Full Judgment Text
* IN THE HIGH COURT OF DELHI AT NEW DELHI
COMPANY JURISDICTION
+ CP No. 266 of 2007
% DATED 22.01.2008
In the matter of the Companies Act, 1956:
Scheme of Amalgamation of:
Dabur Foods Ltd. ... Transferor Company/Petitioner Company no.1
A nd
Dabur India Ltd. ... Transferee Company/Petitioner Company
no.2
Through : Mr. Nidhesh Gupta,
Advocate for the applicant company
VIPIN SANGHI, J. (ORAL)
1. This is a petition under Sections 391 and 394 of the
Companies Act, 1956 seeking sanction of the Scheme of
Amalgamation of Dabur Foods Ltd. (transferor company) and Dabur
India Ltd. (transferee company).
2. The registered office of the transferor and transferee
company are situated at Delhi within the jurisdiction of this Court.
3. The petitioner companies had filed Company
th
Application (M) No. 141/2007 which was allowed by order dated 18
September 2007. By the aforesaid order, the requirement of
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conducting statutory meetings of equity shareholders and secured
creditors of the Transferor Company and the meetings of the equity
shareholders, secured creditors and the unsecured creditors of the
Transferee Company was dispensed with, on account of consent
given by all of the above-mentioned concerned persons/entities.
4. However, the Transferor company was directed to
convene the meeting of its unsecured creditors at Punjabi Bhawan, 10
rd
Rouse Avenue, New Delhi on 3 November 2007 for the purpose of
considering and, if thought fit, approving the said Scheme of
Amalgamation. Ms Lalit Mohini Bhat, Advocate and Ms Pooja Aganpal,
Advocate were appointed as the Chairperson and the Alternate
Chairperson respectively of the said meeting of unsecured creditors
of the Transferor company.
5. The report of the appointed Chairperson of the meeting
of the unsecured creditors of the Transferor company, Ms. Lalit Mohini
th
Bhat, was filed with this Hon'ble Court on 6 November 2007. On the
basis of that report of Ms. Bhat, this Court is satisfied on the following
aspects:
a) The requisite quorum of 20 unsecured creditors
present personally or through proxy representing 15% of
the total value of the unsecured debts, as required by the
above-mentioned order, was present.
CP No. 266 of 2007 Page 2 of 8
b) The meeting was attended by 80 unsecured
creditors which totaled to Rs. 23,91,12,591/- of unsecured
debts. The votes were cast by 57 unsecured creditors of
the value of Rs. 23,54,94,464/- and representing 45.26%
of the total value of the unsecured debts. The creditors
st
cut off date was set as 31 August, 2007. The votes
of the remaining 23 unsecured creditors were declared
invalid, since they weren't creditors as on the Creditors
cut off date, and they attended the meeting on the basis
of the aforesaid advertisements in the newspapers.
c) The said scheme of amalgamation was approved
unanimously by the unsecured creditors, who were
present and voting, in the meeting. The list of such
unsecured creditors has been filed for record.
6. After the present petition was filed citations were
st
directed to be published vide order dated 21 November 2007 in “The
Statesman” (English edition) and “Jansatta” (Hindi edition), in terms
rd
of Companies (Court) Rules, 1959. An affidavit dated 3 January, 2008
has been filed by the Chairperson appointed for the meeting about
the publication of the citations in “The Statesman” (English) and
st
“Jansatta” (Hindi) on 21 December, 2007. The said publication
containing the said citations were also produced along with the
affidavit.
CP No. 266 of 2007 Page 3 of 8
7. Notices were issued to the OL and the Regional Director
st
(Northern Region) vide order dated 21 November 2007. Pursuant to
th
the notice issued to the OL, a report dated 8 January 2008 has been
filed by the Official Liquidator. The Official Liquidator sought
information from the petitioner company vide its letter no.
th
OL/TECH/AMAL/88/274 dated 12 December 2007, upon which the
requisite information was furnished by the Petitioner Companies.
8. The transferor company was incorporated on
03.12.1996. The registered office of the company is situated at 8/3,
Asaf Ali Road, New Delhi – 110002. The registered office of the
company is situated within the jurisdiction of this Court.
9. The authorised share capital of the transferor company
st
as on 31 March, 2007 was Rs. 20,00,00,000/- divided into
2,00,00,000 equity shares of Rs. 10/- each. The issued, subscribed
st
and paid up equity share capital of the Transferor company as on 31
March 2007 was Rs. 20,00,00,000/- divided into 2,00,00,000 equity
shares of Rs. 10/- each.
10. The transferee company was incorporated on
16.09.1996. The registered office of the company is situated at 8/3,
Asaf Ali Road, New Delhi – 110002. The registered office of the
company is situated within the jurisdiction of this Court.
CP No. 266 of 2007 Page 4 of 8
11. The authorised share capital of the transferee
st
company as on 31 March, 2007 is Rs. 1,25,00,00,000/- divided into
1,25,00,00,000 equity shares of Rs. 1/- each. The issued, subscribed
st
and paid-up equity share capital of the Transferee company as on 31
March 2007 was Rs. 86,28,83,808/- divided into 86,28,83,808 equity
shares of Re. 1/- each.
12. The OL has considered the report of the Chairperson of
the meeting of unsecured creditors of the Transferor company, as
st
well as the accounts of Petitioner Companies as on 31 March 2007.
The OL in its report has stated that he has not received any complaint
against the scheme of amalgamation from any person/parties
interested in the scheme in any manner and on the basis of
information submitted by the petitioner companies. Thus it was
inferred that the affairs of the Transferor company do not appear to
have been conducted in a manner prejudicial to the interest of the
members, creditors, or public interest in accordance with the
provisions of Section 394(1) of the Companies Act, 1956.
13. The report has also been filed by the Regional Director
nd
(Northern Region) by an affidavit Shri Dhan Raj, dated 2 January
2008, contending that by virtue of power delegated to him under
Section 394A of the Companies Act, 1056 he is competent to make
the affidavit. Relying on Clause 13.1 of Section D of the Scheme of
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Amalgamation, it is contended that all the employees of the
Transferor Company shall become the employees of the Transferee
Company without any break or interruption in their services upon the
sanctioning of the said Scheme of Amalgamation.
14. Relying on Para 6 of Section-C of the said Scheme,
which provides for the Accounting Treatment, the Regional Director
objected to the Scheme of Amalgamation on the ground that there
was no mention in the relied paragraph whether the Petitioner
Companies have complied with the the Accounting Standard-14
issued by the Chartered Accountants of India.
15. The objection of the Regional Director is answered by
the Petitioner Companies and an affidavit of Ms Shalu Malhotra and
Mr. Ashok Kumar Jain, Authorized Signatories of the Transferor and
th
the Transferee Company, dated 8 January 2008, in reply to the
objection taken on behalf of Regional Director, has been filed.
16. in the affidavits, it was submitted that clauses (c) to
(e) of para 6 of Section-C of the said Scheme clearly lay down that
any excess/deficit of the value of the assets over the value of the
liabilities and reserves of the Transferor company vested in the
Transferee company shall be treated in the books of the Transferee
company in accordance with “Pooling of Interests Method” as
CP No. 266 of 2007 Page 6 of 8
prescribed under Accounting for Amalgamation issued by th Institute
of Chartered Accountants of India. Clauses (c), (d) and (e) of para 6
read as follows:
“6. Accounting Treatment
(c) The Transferee Company shall record
the reserves of the Transferor Company in the
same form and at the same values as they
appear in the financial statements of the
Transferor Company at the close of business
of the day immediately preceding the
Appointed Date. The balances in the Profit
and Loss Account of the Transferor Company
shall be similarly aggregated with the
balances in Profit and Loss Account of the
Transferee Company.
(d) The excess, if any, of the value of the
assets over the value of the liabilities of the
Transferor Company vested in the Transferee
Company pursuant to this Scheme as
recorded in the books of account of the
Transferee Company shall, after adjusting the
amounts recorded in terms of Clause (c)
above and investments canceled in terms of
Clause (f) below, be treated in the balance
sheet of the Transferee Company in
accordance with “The Pooling of Interests”
method as prescribed under Accounting
Standard – 14 issued by the Institute of
Chartered Accountants of India.
(e) The deficit, if any, in the value of the
assets over the value of the liabilities of the
Transferor Company vested in the Transferee
Company pursuant to this Scheme as
recorded in the books of account of the
Transferee Company shall, after adjusting the
amounts recorded in terms of Clause (c)
above and investments canceled in terms of
Clause (f) below, be treated in the balance
sheet of the Transferee Company in
accordance with “The Pooling of Interests”
CP No. 266 of 2007 Page 7 of 8
method as prescribed under the Accounting
Standard – 14 issued by The Institute of
Chartered Accountants of India.”
17. In view of the aforesaid, the Regional Director has no
subsisting objection.
18. There is no other legal impediment to sanction of the
Scheme of Amalgamation which is annexed to the petition.
Consequently, sanction is hereby granted to the Scheme of
Amalgamation under Sections 391 and 394 of the Companies Act,
1956. the Transferee company will comply with the statutory
requirements in accordance with law. Certified copies of this order be
filed with the Registrar of Companies within five weeks. It is also
clarified that this order will not be construed as an order granting
exemption from payment of stamp duty that is payable in accordance
to law. Upon sanction becoming effective from the appointed date of
st
merger, that is 1 April 2007, the Transferor company stands
dissolved without being wound up. The OL may be paid expenses
amounting to Rs. 10,000/- within two weeks.
19. The petition is disposed of in terms of the above order.
January 22, 2008 VIPIN SANGHI, J.
ab/P.K. BABBAR
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