Full Judgment Text
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Judgment: July 06, 2012
+ COMPANY PETITION NO. 137/2012
IN THE MATTER OF:
SONY INDIA PRIVATE LIMITED …..Petitioner/Transferor
AND
SONY INDIA SOFTWARE CENTRE PRIVATE LIMITED
…..Transferee
Through: Mr. Abhisehk Seth and Mr.Rajeev
Kumar, Advocates.
CORAM:
HON'BLE MS. JUSTICE INDERMEET KAUR
INDERMEET KAUR, J. (Oral)
1 This petition has been filed under Sections 391 to 394 of the
Companies Act, 1956 (the Act) by Sony India Private Limited
(hereinafter referred to as petitioner/transferor company), in respect of a
scheme of arrangement (scheme for short) between the said petitioner
company and Sony India Software Centre Private Limited
(resulting/transferee company). As per the scheme, the „Software
Undertaking” of the transferor company is proposed to be demerged in
the transferee company.
2 The registered office of the petitioner company is situated in New
C.P. No.137/2012 Page 1 of 8
Delhi, within the jurisdiction of this Court. The registerd office of the
transferee company is situated in Karnataka High Court of Karnataka at
Bangalore has allowed the petition bearing No. 26 of 2012 filed by the
transferee company vide order dated 16.04.2012 approving the above
Scheme.
3 Details with regard to the date of incorporation of transferee
company and transferor company, their authorized, issued, subscribed
and paid up capital have been given in the petition.
4 Copies of the Memorandum of Articles of Association of the
transferee company and transferor company as well as their latest
audited annual accounts have also been placed on record.
5 Copies of the Resolutions passed by the Board of Directors of the
transferee company and transferor company approving the Scheme have
also been placed on record.
6 It has been submitted that no proceedings under Sections 235 to
251 of the Companies Act, 1956 are pending against the transferee
company and transferor company.
7 So far as the share exchange ratio is concerned, the scheme
provides that upon the scheme finally coming into effect, the transferee
C.P. No.137/2012 Page 2 of 8
company shall issue shares in the following manner:-
1,000 fully paid up equity shares of Rs.10/- each of the transferee
company shall be issued and allotted for every one equity share of
Rs.10/- each held in the transferor company.
8 The transferor company had earlier filed CA (M) 16/2012 seeking
directions of this Court for dispensation of the meetings of its
shareholders and convening the meeting of its unsecured creditors. The
transferor company had no secured creditors. Vide order dated, January
25, 2012 this Court allowed the application and dispensed with the
requirement of convening meetings of shareholders and secured
creditors and directed the convening of the separate meeting of the
unsecured creditors of the transferor company.
9 The meeting of the unsecured creditors of the transferor company
was held on March 10, 2012. As per the affidavit of Mr. Gautum
Avasthi, Chairperson appointed for the meeting of the unsecured
creditors, showing the publication and dispatch of the notices convening
the said meeting. It is apparent that the scheme of arrangement was
unanimously approved at the meeting of the unsecured creditors.
10 The transferor company thereafter filed the present petition
C.P. No.137/2012 Page 3 of 8
seeking sanction of the scheme. Vide order dated March 27, 2012 notice
in the petition was directed to be issued to the Regional Director,
Northern Region and a copy of the petition was directed to be served
upon the Registrar of Companies. Citations were also directed to be
published in Indian Express‟ (English, Delhi edition) and Dainik Jagaran
(Hindi, Delhi edition). Affidavit of service and publication has been
filed showing compliance regarding service of the petition on the
Regional Director, Northern Region and the Registrar of Companies and
also regarding publication of citations in the aforesaid newspapers on
April 23, 2012. Copies of the newspaper cuttings, in original, containing
the publications have been filed along with the affidavit of service.
11 In response to the notices issued in the petition, Mr. B.K. Bansal,
learned Regional Director, Northern Region, Ministry of Corporate
Affairs has filed his affidavit dated 12.06.2012. Relying on clause 11.1
of Part-III of Section-I of the scheme of arrangement he has stated that
all the permanent staff/employees of the transferor company engaged
with its „Software Undertaking‟ shall become the employees of the
transferee company without any break or interruption in their service
upon sanctioning of the scheme of arrangements by the Court.
C.P. No.137/2012 Page 4 of 8
12 In para No. 4 of the affidavit dated 12.06.2012, Mr. B.K. Bansal
has observed that „the petitioner company has confirmed vide its letter
that no charges are proposed to be transferred from the demerged
company/ petitioner company to the resulting company i.e. Sony India
Software Centre Pvt. Ltd.
13 In response to the aforesaid observation, it is submitted and
clarified by the petitioner that currently there are no charges registered
against the demerged company/ petitioner company with the ROC/any
authority or person and therefore the question of the transfer does not
arise at all in favour of the resulting company.
14 In para No. 5 of the affidavit dated 12.06.2012, Mr. B.K. Bansal
has observed that “para 8.3 of part II of the scheme provides that” any
excess in the value of net assets of software undertaking transferred to
the resulting company shall be applicable for distribution to the
shareholders of the resulting company. In this regard it has been
submitted by the learned Regional Director that excess, if any, in the
value of the net assets of the software undertaking should be adjusted to
the capital reserve as prescribed in AS-14 (i.e. accounting standards) and
not to the general reserve as proposed in the scheme of arrangements.”
C.P. No.137/2012 Page 5 of 8
15 In response to the aforesaid observation it is clarified that AS-14
(i.e. accounting standards issued by the Institute of Chartered
Accountants) is applicable only to amalgamations and not to demerger.
On a plain reading of the accounting standard under reference, it is clear
that the same is applicable only in case of an amalgamation and not in
case of demergers. This has also been held lby the Gujarat High Court in
the case of 2010 1 CLJ 351 tiled Gallops Realty (P) Ltd. Copy of the
order has been placed on record.
16 In view of the above said clarifications, the observations made by
the Regional Director no longer survive.
17 No objection has been received to the scheme from any other
party. Mr. Sanjay Bhargava, authorized signatory of the petitioner
company, has filed an affidavit dated July 3, 2012 confirming that the
petitioner company has not received any objection pursuant to citations
published in the newspaper.
18 In view of the approval accorded by the shareholders and
creditors of the petitioner company, representation/reports filed by the
Regional Director, and no objections received to the proposed scheme,
there appears to be no impediment to grant of sanction to the scheme.
C.P. No.137/2012 Page 6 of 8
Consequently, sanction is hereby granted to the scheme under sections
391 and 394 of the Companies Act, 1956. The petitioner company will
comply with the statutory requirements in accordance with law.
Certified copy of the order will be filed with the Registrar of Companies
within 30 days from the date of receipt of the same. In terms of the
provisions of Sections 391 and 394 of the Companies Act and in terms
of the scheme, the “software undertaking” of the transferor company
and the property, rights and powers concerning the same will be
transferred to and vest in the transferee company without any further act
or deed. Similarly in terms of the scheme, all the liabilities and duties
pertaining to the “software undertaking” of the transferor company be
transferred to the transferee company without any act or deed. It is,
however, clarified that this order will be construed as an order granting
exemption from payment of stamp duty or taxes or any other charges, if
payable in accordance with any law; or permission/compliance with any
other department which may be specifically required under any law.
19 Learned counsel for the petitioner states that the petitioner
company would voluntarily deposit a sum of Rs. 1 lac in the common
pool fund of the Official Liquidator within three weeks from today. The
C.P. No.137/2012 Page 7 of 8
statement is accepted.
20 The petition is allowed in the above terms.
INDERMEET KAUR, J
July 06, 2012
sb
C.P. No.137/2012 Page 8 of 8
% Date of Judgment: July 06, 2012
+ COMPANY PETITION NO. 137/2012
IN THE MATTER OF:
SONY INDIA PRIVATE LIMITED …..Petitioner/Transferor
AND
SONY INDIA SOFTWARE CENTRE PRIVATE LIMITED
…..Transferee
Through: Mr. Abhisehk Seth and Mr.Rajeev
Kumar, Advocates.
CORAM:
HON'BLE MS. JUSTICE INDERMEET KAUR
INDERMEET KAUR, J. (Oral)
1 This petition has been filed under Sections 391 to 394 of the
Companies Act, 1956 (the Act) by Sony India Private Limited
(hereinafter referred to as petitioner/transferor company), in respect of a
scheme of arrangement (scheme for short) between the said petitioner
company and Sony India Software Centre Private Limited
(resulting/transferee company). As per the scheme, the „Software
Undertaking” of the transferor company is proposed to be demerged in
the transferee company.
2 The registered office of the petitioner company is situated in New
C.P. No.137/2012 Page 1 of 8
Delhi, within the jurisdiction of this Court. The registerd office of the
transferee company is situated in Karnataka High Court of Karnataka at
Bangalore has allowed the petition bearing No. 26 of 2012 filed by the
transferee company vide order dated 16.04.2012 approving the above
Scheme.
3 Details with regard to the date of incorporation of transferee
company and transferor company, their authorized, issued, subscribed
and paid up capital have been given in the petition.
4 Copies of the Memorandum of Articles of Association of the
transferee company and transferor company as well as their latest
audited annual accounts have also been placed on record.
5 Copies of the Resolutions passed by the Board of Directors of the
transferee company and transferor company approving the Scheme have
also been placed on record.
6 It has been submitted that no proceedings under Sections 235 to
251 of the Companies Act, 1956 are pending against the transferee
company and transferor company.
7 So far as the share exchange ratio is concerned, the scheme
provides that upon the scheme finally coming into effect, the transferee
C.P. No.137/2012 Page 2 of 8
company shall issue shares in the following manner:-
1,000 fully paid up equity shares of Rs.10/- each of the transferee
company shall be issued and allotted for every one equity share of
Rs.10/- each held in the transferor company.
8 The transferor company had earlier filed CA (M) 16/2012 seeking
directions of this Court for dispensation of the meetings of its
shareholders and convening the meeting of its unsecured creditors. The
transferor company had no secured creditors. Vide order dated, January
25, 2012 this Court allowed the application and dispensed with the
requirement of convening meetings of shareholders and secured
creditors and directed the convening of the separate meeting of the
unsecured creditors of the transferor company.
9 The meeting of the unsecured creditors of the transferor company
was held on March 10, 2012. As per the affidavit of Mr. Gautum
Avasthi, Chairperson appointed for the meeting of the unsecured
creditors, showing the publication and dispatch of the notices convening
the said meeting. It is apparent that the scheme of arrangement was
unanimously approved at the meeting of the unsecured creditors.
10 The transferor company thereafter filed the present petition
C.P. No.137/2012 Page 3 of 8
seeking sanction of the scheme. Vide order dated March 27, 2012 notice
in the petition was directed to be issued to the Regional Director,
Northern Region and a copy of the petition was directed to be served
upon the Registrar of Companies. Citations were also directed to be
published in Indian Express‟ (English, Delhi edition) and Dainik Jagaran
(Hindi, Delhi edition). Affidavit of service and publication has been
filed showing compliance regarding service of the petition on the
Regional Director, Northern Region and the Registrar of Companies and
also regarding publication of citations in the aforesaid newspapers on
April 23, 2012. Copies of the newspaper cuttings, in original, containing
the publications have been filed along with the affidavit of service.
11 In response to the notices issued in the petition, Mr. B.K. Bansal,
learned Regional Director, Northern Region, Ministry of Corporate
Affairs has filed his affidavit dated 12.06.2012. Relying on clause 11.1
of Part-III of Section-I of the scheme of arrangement he has stated that
all the permanent staff/employees of the transferor company engaged
with its „Software Undertaking‟ shall become the employees of the
transferee company without any break or interruption in their service
upon sanctioning of the scheme of arrangements by the Court.
C.P. No.137/2012 Page 4 of 8
12 In para No. 4 of the affidavit dated 12.06.2012, Mr. B.K. Bansal
has observed that „the petitioner company has confirmed vide its letter
that no charges are proposed to be transferred from the demerged
company/ petitioner company to the resulting company i.e. Sony India
Software Centre Pvt. Ltd.
13 In response to the aforesaid observation, it is submitted and
clarified by the petitioner that currently there are no charges registered
against the demerged company/ petitioner company with the ROC/any
authority or person and therefore the question of the transfer does not
arise at all in favour of the resulting company.
14 In para No. 5 of the affidavit dated 12.06.2012, Mr. B.K. Bansal
has observed that “para 8.3 of part II of the scheme provides that” any
excess in the value of net assets of software undertaking transferred to
the resulting company shall be applicable for distribution to the
shareholders of the resulting company. In this regard it has been
submitted by the learned Regional Director that excess, if any, in the
value of the net assets of the software undertaking should be adjusted to
the capital reserve as prescribed in AS-14 (i.e. accounting standards) and
not to the general reserve as proposed in the scheme of arrangements.”
C.P. No.137/2012 Page 5 of 8
15 In response to the aforesaid observation it is clarified that AS-14
(i.e. accounting standards issued by the Institute of Chartered
Accountants) is applicable only to amalgamations and not to demerger.
On a plain reading of the accounting standard under reference, it is clear
that the same is applicable only in case of an amalgamation and not in
case of demergers. This has also been held lby the Gujarat High Court in
the case of 2010 1 CLJ 351 tiled Gallops Realty (P) Ltd. Copy of the
order has been placed on record.
16 In view of the above said clarifications, the observations made by
the Regional Director no longer survive.
17 No objection has been received to the scheme from any other
party. Mr. Sanjay Bhargava, authorized signatory of the petitioner
company, has filed an affidavit dated July 3, 2012 confirming that the
petitioner company has not received any objection pursuant to citations
published in the newspaper.
18 In view of the approval accorded by the shareholders and
creditors of the petitioner company, representation/reports filed by the
Regional Director, and no objections received to the proposed scheme,
there appears to be no impediment to grant of sanction to the scheme.
C.P. No.137/2012 Page 6 of 8
Consequently, sanction is hereby granted to the scheme under sections
391 and 394 of the Companies Act, 1956. The petitioner company will
comply with the statutory requirements in accordance with law.
Certified copy of the order will be filed with the Registrar of Companies
within 30 days from the date of receipt of the same. In terms of the
provisions of Sections 391 and 394 of the Companies Act and in terms
of the scheme, the “software undertaking” of the transferor company
and the property, rights and powers concerning the same will be
transferred to and vest in the transferee company without any further act
or deed. Similarly in terms of the scheme, all the liabilities and duties
pertaining to the “software undertaking” of the transferor company be
transferred to the transferee company without any act or deed. It is,
however, clarified that this order will be construed as an order granting
exemption from payment of stamp duty or taxes or any other charges, if
payable in accordance with any law; or permission/compliance with any
other department which may be specifically required under any law.
19 Learned counsel for the petitioner states that the petitioner
company would voluntarily deposit a sum of Rs. 1 lac in the common
pool fund of the Official Liquidator within three weeks from today. The
C.P. No.137/2012 Page 7 of 8
statement is accepted.
20 The petition is allowed in the above terms.
INDERMEET KAUR, J
July 06, 2012
sb
C.P. No.137/2012 Page 8 of 8