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TMI Blog2010 (8) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... iation is enclosed as annexure 1 to the said petition. 4. In the meeting held on February 12, 2010, the board of directors of the transferor company, the petitioner in C. P. No. 85 of 2010, considered and approved the scheme of amalgamation of the transferor company with the transferee company, the petitioner in C. P. No. 86 of 2010. Copy of the board resolution is enclosed as annexure 4. The scheme of amalgamation is enclosed as annexure 5. 5. As regards the transferee company, in the meeting held on February 12, 2010, the board of directors of the petitioner in C. P. No. 86 of 2010, considered and approved the scheme of amalgamation of the transferee company with the transferor company, the petitioner in C. P. No. 85 of 2010. Copy of the board resolution is enclosed as annexure 3. The scheme of amalgamation is enclosed as annexure 4. 6. As far as the transferor company is concerned, as per the auditor certificate, the transferor company has no secured creditors and the copy of the auditor certificate is enclosed as annexure 8. In so far as the transferee company, the petitioner in C.P. No. 86 of 2010 is concerned, there are two secured creditors as per annexure 7 and they have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1956, as provided under sections 391 and 394, even in the absence of any enabling provision in the memorandum of association enabling the company to enter into amalgamation or arrangement, there is no impediment for the court to approve such scheme. 12. A reference to the said sections 391 and 394 of the Companies Act, 1956, which facilitate the reconstruction and amalgamation of the companies by order of court, shows clearly that such transfer or amalgamation is a right conferred under law and the memorandum of association of every company also impliedly incorporates the terms of the Companies Act. Under such circumstances, I am of the considered view that even in the absence of any enabling provision under the memorandum of association enabling the company to formulate a scheme for the purpose of amalgamation, the court can consider such scheme, provided such proposal or scheme is not detrimental to the interest of the transferor or transferee company. On the facts of the present case, as elicited above, the transferor company in fact is having such enabling provision under the memorandum of association, while the same is not available in memorandum of association of the tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y be made to the judgment and decision in PMP Auto Industries Ltd., In re reported in [1994] 80 Comp. Cas. 289 (Bom). It was held in this decision that the power to amalgamate is a statutory power given to a company expressly under the provisions of section 391 of the Companies Act and hence this objection cannot be sustained. The contention of the Central Government that inasmuch as the memorandum of association of some of the petitioners does not contain express power to amalgamate with another company, the petition is not maintainable cannot be accepted. In this connection the judgment and decision of the Division Bench of this court in Hari Krishna Lohia v. Hoolungooree Tea Co. Ltd. AIR 1969 Cal 312, 314 ; Manu/WB/0055/1969 ; [1970] 40 Comp. Cas. 458 , may be taken note of. In the aforesaid decision the Division Bench held that the power to amalgamate is a statutory power and this power may be exercised notwithstanding the fact that the memorandum of association of a particular company may not contain express power to amalgamate with another company. Accordingly, the contention of the learned advocate of the Central Government on this point fails. The other contention of the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by resorting to the statute which confers a right on a company to alter its memorandum in aid of amalgamation with another company. If a company by virtue of its power in the memorandum desires to amalgamate with another company without coming to a court of law, such, amalgamation would be valid'. A single judge of the Calcutta High Court has adopted this view in United Bank of India Ltd. v. United India Credit and Development Co. Ltd. [1977] 47 Comp. Cas. 689 and in Marybong and Kyel Tea Estate Ltd., In re [1977] 47 Comp. Cas. 802 (Cal). The learned judge had based his conclusion on the principle that by invoking sections 391 and 393 of the Companies Act, the statutory powers exercised by the company judge had been invoked, and that consequently , there are no fetters on the exercise of such powers regardless of whether the power to amalgamate with another company is contained in the memorandum of the concerned company. This view has also found favour with the High Court of Bombay in Aimco Pesticides Ltd., In re [2001] 103 Comp. Cas. 463 .1 am in respectful agreement with the views expressed, by both the High Courts. It appears to me to be un-conrrovertable that the powers of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in Saboo Leasing (P.) Ltd., In re [2003] 117 Comp. Cas. 728, while considering an objection of the Regional Director to the effect that the authorised share capital of the merged company was being increased as a result of the scheme of amalgamation and this could only be carried out after following the procedure prescribed by the relevant provisions of the Companies Act and held that in the case of such merger no such payment of fee to the Registrar of Companies or stamp duty to the State Government shall be payable." 22. Moreover, a perusal of the scheme shows that it contains no objectionable feature detrimental to the interest of the employees of the transferor company or of the transferee company. The said scheme is not violative of any statutory provisions. The scheme is fair, just, sound and is not against any public policy or public interest. No proceedings are pending under sections 231 to 237 of the Companies Act, 1956. All the statutory provisions are complied with. 23. Consequently, there shall be an order approving the scheme of amalgamation of the transferor company, Laurel Aromatics (P.) Ltd., with the transferee company, Contract Point Impex (India) (P.) Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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