Punjab-Haryana High Court
Fresh Property Development Pvt Ltd vs ------------------ on 10 October, 2014
Author: Rajesh Bindal
Bench: Rajesh Bindal
VARINDER SINGH
2014.10.28 09:14
Company Petition No. 87 of 2014 (1) I attest to the accuracy and integrity
of this document
Punjab & Haryana High Court at
Chandigarh
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
Company Petition No. 87 of 2014
Connected with
Company Petition No. 68 of 2014
Date of decision: 10.10.2014
IN THE MATTER OF:
THE COMPANIES ACT, 1956 (1 OF 1956)
AND IN THE MATTER OF :
Scheme of Amalgamation of
Dr. Fresh Property Development Private Limited
....Petitioner -Transferor Company
WITH
Dr. Fresh Health Care Private Limited
....Petitioner -Transferee Company
Present: Mr. Sumeet Goel, Advocate for the petitioner-Companies.
Mr. D.P. Ojha, Official Liquidator.
Rajesh Bindal, J.
In this petition under Sections 391 (2) and 394 of the Companies Act, 1956 (for short, 'the Act', duly supported by affidavits, the petitioner-Transferor and Transferee Companies seek the sanctioning of the Scheme of Amalgamation (Annexure P/1).
Main objects of the petitioner-Transferor Company and the Transferee Company are detailed in their respective Memorandum and Articles of Association annexed with the petition at Annexure P-2, and P- 6, respectively.
It is averred in the petition that the Registered offices of the petitioners-Transferor and Transferee Companies are situated at Gurgaon (Haryana).
The Board of Directors of the Dr. Fresh Property Development Private Limited (petitioner-Transferor Company) and Dr. Fresh Health Care Private Limited (Transferee Company) have approved the Scheme of Amalgamation in their respective meetings held on 17.2.2014.
VARINDER SINGH 2014.10.28 09:14 Company Petition No. 87 of 2014 (2) I attest to the accuracy and integrity of this document Punjab & Haryana High Court at Chandigarh Both the Transferor and Transferee Companies are closely held family companies and Shareholders in the Transferor Company are three, whereas in the Transferee Company these are six.
Earlier, the petitioner- Companies had approached this Court by filing Company Petition No. 68 of 2014. Vide order dated 22.4.2014 passed therein holding of meeting of the shareholders and unsecured creditors of the petitioner companies was dispensed with and the Ist Motion Petition was disposed of accordingly.
Notice of the present Second Motion Petition was issued to the Regional Director, Ministry of Corporate Affairs, Noida, the Official Liquidator and was also ordered to be published in the daily 'The Business Standard' (English) and 'Dainik Bhaskar' (Hindi), both Delhi editions and in the official Gazette of the Government of Haryana. The aforesaid order has been complied with and an affidavit to this effect has been placed on record.
Pursuant thereto, the Official Liquidator has placed on record the report dated 11.8.2014 by way of affidavit of Mr. A. K. Chaturvedi, Regional Director, Northern Region, Ministry of Corporate Affairs, Noida. In para 4 and 5, he has pointed that:-
"4. That the Deponent craves leave to submit that as per clause 11 (a) of the Scheme it has been stated that upon the scheme becoming effective, amalgamation of the Transferor Company with the Transferee Company will be accounted that, the amalgamation shall be an "amalgamation in the nature of merger" as defined in the Accounting Standard (AS) 14 as prescribed under the Companies (Accounting Standards) Rules, 2006, and shall be accounted for under the "pooling of interests" method in accordance with the said AS-14.
5. That the deponent craves leave to submit that with reference to this Director's letter dated 29.05.2014, forwarded to The Chief Commissioner of Income Tax, PH-5, Udyog Vihar, Udyog Vihar, Gurgaon - 122 016 and the same has been returned back undelivered with not mentioning any postal remarks. However, from the reply received from the Advocates to the Petitioner Companies VARINDER SINGH 2014.10.28 09:14 Company Petition No. 87 of 2014 (3) I attest to the accuracy and integrity of this document Punjab & Haryana High Court at Chandigarh dated 28.07.2014 has stated that the copy of petition along with the scheme to the concerned Income Tax Office has been filed. However, till date no report/ comments have been received from the Income Tax Department."
As regards the objections raised in para 4 and 5 of affidavit dated 11.8.2014 of the Regional Director, the learned counsel for the petitioner companies has undertaken that the petitioner-Companies shall comply with/adopt accounting treatment as prescribed under Accounting Standard-14 as per law. Learned counsel has also undertaken to discharge the income tax liability, if any, as per law.
The above-stated undertaking submitted by the counsel for the petitioner companies meets the queries raised by Regional Director.
The Official Liquidator has also submitted his report dated 17.9.2014 stating therein that in view of the observations of the Chartered Accountant, the amalgamation is not pre-judicial to the interest of Shareholders, public at large, creditors and Income Tax Department.
The issue was raised in the report of the Official Liquidator regarding leasing out of land at nominal lease money; writing of miscellaneous expenditure in the FY 2010-11 and 2011-12, on uneven basis, issue of 102523 equity shares (Face value of ` 10 per share) as on 25.5.2011 to "Ascends India Development II Pte Ltd.", having its registered office at 61 Science Park Road, # 04-01 The Galen Singapore Park II, Singapore- 117525, at ` 2343.34 per share (i.e. at a premium of ` 2333.34), when FMV as per CA certificate was ` 214/- per share and the book value of the shares as on 31.3.2011 was in negative.
The Official Liquidator has also pointed out defaults regarding directorship. It was pointed out that as per Section 275 of the Act, a person cannot hold position as a director in more than 15 companies, whereas Abhay Kumar Aggarwal, Director of the Transferor Company was holding the position of director in 22 companies (as on appointed date i.e. 18.7.2007), which is in violation of Section 275 of the Act. The non- compliance continues till date according to Section 165 of the Companies Act, 2013, in which the Directorship cannot exceed 20 in number.
VARINDER SINGH 2014.10.28 09:14 Company Petition No. 87 of 2014 (4) I attest to the accuracy and integrity of this document Punjab & Haryana High Court at Chandigarh In the affidavit dated 3.10.2014, of Abhay Kumar Aggarwal, Director of the Transferor Company, it has been explained that as the transaction for lease of land was between the group companies having common shareholders and directors, no public interest was adversely affected. The old items of miscellaneous expenditure were written off by the company. 51% stake in the Transferor and Transferee Companies was taken by Ascends India Development II Pte. Ltd., Singapore. The rates on which the shares were allotted to Ascends India Development II Pte. Ltd. was explained by stating that the value was determined by considering the value of the assets owned by the company. The price was not less than the fare market value. Regarding Mr. Abhay Kumar Aggarwal, being a director in more than 15 companies, it was explained that the limit was for being a director in public limited companies. Mr. Abhay Kumar Aggarwal was director in four public limited companies. All others were private limited companies. Further reference was made to the Companies Act, 2013, enforced from 1.4.2014, where one year time has been granted to comply with the provisions wherever required.
The petitioner-Companies have confirmed that there are no investigations or proceedings pending against them under Sections 235 and 251 of the Act.
For the reasons afore-stated and on consideration of all the relevant facts and the procedural requirements contemplated under Sections 391 to 394 of the Act, and the relevant Rules and on due consideration of the reports of Regional Director, Northern Region, Ministry of Corporate Affairs Noida and the Official Liquidator, the Scheme of Amalgamation is hereby sanctioned and as a result thereto, the assets and liabilities of the Transferor Company shall stand vested in the Transferee Company and the Transferor Company shall be dissolved without being wound up. The Transferee Company shall be required to comply with the procedural requirements with regard to Accounting Standard-14 as per law and all the compliances as required by the Income Tax Authorities, if any, as per law.
The Scheme shall be binding on the Transferor and Transferee Companies, their respective Shareholders, Creditors and all concerned.
VARINDER SINGH 2014.10.28 09:14 Company Petition No. 87 of 2014 (5) I attest to the accuracy and integrity of this document Punjab & Haryana High Court at Chandigarh Let formal order of sanction of the Scheme of Amalgamation be drawn in accordance with law and its certified copy be filed with the Registrar of Companies within 30 days from the date of receipt thereof.
A notice of the order be published in the 'The Business Standard' (English) and 'Dainik Bhaskar' (Hindi), both Delhi editions and in the official Gazette of the Government of Haryana.
Any person interested shall be at liberty to apply to the Court for any direction(s) as per law.
Disposed of accordingly.
10.10.2014 (Rajesh Bindal) vs Judge