ORDER
S.K. Keshote, J.
1. In the petition, the prayer has been made that the compromise/ arrangement of amalgamation of Transferor companies in the transferee company, may be sanctioned so as to be binding on all the equity shareholders and creditors of the petitioner company.
2. On the notice of the petition, the Regional Director, Northern Region, Department of Company Affairs, Ministry of Finance, Kanpur has submitted an affidavit stating therein that the Central Government has no objection to the sanction of the proposed scheme of amalgamation and the case may be decided by the Court on merits.
3. The Official Liquidator submitted his report in the matter on 11 -9-2002. In the report he has raised two fold objections against the sanction of scheme of amalgamation of the transferor companies in the transferee company. The first objection is regarding the fractional shares to be payable to the shareholders in addition to the proposed exchange ratio in respect of Transferor Companies and the second objection is that there is no formal prayer made in the petition for dissolution of the transferor companies without the process of winding up.
4. The Court has also raised an objection that in the petition it is not disclosed that no proceedings are initiated or pending against the transferee company or any transferor companies, under sections 235 to 251 of the Companies Act, 1956.
5. The petitioner has cured all these objections. The learned counsel for the Official Liquidator is in agreement that the objections are cured.
6. I have also gone through the entire record of the petition and find that the payment of cash in lieu of fractional shares held in the transferor companies by the shareholders of the transferor companies has been made. The receipts of these payments have been produced on the record. The affidavits have been filed by the transferor companies stating therein that no proceedings have been initiated or pending in relation to any of the companies under sections 235 to 251 of the Companies Act. Further it is stated that in no proceedings under section 397 and/or under section 398 of the Companies Act are pending against any of the transferor Companies. Similarly an affidavit has also been filed in this regard of the transferee company.
7. An application has also been filed by the petitioner transferee company bearing Stamp No. 8398 dated 11-5-2004 and therein the prayer has been made that the transferor companies, as proposed in the scheme of amalgamation and approved by the shareholders and creditors of the transferee company, be dissolved without winding up.
8. Thus all these objections raised in the matter either by the Official Liquidator in his report or the Court, stand cured.
9. The object and purpose to obtain sanction of the Court of proposed scheme of amalgamation of the transferor companies in the transferee company has been detailed in para No. 4 of the petition.
10. The transferee company and transferor companies moved separate applications for direction to convene a meeting of equity shareholders and creditors, under section 391 of the Companies Act, 1956 before this Court on 17-10-2002. On the said applications the Court pleased to order for holding the meetings of the equity shareholders and creditors of respective companies on 4-1 -2003 at the registered office of the Companies and the Court appointed Shri Manoj Pareek, Advocate to act as the Chairman of the meetings of equity shareholders and creditors of the Companies. The Court further directed the companies to give notice of convening aforesaid meetings together with a copy of the scheme of compromise/ arrangement, statement of affairs under section 393, form of proxies, under the certificate of posting addressed to each shareholder and creditor to be held at the registered office of the companies.
11. The publication thereof has also been ordered to be made in the ‘Dainik Bhaskar’ and ‘Dainik Rashtradoot’. This order has been complied with as I find in para No. 17 of the petition.
12. On 4-1-2003 the meetings of the shareholders and the creditors of the companies were held in accordance with the direction of the Court at the registered office of the companies. Shri Manoj Pareek, Advocate, the Chairman of the meetings, reported the proceedings of the meetings of the companies wherein it has been stated that meetings of all the companies were attended by the shareholders, creditors either individually or through their proxies. The scheme of compromise or arrangement was read out and explained by the Chairman to the shareholders and the creditors present in the meetings and it was unanimously approved by all the shareholders, creditors present either in person or by proxy.
13. The details of incorporation, authorized share capital, issued, subscribed and paid up capital of the transferee company are given in para No. 2 of the petition.
14. The details of incorporation of Transferor Company, Bhutoria Agricultural Farms Private Limited, its share capital, issued, subscribed and paid up capital has been given in para No. 4 of the petition.
15. The details of incorporation of Transferor Company, Nirmal Dairy Private Limited, its share capital, issued, subscribed and paid up capital has been given in para No. 5 of the petition.
16. The details of incorporation of Transferor company, Bhutoria Stamping Private Limited, its share capital, issued, subscribed and paid up capital has been given in para No. 5 of the petition.
17. The objects of the transferee company set out in its memorandum and articles of association are detailed out in para No. 6 of the petition.
18. The objects of the transferor companies set out in its memorandum and articles of associations are detailed out in para Nos. 7, 8 and 9 of the petition.
19. The audited results as on 31-3-2002, the financial results of the transferee company and the transferor companies are detailed out in para Nos. 10, 11, 12 and 13 of the petition.
20. From the petition I find that the transferee and transferor companies have maintained proper books of account, as required under the law. The object of the petition is ultimately to obtain sanction of the Court to the scheme of amalgamation proposed to be made between the transferor companies and transferee company whereunder it is proposed to merge the transferor companies into the transferee company without the process of winding up.
21. The terms and conditions and consideration of the scheme are fully stated in the scheme of amalgamation.
22. The sanction of scheme of amalgamation will be for the benefit of transferor companies as well as transferee company.
23. Having regard to the averments made in the petition, the affidavit of the Regional Director, Northern Region, Department of Company Affairs, Ministry of Finance, Kanpur has not objected the merger of the transferor companies into the transferee company, the report of the official liquidator and from the audited results as on 31 -3-2002, the financial results of the transferor and transferee companies, I am satisfied that the transferor and transferee companies have disclosed to the Court all the material facts relating to them as required under proviso to Sub-section (2) of section 391 of the Act, 1956. The scheme of amalgamation of the transferor companies in the transferee company has been unanimously approved by all the shareholders and creditors. The Central Government, as said earlier, has no objection to the scheme of amalgamation if granted by this Court. Thus, I do not find any legal or factual impediment to grant/sanction the scheme of amalgamation of the transferor companies into the transferee company.
24. In these facts and having been satisfied on the basis of the material produced on the record, I am of the view that the prayer made in the petition deserves acceptance.
25. In the above facts and circumstances of the case, the scheme of merger/amalgamation of the transferor companies in the transferee company is hereby sanctioned under section 391(2) of the Act, 1956.
26. The transferor companies shall stand dissolved without the process of winding up.
27. The petition accordingly stands disposed of.