Karnataka High Court
Singapore Telecommunication Limited vs Kirloskar Computer Services Limited on 6 September, 2012
Author: L.Narayana Swamy
Bench: Ram Moran Reddy, L.Narayana Swamy
IN THE HIGH COURT OF KARNATAHA, BANGALORE
DATED THIS THE 13th DAY OF JULY, 2005
BEFORE
THE HONBLE MR JUSTICE RAM MORAN REDDY
IPANY PETITIoLQ498 22Q
BE'IWEEN
IHA K lOUSING FINANCE LI I)
A OMP4 INORPORAIED UNDER
Till' ( MPANIFS ALl, 1956, HAVING
115 RFGD OFFICE AT 1516,
VAYUDOO PH CHAMBERS, 4'' FLOOR,
FRINI'IY JUNCTION, M G ROAD,
I3ANGALORL 560 001.
REP. BY ITS MANAGING DIRECTOR
MR. M R ADYANTHAYA. --PETPTIONFR
(BY SRI UDAYA HLLA, ADV,)
AND
NIL RESPONDENY
THIS PETITION IS FILED UNDER SECTIONS 391 TO
394 OF THE COMPANIES ACT, 1956 TO SANCTION THE
SCHEME OF AMALGAMATION AND ETC.,
THIS PETITK)N COMING ON FOR ORDERS, THIS DAY
THE COURT MADE THE FOLLOWING;
a
2
ORDER
The petitioner a Compar.y, for short the 'Transtèror company' incorporat.d on th 20 October 1995 under the Companies Act, 1956 (for short 'Act') having its registered office at No. 15 16, Vayudooth Chambers, 4 t h Floor, Trinity Junction, MG. Road, Banga1ore560 001 bas presented this petition seekm g sanction of the scheme of amalgamation Exhibih" F".
2. The main objects of the Transteror company is to earn' on business of providing long term fmance to any person or persons, firm, company, corporation, society, association of person-s on such terms and conditions as the company may deem ft for the purpose of construction or purchase of house/flat in India br residential purpose, amongst other objects set out in the Memorandum and Articles of asscwiation Exhibit'B"
3 The Authorised share capital of the Transferor company is Es, 10 crores divided into I crore Equity shares of Es. 10/ each while the issued, subscribed and paid up share capital is Es. 10 crores divided into 10 lakh Equity shares of Rs.10/- each.
4. The Balance Sheet made up to 3iH032004 Exhibih "As of the Transferor company duly audited by its Audito rs discloses its assets and liabilities.
5. The Board of Directors of the Transferor company , in its meeting approved and adopted the scheme of amalgamation Exhibit--"E" whereunder the Transferor company is proposed to be merged with M/ s Vijaya Bank, for short the 'Transferee company', a Company constitute d under the Banking Companies (Acquisition and Tran ster of Undertakings) Act, 1980 (for short 'Banking Companies Acquisition Act') having its registered office at 41/2 , M.G Road, Bangalore, subject to the sanction of the sche me of amalgamation. by this Court,
6. The Transferor company is the wholly owned subsidiary of the Transferee company which holds all the shares issued by the Transferor company either in its own name or by its nominees. The Transferor Company made an 4 application in (1ANo764/2O&4 seeking pennission to ccnvene and hold the meetings of t]..e members. and creditors for considering the scheme of amalgamation Exhibit-E". This Court, by order dated 2 II 2OO4 allowed the application and granted permission sought for The meetings of the members mid creditors of.. the Transferor Company were held on the appointed date, thne and place in compliance with the order dated 2" 11 20O4 of this Court. All the members and creditors who attended the meeting unaniniously approved the scheme of amalgamation ExhibiP as is evident from the report of the Chainnan of the .
meethg Exhibit"CY.
7. The main objects of the Transferee company is to establish and carry on the business of a Bank amongst other objects set out in th...e Memorandum and Articles of Association Exhibit'D", 8 The Authorised share capital of the Transtèree company is Rs 1,500 Crore divided into kiO crore Equity shares of [in. 10/ each while the Issued, subscribed and c paihup !hare capital is Rs.433,51,78,OOO/. The. Tra..sleree company has produced. the latest Balance Sheet ExhibiicCS made up to 31O3-2OO4 dul audited by its Auditors disclosing its assets and liabilities,
9. The memorandum of association of both the Ccmpa.ies permit amalgamation while Section 6(1)(m) of the Banking Companies Regulation Act, 1949 (for short 'Banking Regulation Act also permits the amalgamation. The Reserve Bank of India. by its letter dated 2 lO72OO4 Exhibit-"H" accorded approval to the scheme of amalgamation.
10. The petition was admitted and notices ordered on the Regional Directcr of Company Affairs, Chennai and the Official Liquidator. The request of the Official Liqmdator for appointment of a Chartered Accountant to investigate into the affairs of the Transferor company was allowed by order dated lr022005 in OLR No6l/2005 and 198/2004. The Official Liquidator, in his report dated 28032005 enclosed the report Dt. 10I2O05. Sri. Anand Rao, Char ered Accountant, w.ho after baring investigated into th,e affairs of a the Transferor company for a period of five years preceding the accounting year 2OO4-O5, opined that the affairs of the Transferor corn,.••.py have not been c...ondueted in a manner prejudicial to the interest of its members or the publicS
11. The Regional Director of Company Affairs filed a report dated 28O32OO5 stating that the Transferee company is a scheduled Bank a com.pany, within, the meaning of the said term tmder the Banking Companies Acquisition Act, and hence, not a transferee company under Sectioj. 394(4)(b) of the 'Act.'. in. addition it is stated that no separate petition is filed by the Transferee company.
lL The material on record discloses •that the entire shares of the Transferor company is held by the Transferee company mid i.ts nom.inees as reflected in the Balance Sheets Exhibits "A" and "C". The Board of Directors of both the Companies have opined that the merger of the companies would be beneficial and profitable to operate as a single unit instead of two different units. The Transferee company is said to be a. consistent profit making company. In order to *1-.
have synergy of operation an also to avoid administrative overheads, they have decided to amalgamate into one unit so that they can avail the advautage of largescaie operation it is also said that the financial base of the. amalgamated company would he considerably enhanced. Since the Thm stemr company is the subsidiary of th.e Transferee company, its holding company, t is contended that the scheme does not affect the rights of members or creditors of the Transferee company as between themselves and the Tran.sferor company or does not involve re'organisation of the share capital of the Transferee company.
13. The material on record further discloses that the Transfrror company convened and held the meeting of shareholders and creditors in accordance with Sc.ction 391 of the Act and in tenus of the other dated 2 11 2004 passed by this Court in C. A. No.764/2004. The members of the Transferor company who are none other than the members of the Transferee company, who attended th.e meeting unanimously approved the scheme of amalgamation Exhibfl* ape The coreditors of the Transferor company who attei.ded 8 the meeting, too, unanimously approved the scheme of amaigamation. The statutory req inrement as contained in Section 291(2) of the Act is complied with.
The Auditors' report, discloses that the affairs of the Tran sferor company are not conducted in a manner prejudicial to the interest of the members, creditors or the public. Despite the publicaÜon of the healing of this petition, none of the members, creditors, employees or any othe r person have appeared before this Court to oppose the scheme of amalgamation. The report of the Official Liqu idator discloses that be has no objection for according sanction.
14 The terms of the scheme of amalgamation Exbihit "E" indicate that, with effect from the said date, all debts, liabilities, dues and obligations of the Tran sferor company and any accretions or additions or deletions thereto, after the appointed date, shall without any further act or instrnment. or deed stand transferred or deemed to be trnnstbrred and vested in the Transferee company so as to become as and from that date, the debts, hsbu lities, dues and obligations of the Transferee Company. Upo n the Sc heme of 0 Amalgamation being sanctioned and becom.ing finally effective, no fresh shares of the of the Transferee company are to be •••o•t...ted to acquir the assets and liabilities cf the Transferor company while the share capital of the Transferor company stands cancelled aid reduced together with the reserves. Balance in the Profit and loss account of the Transferor company i.s to be set off against the investments an reflected in the books of account of the Transferor company while the debt if any, to he adjusted against the reserves of the Transferee company.
15. All the employees of the. Transferor company in service on the effective date., shall become the employees of the transferee. company on such date withort any break or interruption in service and on the ten as and cenditions not less favourable than those subsisting with the. transferor company. No e mployee of the Transferor Company has appeared befr're the court to oppose the Scheme of Amalgamation, ExhibitE". Thus, the interest of the employees is taken care of.
; N 10
16. Or. a perusal of th.e iapiv of. the. Regional Direeter for Company Affairs, the following two questions arise for decision making in ffmi pelition:
I) Whether sanction of a scheme of amalgam ation of the Transferor Company, a subsidi ary of the Transfe:.ree C:ompanv. a body corporate, under the Banking Ccmpsnies Ae.quisibon Act, is permissible under Sr cOlon 39 1 to 391 of the Companies Act, 1956?
11) Whether the. Transferee company, a bod a corporate is required to file. se parate e.titious ranier Section 39 1 to 394 of the. Act for sanc.Iion of the sche.me of nuaigan ition?
.5. Vijaya. Bank is a Pan.king c.ompany as defined in the Banking Coiuparde.s Regalialion Act, I 949 and a holy corporate under the Banking Compan ies Acquisiticai. Act..
The toni 'Hod corporate' is d.ehned u.ude.r Section 2(7) of the Act which reads thus:
11
"Body corporate" or aroIrationn includes a company incorporated outside India but does not include--
a) a corporation sale;
b) a co-operative society registered under any law relathig to co-operative societies; and
c) any other body corporate (not being a company as defined in. this Ad) which tIe Central Geverement n.ay, by notification in the Official Gazette, specify in this behafy The term 'body corporate' is wider than the expression 'company' and is used in several sections of the tct to denote not only a compam incorporated. in India, but also a••• foreign company. It includes a corporation formed under any special law of India or a Ibreign country, except as expressly excluded by the definition, It includes all public financial institutions mentioned in section 4-A as well as the nafionalised banks incorporated under section 3(4) of the Banking Companies Acquisition and Transfer of Undertakings Act, t970. However it excludes a Body corporate, which is not a company under the Act, and which is specified by th.e Cr. ntral Govemment i.. the notification in the official gazette in othe.r words, it melnde.s a body corporate other than which Central Government my by notification in th..e official. gazette specify.
s Vijaya. Bank squarely fails within the aforesaid definition of the term body corporate.
17. The terms 'Holding company' and subsidiar are defined in Section 4 of the Act, which reads as follows:
"4. Meaning of 'holdi.g company' and subsidiaryu (I) Fcir the purposes of this Act, a company shall, subject to the provisions of suta section (3), he deemed to be a subsidiary of another if, but. onir ff
-1
(s) that other contrels the composition of its Board of directors; or
(b) that other-
(i) where the first mentioned company is an existing company in respect of which the holders of preference shares issued before the commencement of this Act have the same voting rihts in all respects as the holders of equity shares, exercises or controls more.
than half of the total voting power of such c.ompany;
t:ii) where the ti.rstnnentioncu company rs any other company, hokis more than hart rn. nominal value of its equity share capital; or
(c) the finthmcntioncd corn panv is a subsidiary: of ary company which is that other's subsidiary."
T if fS 113 4is h ('onpnAi d in I he
01 3 1 (onpan B if )fl f he folbAing dit r
I piied 1
t
lj mpanB Ithmmnlecfsnnii A ii
01 th conpo i f I lid
Due ton
C rai lb Idsmo lb he fth C U)
A' It -
Inncnn e,
1 r
Con Co A is suns dia f a uhsid in
3
a miPr ) ja sdfn as i
hidg tan r mpn 10 01
I I lion t silnlai
I
1 i a ) I tel
A 1 1 1
i ( pa
1ff' I q sh Ti s
pro i I ctg
1 + + 4
14
euuitv shares issued by the Transferor company being held liv the Transferee company, it could be satelv concluded that the Transferor company is the subsidiary of the Transfrree company which is its holding company. In view of sub section (4), the Transferor being the subsidiary of the other company, the Transferee company is deemed to be a holding company Sub-section (5) provides that the expression 'Company' in the said section includes any body corporate. Thus, under this clause the tenn 'Compan.v' under t••he Act h eludes any 'body corporate'.
(Emphasis suppbed) Section 394 of the Act reads thus:
if Previsions for facilitating reconstruction and amalganation of companies:- (1) Where. an apphcation is made to the Court under Section 391 lur the sanctioning of a o.mpromise or arrangement proposed between a company and.
any such persons as air mentioned in that section, and it is shown to the Court-
(a) that the compromise or arrangement has been proposed for the purposes of, or in r S flflecti)fl is th a h xix for th reconstruction of any company or omr aiiies, or tI e amalgamation of any hvo or mow companies: and
(b) tnt under the scheme the is hole or aix part cf the undertakmg proper or liabilities ot [my coinpani concerned m the scheme (in it is section referred to as tnmsferor company") is to be translerred o nothc oinpan in this sectioi referred to as the Ctransferee company"):
tue ourt may, either In the order sarietionrng th e inpn ise or arnngement or hi a subsequent order, make provisions for all or any cfthe llwi gm tters U) ht hal sfer t( tIn tiansteree c anpan the whole or any part of the undertaking, pin at f ibil ix f ny tr' nstero comparn.
u) ,e aiotm nt or appr pr nion oy the transfrree rcmpani of an shares cli it rca, policies, or o ,hei like interests xi that company svhic h, sn der the mpromise or trrangc ment, art to he '4 0 lb allotted or appropnated by that corn.pax.y to or fOr any person;
(iii) the continuation by or again.st the
hasinree company of an ]egai
proceedings pending by or against any transferor cornpany;
(iv) the dissolution, without winding up, of any trrn sferor cornpany;
(v) the provision to be rnade for an y persons who, within such tine and in such rn.anner as the court din.cts , dissent frorn the cornprornise or a*angernc.nt ; and
(vi) such hcdentai, consequential and supplernental. rnatters as axe necessary to secure that the reconstruction or arnalgarnahon shall be fully and effectively carried out:
Prcvided that no cornprornse or arrangernent proposed for the purposes ol, or in connection wit]., a scherne for the anudgaination of a cornpany, which is being worrnd up, with any other cornpany or cornpanies, shall be sax cloned by the court unless the court has received a report frorn the Cornpany Law Board or th.e Registrar that the afilairs of the company have not been conduc ted in a manner prejudicial to the interests of its members or to p uhlic interest:
Provided farther that no order for the dissolution of any transferor company under Clause (iv) shall be made by the court unless the Official Liquidator Las, no scrutiny of the hooks and papers of the company, made a report to the court tht the affairs of the company have not been conducted in a manner prejudicial to the interests of its members or to public irterest.
(2.) where an order under this section provides for the 1tra s lcrr of any property or liabilities, then, by virtue of the order, that property shall be transferred to and vest in, and those liabilities shall be translbrred to and become the bahilitics of, the transferee company; and in the case of any property, if the on. er so directs, freed from any .charge which, is, by virtue of the compromise or arrangement, to cease to have eflbct (3) thirty days after the making of an Within order under this section, every company in relation to which the order is made shall cause a ill 18 certified copy thereof to be flied with the Registrar for registratiom.
If default s made in eompiying wit!. this sub section, the company, and every officer of the company who is in default, shall be punishable with. fine which may eic tend to. fifty rupees.
(4) in this section -
(a) propertv' includes property, tights and
powers of every: description: and 'liabilities' includes duties of every description; and
(b) 'trrmsferee company' does not inchrde any company othc:r than a company within the me:aning of this Act;. but 'transferor company' includes any body corporate, whether a company within the tneaning of this Act or not"
A bare reading of the said provisions in conjunction. with Sections 39 I to 393 in Chapter-V of the Act ]eaves no room for rjoubt that the Legislature invested in the Court powers or wide amplitude navmg regard to arbitration, re construction, compromise and arrangement enterec into between companies, for any purpose conducive to the $;i U\ thiler, while interest of the shareholders, without an cmc, iccoidmg saw lion to th seh ot a sc heme of 19 In fbi case of sanction panies, what is c ssential is a amalgamation between two com n nsferee company. Sub st elto Transferor compan and a Tra defines 1 ransferec ccmpanv as 1(b) of Section 3°4 of the Act a a nu ii ic p od m ofl erh t m r 1 il niato iim ae do uinde pany to meinde any body Act while the I ransfernr com within thc meaning of the Act corporate, whether a company impression that the r not At first blush, one gets the mt Indes a tort ign ctnnpany definition of I ransleror compan inition of the body corporate in and when read with the def purpose of the Section is to Section 2(7) of the Act, the i toreign eomp'mx and an 'nable the compromise beth cc n e compa Nevertheless the Indiar eompan', the fransfere ' hides anb compan' w thin flit tenn Transfert e comparr inc n l xam r ati )n f the dc finitio meaning of the Act, A cairfit lion (7) of Section 2, reveals of Lod corporate nude s ins e mpan,' cinch takes intl its that, t is wider h n i Ic. m under anv , c corpnr#te nusu1ii1td fehti ani fcreigu eampart V 4 20 special law of India and the hcxlv corporate. a company defined under the Act, while excluding a Corporation or a Craoperafive Society. MIs. Vijaya Bank, a body corporate constituted under the Banking -ompanies Acpnsition Act is the holding compaay jpthp . ses, of this Act, as defined in Section 4 of the Act, in respect of the petitionencompanv, the snbsidiarv company. Hence, it is not difficult to hold that Vijaya Bank, though a body co:rate is a eompany for the purpose of the Act. If that be so, then Vijava Bank is the Tran •fcree company for the purpose of Section 394 of the Act. (emphasis supplied)
20. The leaned Senior cone sd Sri. Udaya Holla would make reference to the decision of the High Court of Andhra Pradesh in the case of Andhra Bank Housing Finance Limited (SEBI and Corporate Lawsuleports), which, too, was a case of a scheduled Bank, a body corpo rate and a company under the Banking Companies .
Acquisition Act, a Transferee company seeking to take over its sub sidiarv M/ s. Audhra Bank Housing Finance Limited, re(AP) (200Y)47 SCL 5.13;
W C 21 the It 'ransfbror flr'nI15-inV wiiicii. was toe. petrtioirer in the C.ompar iv petition. In identical circumstances, the And.hra Pradesl. High Court held that, under Section 4() of the Act, the e.xpression 'company' includes a body corporate aid therefore, the Batik which is a body corporate and a holding c.onpany fell within the expression tompany' for the purpose. of the Act. Hence, Point No41) j ti swereU. in the afbnna tree Sri. Udava Holla, Icarned Senior Counsel contends that M/s. Vijaxa Bank, the Tran.siEiee Company being a 1.00% b,oiding company wherein all the shareholde.rs or the shareholders of its subsidiary the Transferor comuanv b.aving consented to the scheme of amalgamation, the c;ontract between two coin.pames. there is no need tbr a setiarate petition to seek the irnprirnatnr of this Court to the sc.hex,ne 01 analgimmnatlore Amplrlying the sari con.tentmon, Sri U dam.: I-I ella points out to the report Exhibit to' in the Chairman of the meeting of the shareholders ol ttie C"
\ S Transfrror company, nont oth er than tile members of tile trrnisfcit '.cmpau cc nvcnrci 1) consid er the scheme of c m&ganahor' t pursuau to 1hz dirttion (I this Court in C. A,No 7( 1/2004 whenc e all the members who attendc d the meting unanimously -ipprov ed the scheme and agreed th -it up n the s theme bee ming efih etive, the share capital af the Transferor company isould sta nd automatically cancelled and no shares hi the Transft roe company icould 1w alIenee to them, Further that in terms of the scheme file cieditors of the Trai sferor c ompans wou l 1 no he altec tc I since the Transferee c u pal \ s (Cl 51 i pitt makms c mpan ha m g an cxc c as of assets )ver hablinc to 11 r exter t of Rs , 89 r ) ('ion s cc brie tat liansthrci ot; pain- has an exec s f a' sets ci liabilities tc he extent of Rs 18 72 a Sri Ih ila rcbcs upon the dec isLori ot tin Bomha' I ria (c or in tire ase of Ma haamba Investments Ltd. Vs. ID! 2Limited waiL at tlc same tun e, sceking to distmgutsh n in -t lit 1 cision of tins Court ni the case of Kirloskar Electric Company Limited.
JQ1 \Si inc t5nprrc;r.zz
Pg it
OO1 1' 3Cc rrp'n aces Pg
21 The factual matrix noticed supra demonstrates
that the petitioner the Transferor company is sought to be merged with M/ . Vijaya Bank, the Transferee companv That the Transferor co]..pany is a subsidiary of the Transferee com.pany, the Holding Company by now is well established. Clause I I of the scheme of amalgamation Exbibiti" E" provides that on the scheme becoming effecting, the said share c:apital of the Transferor company automatically stands cancelled and no shares will be allotted to any of the shareholders of the Transferor compau as the Transferee company holds all the sharys issued by the Transferor company. The scheme is not likely to affect the interest of the creditors of the Transferor company in view of the fmanclal position of the Transferee company, The scheme Exinbitali" does not involve reorganisation of the share capital of the Transferee company.
22. Keeping in mind th.e est.hlished facts, I proceed to examine the decision... of this Court in Kirioskar's case supra. Certain essential facts must Ire first noticed. M/ s Kirloskar Electric Company filed a petition under Section 391 to 394 of 2.4 the Act seeking sanction of th..e scheme of arrangement whereunder some of the divisions/undertakings of the petitioner Company were sought to be hived ott and transferred in favour of K.T. Switch Gear Private Limited and M/ s. Pest Trathng Agencies Limited, which Transferee companies did not tile petitions before the Court. However, on the objections taken by the Regional Director of Company Affairs, the said two Transferee companies sought to come on record h filing applications under Rule 9 of the Company Court Rules, 1959. in addition, secured creditors as well as the employees association objected to the sanction of the scheme of arrangement. This Court, having tirken uote of the. material terms of the scheme, held that prima facie the real purpose was to tmnsic.r primanr and valuable assets of the company which inchided the entire movable properties of the company to the Transferee companies which are said to be paper companies without paving Che stamp duty and that it was not in public interest Having found that the petitioner-company therein had followed the formalities, the learned Judge proceeded to answer the question as to 25 whether a similar requirement is necessary qua the shareholders of the Tran sinree company. Having thoroughly semmed and examined the scope and object of Sections 391 to 394 of the Act His Lordship H. L, Dattu was of the view that the application nnder Suinsections (ii) and (in) of Clause
(b) of Section 394 of the Act referable to the Transferee companies, were rcqnired to petition the con pany by making an application under Section 391 of the Act and thereafter a petition under Section 394. The observations, in the very words of His lordship is thus:
"In view of the above, it can safely be said that both the transferor and transferee company should make either a joint petition or separate petition as envisaged under section 394 of the Companies Act. Sninclanse (v) of the section is equally applicable to the tianslbror and the transferee company, for it cannot be the position that it is on the shnrehoiders of the transferor company, who can dissent. The general powers contained in clause (vi) may require application both. in the case of transferor company and the transferee company. if an arrangement is s inc'toned and directions air given tinder cimises (I) and (iii of scetion 394 ot the Act, on a petition filed by the transferor company, then the orders so made by the court may not bind thc transfei cc company, its members and creditors and the sanic nould lead to inc ongi a )U5 situation In my view, the vanous sub Inns s of section 3( 4 of the Act, confirm th view that both the traustcror 'intl the transferee c umpanv should make an application rnder secttons 391 to 394 of the Act before the scheme of arranpenicnt is sanctioned.
Fticrctorc, mere tiling ot apphcation under rule 9 of the ('ompamcs (Comt) Rules by the transferee c ompan cs cold not satish the rcqmrc ment ii in Icr section 391 to 394 of the Act. I heretorc, n an p n cm h of the comp nit's for the , sc hc in of mn ngcmcnt must 'omplv with the ic p nraents ot st --ton 391(1; of the Act hr ohtainmg directions, inter ann for holdmg the ncciing of ttic shareholders mid creditors of the C\lmpanit 5, To s'ini tip, this petition is onh hr the transferor compan and the piaycr made in the is to sanction the scheme of p if ion i -t ingcu'crt c a, t 5 a' all memh an,
3 b bind u secured creditors unsecured creditors of d.c petitionercom.pany, as well as on the petitioner- company and that by true construction of sections 391 to 394 of the Companies Act, the transferee company should also join in this petition and their should be meeting of the shareholders of the transferee company after obtaining dirt etions from this Court for convening the meeting as well as approving the scheme of arrangement. Sir cc the assets and liabilities of the petilioner-coinpany .will be trausferTed to the transferee companies under the scheme of arrangement the sharebolding and other rights of the transferee companies would he affected and it is going to change the capitirl structure of the transferee eompaniesJ
23. The question as to whether a joint petition or a separate petition as envisaged under Section 394 of the Act is required to be filed by both the Transferor and Transferee companies fell for consideration in the ease of Electro Carbon Private Limited 4 wherein a learned Single Judge of re(KARI i99 Vol.19 Pg825 I is onit held th t pmt p tthon is impenrussible and that a eparate petit as air rqtnred to b fd-d It appears that this judgment was not brought to the notice of His lordship ILL. Dattn, J.. and therefore, His Lordship held that it could he either a joint petition or a separate petition. 01 rae this is at noticed is it may have no h sung on tae c nclusions at this petiti n 2t 'I here is considerable force in the snbmissxn I the learned Senior counsel that the jndgement in kirloskar's is rIr'tingnishable on facts, since that was not a case of albamation f i snhsidi in company with its hold ng c rp at. c h kìmg Cot pa tbemg h tolderof lOaoot aba a of its hsidian' )mpc n in the m etnig f tl sh rcholdets of the 'I ransleror compant convened as directed in thts Court under Section 391 of the Act, the i'erv same shareholarrs of the Transferee compam havmg pa pated m h said ira fl , nd appro e die scher o a Igat aIr n -a not d taat I neci at not hi I e Tr tie 'ornpctr i mt-rn' ad ere t Tb Board c I La rIots of tin transferee ampant at 11w '0 meeting held approved and adopted the scheme of amalgamatro x LxInbit °'L Ih Reserve Bank of India permitted the I ransferee company to enter into a contract to take over its subsidian. 1 he scheme of transfer does not ffc t thc nghts c f the mcmlxi's or reurtors )f 11 e Transferee company as beta ecu themselves and the conipanv. No new shares are issued, there bemg no rorg nisation of the shai c apnal of the I ransferor company In these circnmslances, I am of the considered opinion, that there is no nt ed for the Transteree compain to lilt in ah 1c hon and a petth a i rd Stctxon 391 to 3Y' ot tli Ac 2% fo the r as ns aft ed supra the petiti mci' has made out a case foi acronling sanction of this Court to the sciem of ax algainitxc n l'xh hi l, lie ii , the foilowi ig ml a he sch in d amxigxm tar lxh'bit IC proposed by thc I ransleror Company is ntin al aid t Inc g cx the r sI rn Canrj'ny tu hare i Id rs r duo
n) 1 xi Itnu ( mpiny sh'ill stand I s cdnifl u thueb uganorderol urdu ip (i ) T s dirt. n I di 1% rq dccrec flu F rmNo4 u I e Fr ii Irtor ( omin t dinx tur to scr j ) thus order on the I'Zcg six n I Conpamc in Kna'ka nrthm 30 I KS