Full Text
CO.PET. 125/2011
IN THE MATTER OF
MIS. ORIENT ABRASIVES LIMITED
Through
Mr. K.S. Pradhan, Deputy ROC for Regional Director (NR).
HON'BLE MR. JUSTICE MANMOHAN 1.
19.09.2011 This second motion joint petition has been filed under Sections
391 & 394 of the Companies Act, 1956 (for short 'Act') seeking sanction of the Scheme of Arrangement (for short 'Scheme') between
M/s. Orient Abrasives Limited (hereinafter referred to as 'Transferor
Company') and M/s. Orient Refractories Limited (hereinafter referred to as 'Transferee Company').
ORDER
2. According to Mr. Ramesh Singh, the National Stock Exchange and the Bombay Stock Exchange have already approved the Scheme 2011:DHC:7675 by their letters dated 22nd December, 2010 and 29th December, 2010 respectively.
3. The registered offices of the Transferor and Transferee Companies are situated at New Delhi, within the jurisdiction of this Court.
4. The Transferor Company was incorporated on 1ih November, 1971 under the provisions of the Act and was issued a Certificate of Incorporation by the Registrar of Companies, Delhi.
5. The Transferee Company was incorporated on 26th November, 2010 under the provisions of the Act and was issued a Certificate of Incorporation by the Registrar of Companies, Delhi.
6. The Authorised Share Capital of the Transferor Company as on 30th September, 2010 is ~ 16,00,00,000/- (Rupees Sixteen Crores only) divided into 12,00,00,000 (Twelve Crores) Equity Shares of~ 1/- (Rupee One only) each and 4,00,000 (Four Lacs) Redeemable Cumulative Preference shares of~ 100/- (Rupees One Hundred only) each. The issued and subscribed share capital of the Transferor Company as on 30th September, 2010 is ~ 11,96,59,200 (Rupees Eleven Crores Ninety Six Lacs Thirty Nine Thousand Two Hundred) ~--~~--~- divided into 11,96,39,200 (Eleven Crores Ninety Six Lacs Fifty Nine Thousand Two Hundred only) Equity Shares of~ 11- (Rupee One only) each. The paid-up share capital of the Transferor Company as on 30th September, 2010 is ~ 11,96,52,244/- (Rupees Eleven Crores Ninety Six Lacs Fifty Two Thousand Two Hundred Forty Four only) divided into 11,96,39,200 (Eleven Crores Ninety Six Lacs Thirty Nine J Thousand Two Hundred) Equity Shares of~ 1/- (Rupee One only) each and comprising ~ 13,044/- (Rupees Thirteen Thousand and Forty Four only) being amount paid on the forfeited shares.
7. The Authorised Share Capital of the Transferee Company is ~ 12,05,00,000/- (Rupees Twelve Crores Five Lacs only) divided into 12,05,00,000 (Twelve Crores Five Lacs) Equity Shares of ~ 1/- (Rupee One only) each. The issued and subscribed share capital of the Transferee Company is ~ 5,00,000/- (Rupees Five Lacs only) divided into 5,00,000 (Five Lacs) Equity Shares of~ 1/- (Rupee One only) each.
8. Copies of the Memorandum and Articles of Association of the Transferor and Transferee Companies have been filed on record. The audited Balance Sheet as on 31st March, 2010 and unaudited balance Sheet as on 30th September, 2010 of the Transferor Company along with the report of the auditors, have been filed. The statement of assets and liabilities, as on 31st December, 2010 of the Transferee Company has also been filed.
9. A copy ofthe Scheme has been placed on record and the salient features of the Scheme have been incorporated and qetailed in the application and the accompanying affidavits. It is submitted that the Applicant Companies have the object of reorganising and segregating the Transferor Company's Refractory businesses situated at Bhiwadi from the Retained Business and vest it in a separate company, i.e., in t~e Transferee Company on the terms and conditions fully stated in the Scheme. The Scheme will result in better, efficient and ~ economical management, control and running of the businesses and further development and growth of the businesses of both the Transferor and Transferee Companies. Further, the Scheme would allow a focused strategy in operations of the Demerged Undertaking along with providing scope for independent collaboration and expansion without committing the existing organisation in its entirety and creating enhanced value for shareholders.
10. So far as the share exchange ratio is concerned, the Scheme provides that, upon this Scheme becoming effective, the Transferee Company without any further act, application, instrument or deed, issue and allot to the equity shareholders of the Transferor Company holding fully paid up shares in the Transferor Company and whose name appears in the Register of Members of the Transferor Company on the Record Date, one equity share of the nominal value of~ 1/each, credited as fully paid up in the capital of the Transferee Company, for every one equity share(s) of the nominal value of~ 1/each fully paid up held by them in the Transferor Company.
11. It has been submitted that no proceeding under Sections 235 to /'; f) 251 of the Act is pending against either the Transferor Company or Transferee Company.
12. The Board of Directors of the Transferor Company and the Transferee Company in their meetings held on 8th December, 2010 respectively have unanimously approved the proposed Scheme. Copies of the Resolutions passed at the meetings of the Board of Directors of the Transferor and Transferee Companies have been placed on record.
13. The Petitioner Companies had earlier filed CA (M) No. 3 of 2011 seeking directions of this Court to issue and publish notices and appoint chairpersons for convening separate meeting of the Equity Shareholders, Secured Creditors and Unsecured Creditors. Further, it was prayed by the Petitioner Companies to dispense with service of individual notice to Equity Shareholders holding 1000 (One Thousand only) or less equity shares of the Transferor Company and unsecured creditors holding ~ 10,000/- (Rupees Ten Thousand Only) or less amount of debt in the Transferor Company. The Transferee Company also prayed for necessary directions to dispense with the meetings of the Equity Shareholders to consider and approve the Scheme. Vide order dated 11th January, 2011, this Court allowed the application and dispensed with the requirement of convening and holding the meetings of equity shareholders of the Transferee Company and directed to convene separate meetings of the Equity Shareholders, Secured and Unsecured Creditors of the Transferor Company to consider and approve the proposed Scheme.
14. The Chairpersons of the ordered meetings of the equity shareholders, secured creditors and unsecured creditors of the Transferor Company have filed their reports stating that the meetings ·4 of the equity shareholders, secured and unsecured creditors of the Transferor Company were duly held on 26th February, 2011, as directed and the Scheme has been approved by 89.95% of total votes of the Equity Shareholders, 100% of total votes of the Secured Creditors and 97.44% of total votes of the Unsecured Creditors of the Transferor Company, present and voting, in their respective meetings.
15. The Petitioner Companies have thereafter filed the present petition seeking sanction ofthe Scheme. Vide order dated 14th March,- 2011, notice in the petition was directed to be issued to the Regional Director, Northern Region. Citations were also directed to be published in 'The Statesman' (English) and 'Veer Arjun' (Hindi) in accordance with Rule 80 of the Companies (Court) Rules, 1959. An 0~ affidavit has been filed by the Petitioner Companies showing compliance regarding publication of citations in the aforesaid newspapers on 30th March, 2011. Copies ofthe newspapers' clippings containing the publications have been filed along with the affidavit.
16. Pursuant to the notices issued, Mr. B.K. Bansal, Regional Director, Northern Region submitted in his Affidavit dated 08th April, 2011 that all the employees of the Transferor Company/Demerged Company engaged in "Refractory Business" shall become employees.. of the Transferee Company/Resulting Company without any break or interruption in their services upon sanctioning of the Scheme by the Court. He has also submitted that the Transferor Company may be advised to comply with the conditions raised by the Bombay Stock Exchange and National Stock Exchange as the shares of the Transferor Company are listed at Bombay Stock Exchange and (} · National Stock Exchange and both have given their 'No Objection' to the proposed Scheme with certain terms and conditions. An affidavit has been filed by the Petitioner Companies on 09th September, 2011 stating that there has been no objection of the Regional Director. The Petitioner Companies accordingly, undertake to comply with the applicable laws, regulations, formalities and the conditions imposed by the National Stock Exchange and Bombay Stock Exchange.
17. Further, an affidavit has been filed by the Petitioner Companies on 09th September, 2011 stating that pursuant to the filing of the notice of petition in the newspapers, the Petitioner Companies have not received any objection with respect to the advertisements regarding the petition sanctioning ofthe Scheme. l~
18. In view of the approval accorded by the Equity Shareholders, Secured Creditors and Unsecured Creditors of the Transferor Company and the Regional Director, Northern Region attached with this Court to the proposed Scheme, there appears to be no impediment to the grant of sanction to the Scheme. Consequently, sanction is hereby granted to the Scheme under Sections 391 and 394 of the Act. The Petitioner Companies will comply with the statutory requirements in accordance with law. Certified copy of the formal order 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 Act and in terms of the Scheme, the Demerged Undertaking and all the properties, rights and powers of the Transferor Company in respect of the Demerged Undertaking 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 of the Transferor Company relating to the Demerged Undertaking be transferred to the Transferee Company without any further act or deed. It is, however, clarified that this order will not be construed as an order granting exemption from payment of stamp duty or any other charges, if payable, in accordance with any law; or r-z__--· permission/compliance with any other requirement which may be specifically required under any law. Upon the sanction becoming effective from the appointed date of the Scheme, i.e. 01st April, 2011, the Refractory/Demerged Undertaking shall pursuant to the provisions of Sections 391 to 394 ofthe Act, Section 2(19AA) ofthe Income Tax Act and all other applicable provisions of applicable laws, rules and () regulations for the time being in force, without any further act or deed, stand transferred to and be vested, as a going concern into the Transferee Company.
19. Mr. Ramesh Singh states that Petitioner Companies would voluntarily deposit a sum of Rs.1,00,000/- with the Common Pool fund of the Official Liquidator within three weeks from today. The said statement is accepted.
20. The Petition is allowed in the above terms. Order dasti.
SEPTEMBER 19,2011 rn/js l\_L MANMOHXN,J \)