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TMI Blog2007 (11) TMI 412X X X X Extracts X X X X X X X X Extracts X X X X ..... section 391 of the Act is to reconstitute the Company without the Company being required to make a number of Applications under the Companies Act for various alterations which may be required in its memorandum and articles of association for functioning as a reconstituted Company under the scheme. Not only is section 391 of the Act is a complete code in itself, but it is intended to be in the nature of a "single window clearance". Appeal dismissed. - O.S.A. NO. 354 OF 2007 AND M.P. NO. 5 OF 2007 - - - Dated:- 28-11-2007 - A.P. SHAH AND V. RAMASUBRAMANIAN, JJ. S. Udayakumar for the Appellant. K. Ramasamy for the Respondent. JUDGMENT A.P. Shah, CJ. - Admit. Learned counsel appearing for the respondent waives service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tration fees. He contended that there is nothing in sections 391 to 394 of the Act, which carves put an exception to the compliance of section 97 of the said Act. In support of this contention, he placed reliance on the decision rendered by a learned Single Judge of the Bombay High Court in Anmol Trading Co. Ltd. v. Shaily Engg. Plastics Ltd. [2003] 113 Comp. Cas. 107 as well as a decision of the learned Single Judge of the Calcutta High Court in Areva T and D India Ltd., In re [2007] 138 Comp. Cas. 834 1 . 5. In reply, Mr. K. Ramasamy, learned Counsel appearing for the respon-dent, submitted that with regard to increase of Authorized Share Capital by merger of the authorized capitals of the two Companies, an order can be passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ete code, which provided for the sanctioning of a scheme of compromise and arrangement. Rule 85 of the Companies (Court) Rules, 1959 specifically prescribes the procedure required to be followed where a proposed compromise involved a reduction of capital. Save and except for a situation envisaged in rule 85, section 391 was constituted as a separate and completed code in itself. The Court observed: ". . . If section 391 was subject to other provisions of the Act, every time the scheme of compromise and arrangement is put forth for the sanction of the Court, if it includes things for which specific provisions are made and that will have to be gone through before the scheme is sanctioned, it would result in unnecessary duplication of proced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dge summarized the posi-tion as follows : ". . . . Section 391 invests the Court with powers to approve or sanction a scheme of amalgamation/arrangement which is for the benefit of the company. In doing so, if there are any other things which, for effectuation, require a special procedure to be followed - except reduction of capital - then the Court has powers to sanction them while sanctioning the scheme itself. It would not be necessary for the company to resort to other provisions of the Companies Act or to follow other procedures prescribed for bringing about the changes requisite for effectively implementing the scheme, which is sanctioned by the Court. Not only is section 391 a complete code as held by the Courts, but, in my view, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court is required to be filed before the Registrar for the purpose of its registration, there is no reason as to why it shall not be treated as notice to the Registrar as envisaged under sections 95 to 97 of the Companies Act. Inasmuch as, as discussed hereinabove, the object being the same, the necessary changes that are required to be made in the concerned register by the Registrar of Companies can be effected after receiving the certified copy of the order of this Court sanctioning the scheme. The sanction of the scheme by this Court has its own effect. It is not a mere act of the parties individually and volitionally. The scheme upon being sanctioned by this Court, it becomes operational by virtue of the orders passed by this Court. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shaily Engineering Plastics Limited ( supra ) relied upon by the appellants was found to be inconsistent with the various decisions rendered by Bombay High Court and subsequently followed in other decisions. In fact, the decisions in Vasant Investment Corporation Limited ( supra ) and PMP Auto Industries ( supra ) were not brought to the notice of the learned Single Judge. The view expressed by the learned Single Judge in Anmol Trading Co. Ltd. s case was expressly disapproved in a later judgment of the Bombay High Court in YOU Telecon India (P.) Ltd., In re [2007] 77 SCL 161 (Bom.). The judgments of this Court in Cavin Plastics Chemicals Ltd. v. Cavinkare (P.) Ltd. ( supra ), Aswin Poultry Farms (India) Ltd., In re ( supr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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