Delhi High Court
Fiitjee (Ranchi Classes) Limited vs ... on 25 May, 2015
Author: Sudershan Kumar Misra
Bench: Sudershan Kumar Misra
IN THE HIGH COURT OF DELHI
COMPANY PETITION NO. 661/2014
Reserved on 19th May, 2015
Date of pronouncement: 25th May, 2015
In the matter of
The Companies Act, 1956 & the Companies Act, 2013 (to the extent
applicable):
And
Petition under Sections 391 to 394 of the
Companies Act, 1956
Scheme of Amalgamation of:
FIITJEE (Ranchi Classes) Limited
Petitioner/Transferor Company No. 1
FIITJEE (Hyderabad Classes) Limited
Petitioner/Transferor Company No. 2
FIITJEE (South Delhi Classes) Limited
Petitioner/Transferor Company No. 3
Guru Education Limited
Petitioner/Transferor Company No. 4
FIITJEE Edusoft Limited
Petitioner/Transferor Company No. 5
FIITJEE (Lucknow Classes) Limited
Petitioner/Transferor Company No. 6
WITH
FIITJEE Limited
Non-Petitioner/Transferee Company
Through Ms. Maneesha Dhir, Mr. Milan
Singh Negi, and Mr. Hemant Sharma
Advocates for the petitioners
SUDERSHAN KUMAR MISRA, J.
1. This joint petition has been filed under Sections 391 to 394 of the Companies Act, 1956 by the petitioner companies seeking sanction of the Scheme of Amalgamation of FIITJEE (Ranchi Classes) Limited (hereinafter referred to as the transferor company no. 1); FIITJEE CP 661/2014 Page 1 of 10 (Hyderabad Classes) Limited (hereinafter referred to as the transferor company no. 2); FIITJEE (South Delhi Classes) Limited (hereinafter referred to as the transferor company no. 3); Guru Education Limited (hereinafter referred to as the transferor company no. 4); FIITJEE Edusoft Limited (hereinafter referred to as the transferor company no. 5); and FIITJEE (Lucknow Classes) Limited (hereinafter referred to as the transferor company no. 6) with FIITJEE Limited (hereinafter referred to as the transferee company).
2. The registered offices of the transferor and transferee companies are situated at New Delhi, within the jurisdiction of this court.
3. The transferor company no. 1 was incorporated under the Companies Act, 1956 on 23rd April, 2003 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.
4. The transferor company no. 2 was incorporated under the Companies Act, 1956 on 19th April, 2004 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.
5. The transferor company no. 3 was originally incorporated under the Companies Act, 1956 on 31st March, 1997 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi under the name and style of Overseas Campus Educations (India) Private Limited. The CP 661/2014 Page 2 of 10 company changed its name to Overseas Campus Educations (India) Limited and obtained the fresh certificate of incorporation on 20th April, 2004. The company again changed its name to FIITJEE (South Delhi Classes) Limited and obtained the fresh certificate of incorporation 8th July, 2004.
6. The transferor company no. 4 was originally incorporated under the Companies Act, 1956 on 19th April, 2004 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi under the name and style of FIITJEE (Kota Classes) Limited. The company changed its name to Guru Education Limited and obtained the fresh certificate of incorporation on 25th April, 2007.
7. The transferor company no. 5 was originally incorporated under the Companies Act, 1956 on 3rd August, 2001 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi under the name and style of Bhargavi Softech Private Limited. The company changed its name to Bhargavi Softech Limited and obtained the fresh certificate of incorporation on 19th April, 2004. The company again changed its name to FIITJEE Edusoft Limited and obtained the fresh certificate of incorporation 6th July, 2004.
CP 661/2014 Page 3 of 10
8. The transferor company no. 6 was incorporated under the Companies Act, 1956 on 4th November, 2004 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.
9. The transferee company was incorporated under the Companies Act, 1956 on 13th October, 1997 with the Registrar of Companies, NCT of Delhi & Haryana at New Delhi.
10. The present authorized share capital of the transferor company no.1 is Rs.50,00,000/- divided into 5,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.38,17,000/- divided into 3,81,700 equity shares of Rs.10/- each.
11. The present authorized share capital of the transferor company no.2 is Rs.1,25,00,000/- divided into 12,50,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.1,18,00,000/- divided into 11,80,000 equity shares of Rs.10/- each.
12. The present authorized share capital of the transferor company no.3 is Rs.20,00,000/- divided into 2,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.5,00,000/- divided into 50,000 equity shares of Rs.10/- each. CP 661/2014 Page 4 of 10
13. The present authorized share capital of the transferor company no.4 is Rs.20,00,000/- divided into 2,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.20,00,000/- divided into 2,00,000 equity shares of Rs.10/- each.
14. The present authorized share capital of the transferor company no.5 is Rs.20,00,000/- divided into 2,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.5,00,000/- divided into 50,000 equity shares of Rs.10/- each.
15. The present authorized share capital of the transferor company no.6 is Rs.20,00,000/- divided into 2,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.5,00,000/- divided into 50,000 equity shares of Rs.10/- each.
16. The present authorized share capital of the transferee company is Rs.60,00,00,000/- divided into 6,00,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.42,52,99,270/- divided into 4,25,29,927 equity shares of Rs.10/- each.
17. Copies of the Memorandum and Articles of Association of the transferor and transferee companies have been filed on record. The audited balance sheets, as on 31st March, 2014, of the transferor and CP 661/2014 Page 5 of 10 transferee companies, along with the report of the auditors, have also been filed.
18. A copy of the Scheme of Amalgamation has been placed on record and the salient features of the Scheme have been incorporated and detailed in the petition and the accompanying affidavit. It is submitted by the petitioners that the transferor and transferee companies have common business interest and the main objective of the Scheme is to enable creation of a larger entity and derive optimal synergy benefits.
19. So far as the share exchange ratio is concerned, the Scheme provides that the transferor companies are wholly owned subsidiaries of the transferee company.
20. It has been submitted by the petitioners that no proceedings under Sections 235 to 251 of the Companies Act, 1956 are pending against the transferor and transferee companies.
21. The Board of Directors of the transferor and transferee companies in their separate meetings held on 21st March, 2014 have unanimously approved the proposed Scheme of Amalgamation. Copies of the Resolutions passed at the meetings of the Board of Directors of the transferor and transferee companies have been placed on record. CP 661/2014 Page 6 of 10
22. The petitioner companies had earlier filed CA (M) No. 126/2014 seeking directions of this court to dispense with the requirement of convening the meetings of their equity shareholders, secured and unsecured creditors, which are statutorily required for sanction of the Scheme of Amalgamation. Vide order dated 12th September, 2014, this court allowed the application and dispensed with the requirement of convening and holding the meetings of the equity shareholders and unsecured creditors of the transferor and transferee companies, there being no secured creditors of the petitioner companies, to consider and, if thought fit, approve, with or without modification, the proposed Scheme of Amalgamation. This Court vide order dated 26th September, 2014 passed in CA 2248/2014 also directed that no separate or joint application under Section 391/394 of the Companies Act, 1956 is required to be filed by transferee/holding company.
23. The petitioner companies have thereafter filed the present petition seeking sanction of the Scheme of Amalgamation. Vide order dated 31st October, 2014, notice in the petition was directed to be issued to the Regional Director, Northern Region, and the Official Liquidator. Citations were also directed to be published in 'Statesman' (English) and 'Jansatta' (Hindi) editions. Affidavit of service has been filed by the petitioners showing compliance regarding service on the Official Liquidator and the Regional Director, Northern Region and also regarding publication of citations in the aforesaid newspapers on 26th November, 2014. Copies of CP 661/2014 Page 7 of 10 the newspaper clippings containing the publications have been filed along with the said affidavit.
24. Pursuant to the notices issued, the Official Liquidator sought information from the petitioner companies. Based on the information received, the Official Liquidator has filed a report dated 15th December, 2014 wherein he has stated that he has not received any complaint against the proposed Scheme of Amalgamation from any person/party interested in the Scheme in any manner and that the affairs of the transferor companies do not appear to have been conducted in a manner prejudicial to the interest of their members, creditors or public interest, as per second proviso of Section 394(1) of the Companies Act, 1956.
25. In response to the notices issued in the petition, Mr. A. K. Chaturvedi, Regional Director, Northern Region, Ministry of Corporate Affairs has filed his report dated 18th December, 2014. Relying on Clause 13.1 of Part-IV of the Scheme, he has stated that, upon sanction of the Scheme of Amalgamation, all the employees of the transferor companies shall become the employees of the transferee company without any break or interruption in their services. He has further submitted that in Clause 9.1 of Part-III of the Scheme, it has been stated that the amalgamation shall be an 'Amalgamation in the nature of merger' as defined in Accounting Standard-14 issued by the Institute of Chartered Accountants of India and shall be accounted for under the 'pooling of CP 661/2014 Page 8 of 10 interest method' in accordance with the said accounting standard. He further submitted that in Clause 10 of the Scheme, it has been stated that upon this scheme becoming effective, the transferor company nos. 1 to 6 shall stand dissolved without the process of winding up.
26. No objection has been received to the Scheme of Amalgamation from any other party. The petitioner companies, in the affidavit dated 27th February, 2015 of Mr. Rakesh Aggarwal, Director of the petitioner companies, have submitted that neither the petitioner companies nor their counsel have received any objection pursuant to the citations published in the newspapers on 7th January, 2015.
27. Considering the approval accorded by the equity shareholders and creditors of the petitioner companies to the proposed Scheme of Amalgamation and the affidavits filed by the Regional Director, Northern Region, and the Official Liquidator not raising any objection to the proposed Scheme of Amalgamation, there appears to be no impediment to the grant of sanction to the Scheme of Amalgamation. Consequently, sanction is hereby granted to the Scheme of Amalgamation under Sections 391 and 394 of the Companies Act, 1956. The petitioner companies will comply with the statutory requirements in accordance with law. Certified copy of this order be filed with the Registrar of Companies within 30 days. It is also clarified that this order will not be construed as an order granting exemption from payment of stamp duty as payable in CP 661/2014 Page 9 of 10 accordance with law. Upon the sanction becoming effective from the appointed date of Amalgamation, i.e. 1st April, 2014, the transferor companies no. 1 to 6 shall stand dissolved without undergoing the process of winding up.
28. Learned counsel for the Official Liquidator prays that costs of at least Rs.1.5 lakhs should be paid by the petitioners keeping in view the fact that the matter has involved examination of extensive records and also prioritized hearings. Learned counsel for the petitioner companies states that the same is acceptable to him. Looking to the circumstances, the petitioner shall deposit a sum of Rs.1.5 lakhs by way of costs with the Common Pool Fund of the Official Liquidator within two weeks.
29. The petition is allowed in the above terms.
Dasti.
SUDERSHAN KUMAR MISRA, J.
May 25, 2015 CP 661/2014 Page 10 of 10