Gujarat High Court
Elecon Engineering Companiy Limited vs Respondent(S) on 7 July, 2016
Author: R.M.Chhaya
Bench: R.M.Chhaya
O/COMA/291/2016 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
COMPANY APPLICATION NO. 291 of 2016
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ELECON ENGINEERING COMPANIY LIMITED....Applicant(s)
Versus
.....Respondent(s)
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Appearance:
MRS SWATI SOPARKAR, ADVOCATE for the Applicant(s) No. 1
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CORAM: HONOURABLE MR.JUSTICE R.M.CHHAYA
Date : 07/07/2016
ORAL ORDER
1. This application is filed by the abovenamed Applicant Transferee Company by summons dated 04th July 2016 filed under Sections 391 to 394 of the Companies Act, 1956, in a proposed Scheme of Amalgamation of Election EPC Projects Limited, the Transferor Company with Elecon Engineering Company Limited, the Applicant Transferee Company; as proposed between the Applicant Company and its Shareholders and Creditors. Smt.Swati Soparkar, learned counsel appears for the applicant Company. The submissions are made for (i) dispensation of the meetings of the Secured and Unsecured Creditors of the Applicant Company and (ii) seeking directions for convening a meeting of the Equity Shareholders of the Applicant Company;
2. It has been submitted vide para 14 of the affidavit in support of the Judge's Summons that the rights and interests of the Secured and/or Unsecured Creditors of the Applicant Company shall not be affected in any Page 1 of 6 HC-NIC Page 1 of 6 Created On Thu Jul 14 00:11:54 IST 2016 O/COMA/291/2016 ORDER manner as a result of the proposed scheme. The proposed scheme does not envisage any arrangement or compromise with the creditors of the Applicant Transferee Company. The Applicant Transferee Company is a profit making Company and have substantial positive net worth. The said contention is substantiated by a Net Worth Certificate issued by a Chartered Accountant, placed on record as Exh:F. The said certificate indicates that the net worth of the Transferee Company in Pre-Scheme scenario is Rs.510.39 crores and post scheme scenario shall be approximately Rs.601.21 crores. It is further submitted that notwithstanding the above contention, in compliance with the contractual terms of the loan agreements with the secured creditors, the applicant Transferee Company has already approached its Secured Creditors and sought their approval to the proposed scheme. The Applicant Transferee Company has undertaken that the approval shall be obtained from all its Secured Creditors in form of written consent letters and the same shall be placed on record of this Court before the final sanction of the Scheme. Considering the facts and circumstances, dispensation from holding of such meetings of the Secured and Unsecured Creditors of the Applicant Company is granted.
3. Attention of the Court has been further drawn to para 10 of the said affidavit in support of the Judge's Summons. It has been pointed out that being a listed public limited Company, the Applicant has obtained the requisite prior approval of SEBI through the concerned stock exchanges viz. BSE Limited and National Stock Exchange of India Limited and the observation letters are already placed on record as Exh:E. It has been Page 2 of 6 HC-NIC Page 2 of 6 Created On Thu Jul 14 00:11:54 IST 2016 O/COMA/291/2016 ORDER further pointed out that in compliance of clause 9 of Annexure- 1 of SEBI Circular No.CIR/CFD/CMD/16/2015 dated November, 30, 2015, the Applicant Company shall undertake the procedure of postal ballot and e-voting for seeking approval from the public shareholders. The Applicant Company is hereby directed to place the result of the said poll on record of the Court alongwith the report of the Chairman providing the result of the meeting of the Equity Shareholders.
It is ordered -
4. That a meeting of the Equity Shareholders of the Applicant Company shall be convened and held at Audio Visual Hall, Eimco Elecon Building, Anand-Sojitra Road, Vallabh Vidyanagar, Anand - 388 120 in the State of Gujarat on Friday, 19th August, 2016 at 11:00 a.m, for the purpose of considering and if thought fit, approving with or without modifications, the Scheme of Amalgamation of Elecon EPC projects Limited, the Transferor Company with Elecon Engineering Company Limited, the Applicant Transferee Company; as proposed between the company and its shareholders.
5. That at least 21 clear days before the meeting to be held as aforesaid, Notice convening the said meeting, indicating the day, the date, the place, and time as aforesaid, together with a copy of the Scheme of Amalgamation, copy of the Explanatory Statement required to be sent under Section 393 of the Companies Act, 1956 and the prescribed Form of Proxy shall be sent by a Courier/Registered Post/Speed Post or through Email (to Page 3 of 6 HC-NIC Page 3 of 6 Created On Thu Jul 14 00:11:54 IST 2016 O/COMA/291/2016 ORDER those shareholders whose email addresses are duly registered with the Applicant Company for the purpose of receiving such notices by email) to each of the Equity Shareholders of the Applicant Company, at their last known address. The list of shareholders with their names and addresses shall be placed on record by the Applicant Company. A certificate shall be obtained confirming the total number of dispatches so made.
6. That at least 21 clear days before the meeting to be held as aforesaid, Notice convening the said meeting indicating the day, the date, the place and time as aforesaid be published, stating that copies of the Scheme of Amalgamation, the Explanatory Statement required to be furnished pursuant to Section 393 of the Companies Act, 1956 and Form of Proxy can be obtained free of charge at the registered office of the Applicant Company and/or at its Advocate's office i.e. 301, Shivalik - 10, Opp. SBI Zonal Office, S.M.Road, Ambawadi, Ahmedabad-380 015; once each in the English Daily "Times of India", Ahmedabad Edition and the other in Gujarati daily "Sandesh" Ahmedabad Edition.
7. Shri Prayasvin B. Patel, Chairman & Managing Director of the Applicant Company and failing him Shri Prashant C. Amin, Executive Director of the Applicant Company and failing him Shri Rajat Jain, Chief Financial Officer of the Applicant Company, shall be the Chairman of the aforesaid meeting to be held on 19th August, 2016 and in respect of any adjournment or adjournments thereof.
8. That the Chairman appointed for the aforesaid Page 4 of 6 HC-NIC Page 4 of 6 Created On Thu Jul 14 00:11:54 IST 2016 O/COMA/291/2016 ORDER meeting do issue advertisements and send out notices of the said meeting referred to above. It is further directed, that the Chairman of the meeting shall have all powers under the Articles of Association of the Applicant Company and under the Companies (Court) Rules, 1959 in relation to conduct of meeting, including an adjournment of the meeting, and/or an amendment to the Scheme or Resolution, if any, proposed at the meeting by any person(s) and to ascertain the decision of the meeting on a poll.
9. That the quorum for the said meeting shall be 30 (thirty) for the meeting of the Equity Shareholders, present in person or through authorized representative or through proxy.
10. That voting by proxy is permitted provided that the proxy in the prescribed form and duly signed by the person entitled to attend and vote at the aforesaid meetings, or by his authorized representative, is filed with the Applicant Company at its registered office at Vallabh Vidyanagar, not later than 48 hours before the said meeting.
11. That the value of the vote of each shareholder of the Company shall be as per the entries in the Registers of the company and where the entries in the Records or Registers are disputed, the Chairman of the meeting shall determine the value or number for the purpose of the meeting and his decision in that behalf would be final.
12. That the Chairman do report to this Court, the result of the said meeting within 14 days of the Page 5 of 6 HC-NIC Page 5 of 6 Created On Thu Jul 14 00:11:54 IST 2016 O/COMA/291/2016 ORDER conclusion of the meeting and the said report shall be verified by his affidavit. As aforesaid in para 3 of the order, the result of the postal ballot and e-voting by the public shareholders shall be placed on record wit the said report of the Chairman.
The application stands disposed of.
(R.M.CHHAYA, J.) Suchit Page 6 of 6 HC-NIC Page 6 of 6 Created On Thu Jul 14 00:11:54 IST 2016