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TMI Blog2014 (1) TMI 1818X X X X Extracts X X X X X X X X Extracts X X X X ..... ure U and Annexure R to their respective Company Petitions viz. Company Petition No. 270 of 2013 and Company Petition No. 271 of 2013 respectively. It has been contended that the Resulting Company is wholly owned subsidiary of the Demerged Company. The Petitioners have given in detail the background, circumstances, rationale and significant benefits envisaged due to the Scheme, in their respective Petitions. 3. It is submitted on behalf of the Petitioner Companies that the Scheme inter alia provides for transfer by way of a Demerger of the Demerged Undertaking (defined in the Scheme) of the Demerged Company to the Resulting Company pursuant to Sections 391 to 394 of the Companies Act, 1956 and for reduction of capital of the Petitioner Companies under Sections 78, 100 to 104 and other relevant provisions of the Companies Act, 1956, as set out in the Scheme. 4. It has been submitted that the Demerged Company, the Petitioner Company in Company Petition No. 270 of 2013 is primarily engaged in the business of manufacturing line pipes used to transport oil, gas, water and other liquid and gaseous consumables and plates and coils required for manufacturing line pipes (the " Line Pipes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion. Similarly, Clause 51 of the Scheme postulates reduction of share capital of the Resulting Company as post allotment of shares by the Resulting Company in terms of clause 35 of the Scheme, the existing share holding of the Demerged Company in the Resulting Company shall be cancelled in accordance with provisions of Section 100 to 103 of the Companies Act, 1956 are the order of this Court sanction the Scheme shall be deemed to be the order under Section 102 of the Companies Act, 1956 for the purposes of the confirming the reduction. 8. Accordingly both the Petitioner Companies in their respective Extra Ordinary General Meetings, both held on 22nd October, 2013 passed a special resolution and approved their respective reduction in the capital of the respective Petitioner Companies. 9. The Petitioner Companies thereafter filed their respective Company Petitions in this Court seeking sanction to the Scheme. By the separate orders, both dated 18th November, 2013, this Court admitted both the Petitions and kept for hearing on 20th December, 2013 and directed the Petitioner Companies to give notice of hearing of the Petition to the Central Government through the Regional Director, N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e been dealt with, in detail in paragraph 2. I have further heard submissions made by the learned Senior Advocate Mr. Saurabh Soparkar, appearing for the Petitioner Company, as briefly set out hereunder; (a) With regard to the submission of the working sheets as calculation of the share exchange ratio in the valuation report is concerned, it is submitted that, an independent valuer was appointed for the valuation, and such independent valuer has arrived at the share exchange ratio based on their expertise and experience. It is further submitted that the valuer has, as is relevant, given the context that all the shareholders of the Demerged Company shall receive proportionate shareholding in the Resulting Company, based on his findings and given his recommendation on the basis of the book value of the assets and on the basis of the share capitals of the Demerged Company and the intended share capital of the Resulting Company. The share exchange ratio that has been arrived at by the valuer has been approved by more than the requisite majority of the shareholders and creditors of the Demerged Company in the court convened meeting held on 22nd October, 2013 without any questions rais ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deration for the stakeholders and hence has not been objected to by any of the stakeholders. Mr. Soparkar relied on the decision of Edelweiss Stock Broking Limited, Company Petition No. 180 of 2011 and submitted that, the Ld. Company Judge of this Hon'ble Court vide order dated 30.03.2012, overruled the objection of the R.D to fixation of 01.04.08 as Appointed Date and sanctioned the scheme as originally proposed. Mr. Soparkar further relied on the decision of the Division Bench of this Hon'ble Court in O.J. Appeal 65 of 2009 whereby, the Division Bench modified the Appointed Date as granted by the Ld. Company Judge. (g) With regard to the use of suffix 'and reduced' in case of De-merged company, it was submitted that, there is no need for the Demerged Company and the Resulting Company to add the word "and reduced", as observed by the Regional Director. 14. Considering all the facts and circumstances and taking into account all the contentions raised in the Affidavits and Reply Affidavits and the reliance placed on the judgments of the Apex Court and this High Court and the submissions made during the course of hearing, I am satisfied that the observations made by the Regional D ..... X X X X Extracts X X X X X X X X Extracts X X X X
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