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Ajmera Realty & Infra India Ltd vs Unknown on 21 March, 2009

Bombay High Court
Ajmera Realty & Infra India Ltd vs Unknown on 21 March, 2009
Bench: S.J. Vazifdar
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          IN THE HIGH COURT OF JUDICATURE AT BOMBAY
             ORDINARY ORIGINAL CIVIL JURISDICTION




                                                                      
                 COMPANY PETITION NO.63 OF 2009
                        CONNECTION WITH
              COMPANY APPLICATION NO.1652 OF 2008




                                              
    Ajmera Realty & Infra India Ltd.               ....Petitioner




                                             
                                   WITH


                 COMPANY PETITION NO.64 OF 2009




                                   
                         CONNECTED WITH
              COMPANY APPLICATION NO.1653 OF 2008
                    
    Ajmera Precoated Steels Ltd.                    ....Petitioner
                   
    Mr.Shyam Mehta with Mr.Rajesh Shah i/b Rajesh Shah                       &
    Co. for the Petitioners.

    Ms.S.V.   Bharucha with Mr.P.     Khosla              i/b      Mr.S.K.
      


    Mohapatra for the Regional Director.
   



                              CORAM :     S.J. VAZIFDAR, J.
                              DATED :     21ST MARCH, 2009.





    ORAL JUDMENT :-



    1.        The   Petitioners seek an order sanctioning                    a





    scheme   of arrangement entered into between them.                    The

scheme involves the demerger of the steel division of

the Petitioner in Company Petition No.63 of 2009, the

transferor company and the merger thereof into the

resulting company i.e. the Petitioner in Company

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Petition No.64 of 2009.

2. The procedure has been complied with. The

Regional Director has filed an affidavit stating that

subject to the observations in paragraph 6 thereof,

the scheme does not appear to be prejudicial to the

interest of the shareholders and the public.

3. In paragraph 6 of the affidavit, the Regional

Director has stated that neither the petitions nor the

scheme provide details of the assets and liabilities

of the steel division of the demerged company that are

to be transferred to and vested in the resulting

company.

4. As pointed by Mr.Mehta, the Petitioners’

scheme itself in clause 1.10 defines the steel

division as under :-

“1.10 “Steel Division” means the business of

manufacturing, processing, distributing,
importing, exporting, buying selling,
assembling, repairing etc. all kinds of
steel products and ferrous and non ferrous
metal products and includes the undertaking
comprising of:

1.10.1 All assets (whether movable or
immovable, real or personal, corporeal or
incorporeal, present, future or contingent,
tangible or intangible) wherever situated
pertaining to and relatable to the Steel
Division;

1.10.2 All present and future liabilities
arising out of the activities or operations

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of Steel Business, including loans, debts,
current liabilities and provisions, duties
and obligations relatable to the Steel
Division;

1.10.3 Without prejudice to the generality of
the above, the Steel Division shall include
in particular:

a. all properties required for the
Steel Division wherever situated,
including all current assets, funds,
offices, furniture, fixtures, office

equipment, appliances, accessories,
vehicles;

b. all permits, rights,
entitlements, bids, tenders, letters of

intent, expressions of interest,
municipal and other statutory
permissions, approvals, consents,

licenses,
concessions,
registrations,
exemptions,
subsidies,
remissions
related to Steel Division, tenancies in
relation to office and factory and/or

residential property for the employees
related to Steel Division, offices,
goodwill, intellectual property rights
(including technical know how, patents,
trademarks, copy rights) related to
Steel Division, investment, cash

balances, the benefit of any deposit and
financial assets related to Steel

Division, funds belonging to or proposed
to be utilized for the Steel Division,
bank balances and bank accounts relating
to the day to day operations an specific
to the working of Steel Division,

privileges, all other rights and
benefits, lease rights, licenses, domain
names, trade name and other intellectual
property rights of any nature whatsoever
and licenses in respect thereof, powers
and facilities of every kind, nature and

description whatsoever, rights to use
and avail of telephone, telexes,
facsimile connection and installations,
utilities, power lines, electricity and
other services, provisions, funds,
benefits of all agreements, contracts
and arrangements and all other interest
in connection with or relating to the
Steel Division;

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c. all records, files, papers,
computer programs, manuals, data,
libraries, catalogues, quotations, sales
and advertising materials, lists of
present and former customers and

suppliers, customer credit information,
customer pricing information, and other
records, whether in physical form or

electronic form in connection with or
relating to the Steel Division;

d. all duties and obligations which
are relatable to Steel Division;

          e.      all   earnest    moneys    and/or
          security deposits, if     any, paid or

received by the ARIIL in connection with
or relating to the Steel Division;

1.10.4 For the purpose of this Scheme,
it is clarified that liabilities pertaining

a.

to the Steel Division include:

the liabilities, which arise out
of the respective activities or

operations of the Steel Division;

b. specific loans and borrowings
raised, incurred and utilized solely for
the respective activities or operation
of the Steel Division;

c. liabilities other than those

referred to in sub-clauses (a) and (b)
above, being the amounts of general or
multipurpose borrowings of ARIIL,
allocated to the Steel Division in the
same proportion in which the value of

the assets transferred under this Scheme
bear to the total value of the assets of
ARIIL immediately before giving effect
to this Scheme;

1.10.5 All permanent employees of ARIIL

employed in the Steel Division, as identified
by the Board of Directors of ARIIL, as on the
Effective Date;

1.10.6 Any question that may arise as
to whether a specified asset or liability
pertains or does not pertain to the Steel
Division or whether it arises out of the
activities or operations of the Steel
Division shall be decided by mutual agreement

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between the Board of Directors of ARIIL and
Resulting Company.”

. Further the schedule forming a part of the

provisional balance sheet as on 31.3.2008 and the

profit and loss account in the year ended on that date

bifurcate the details of the steel division and the

real estate division of the transferor company.





                                                 
    5.         There      is no provision in law which               requires




                                      
    the    balance sheet and profit and loss account or                       the

    scheme    enumerating        and   setting out each          and      every

    asset    which
                         
                        is the subject matter of the             scheme        of

    demerger.       My    attention has not been invited to                   any
                        
    such provision.



    6.         I    do    not    suggest that in a        given        case      a
      


    creditor,      shareholder or any other concerned party is
   



    prohibited      from    calling     for any    particulars            while

examining a scheme under Sections 391 to 394 including

a scheme of merger or demerger. Whether such an

application ought to be granted or not would depend

upon the facts of the case.

7. It is pertinent to note that in the present

case apart from stating that the details of the assets

which form a part of the scheme have not been

enumerated nothing adverse regarding the schemed as

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such is stated. Nor is it even suggested that as a

result thereof the interest of any concerned party has

been adversely affected. Further still the entire

procedure has been complied with and no objection has

been raised by any party including the creditors and

members.

8. Lastly, it is pertinent to note that the

members and the creditors of the Petitioners’ will not

be affected adversely by the scheme as there are no

creditors of the transferee company. Nor are there

any liabilities that the transferee company is exposed

to. This is so provided in the balance sheet and the

profit and loss account for the year ending 31.3.2008.

The unaudited balance sheet and the profit and loss

account for the period ended on 30.9.2008 indicates

the liability of only Rs.38,000/-. The creditors are

the directors of the company themselves. The same

does not warrant a refusal of an order sanctioning the

scheme.

9. In the circumstances, the both the Petitions

are made absolute in terms of prayers (a) to (d).

10. The Transferee Company shall lodge a copy of

this order and the scheme with the concerned

Superintendent of Stamps for the purpose of

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adjudication of stamp duty payable, if any, on the

same within thirty days of obtaining the authenticated

and/or certified copy of the order.

11. The transferor company to pay costs of

Rs.7500/- to the Regional Director. Costs to be paid

within four weeks from today.

12. Filing and issuance of the drawn up order is

dispensed with.

.

All concerned authorities to act on a copy of

this order duly authenticated by Company Registrar,

High Court, Bombay.

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