalgamation, it is necessary to have separate meetings of the shareholders/members and the unsecured creditors of the Transferee Company. That meeting of the shareholders/members of the Transferee Company will be convened and held at 9 K.M., Lalitpur Jhansi Road, Lalitpur-284403 on 15th day of May, 2004 (Saturday) at 11.00 O clock in the forenoon for the purpose of considering, and if thought fit, approving, with or without modifications, the proposed Scheme of Amalgamation. That meeting of the unsecured creditors of the Transferee Company will be convened and held at 9 K.M., Lalitpur Jhansi Road, Lalitpur-284403 on 15th day of May, 2004 (Saturday) at 3.00 O clock in the afternoon for the purpose of considering, and if thought fit, approving, with or without modifications, the proposed Scheme of Amalgamation. That at least 2 ..... 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