COMP/55/2008 1/7 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD COMPANY PETITION No. 55 of 2008 For Approval and Signature: HONOURABLE MR.JUSTICE K.A.PUJ Sd/- ==================================== 1. Whether Reporters of Local Papers may be allowed to see the judgment ? YES 2. To be referred to the Reporter or not ? NO 3. Whether their Lordships wish to see the fair copy of the judgment ? NO 4. Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? NO 5. Whether it is to be circulated to the civil judge ? NO ==================================== BANNER PHARMACAPS PVT. LTD - Petitioner Versus . - Respondent ==================================== Appearance : MRS MAUNA M BHATT for Petitioner. MR IQBAL SHAIKH, Central Government Standing Counsel. ==================================== CORAM : HONOURABLE MR.JUSTICE K.A.PUJ COMP/55/2008 2/7 JUDGMENT Date : 19/12/2008 ORAL JUDGMENT 1. The present petition is filed seeking sanction of Scheme of Amalgamation of Banner Pharmacaps Private Limited with Universal Medicare Private Limited. 2. At the outset, it is submitted that Banner Pharmacaps Private Limited filed Company Application No.409 of 2007 seeking dispensation of the meeting of shareholders and Secured Creditors and holding meeting of Unsecured Creditors. The consent of shareholders and secured creditors have been obtained and produced on record. 3. This Court vide order dated 25.10.2007 dispensed with the meeting of the shareholders and Secured Creditors of the petitioner Company and directed to convene the meeting of Unsecured Creditors of the petitioner Company. It is submitted that pursuant to the order dated 25.10.2007 passed in Company Application No.409 of 2007, meeting of the Unsecured Creditors of COMP/55/2008 3/7 JUDGMENT the Company was convened on 20.12.2007 to consider the proposed Scheme. After due deliberations, the Scheme has been approved unanimously by the Unsecured Creditors present and voting at the meeting. The Chairman's report dated 20.12.2007 confirming the Scheme is placed on record and thereafter, the present petition is moved seeking sanction of the Scheme of Amalgamation of the petitioner Company with Universal Medicare Private Limited. 4. The Court vide order dated 21.02.2008 admitted the petition and directed issuance of notice to the Regional Director. This Court also directed publication of notice of petition in Gujarati Daily “Sandesh” - Surat Edition and English Daily “Indian Express” Vadodara Edition. Publication of advertisement of the petition in the Government Gazette was dispensed with. This Court has also issued notice to the Official Liquidator with a direction to appoint Chartered Accountant for preparation and submission of the report at the cost of the petitioner. COMP/55/2008 4/7 JUDGMENT 5. Pursuant to the said order, the petitioner published the notice of petition in Gujarati Daily “Sandesh” - Surat Edition and English Daily “Indian Express” - Vadodara edition. The authorized Officer of the petitioner Company has filed the affidavit in support of publication of advertisements dated 14.03.2008. 6. In response to the notice to the Official Liquidator, report dated 13.05.2008 is filed by the office of Official Liquidator stating therein that the affairs of the Company has not been conducted in a manner prejudicial to the interest of its members or to the public at large. 7. In response to the notice to the Regional Director, Western Region, Department of Company Affairs, Shri Iqbal Shaikh, learned Central Government Standing Counsel has appeared and has filed an affidavit of Shri R. K. Dalmia, Dy. Registrar of Companies. Along with the affidavit, a letter addressed by the Regional Director to the Registrar of Companies has been COMP/55/2008 5/7 JUDGMENT produced. A perusal of this affidavit would disclose that there are three observations made by the office of the Regional Director. The first observation is regarding furnishing latest financial statements. The petitioner has produced on record copy of the financial statement of the petitioner as at 31.03.2008 as well as 30.04.2008. The second observation pertains to the outstanding dues as on 31.03.2006 against Sales-tax to the tune of Rs.27.30 Lacs as reported in Auditor's report dated 31.08.2006. It is stated on behalf of the petitioner in the affidavit filed on 25.07.2008 that the petitioner has subsequently cleared the dues and as on date, there is no other due outstanding. This fact can also be ascertained from the financial statement produced by the petitioner. The third observation pertains to the observation made by the Auditor in his report dated 31.08.2006. In paragraph 4 of the said report, it is stated about fraud defalcation perpetrated by ex-employee and special Audit under Section 142 (2A) of the Income Tax Act, 1961. Further in paragraph 4 (b), it is stated that balances of loans and advances, debtors and creditors are subject to COMP/55/2008 6/7 JUDGMENT confirmation / reconciliation. It is stated by the petitioner that the group Company has filed FIR with the Additional Commissioner of Police, CID, Mumbai. In respect of paragraph 4 (b), it is submitted that while finalizing the audited accounts for 31.03.2008, the auditors of the Company will be required to verify the actual balances of loans and advances, debtors and creditors. There are no other observations and the explanation given to the above referred three observations are found to be satisfactorily explained by the petitioner. 8. Considering the entire facts and circumstances of the case, the Court is of the view that the Scheme is not prejudicial to the interest of its shareholders and creditors nor it is contrary to the public interest. The present Scheme of Amalgamation is hereby sanctioned and prayers made in paragraph 31 of the petition are hereby granted. 9. The cost of Central Government Counsel is quantified at Rs.3,500/-. Liberty is given to the Company to pay COMP/55/2008 7/7 JUDGMENT the amount of cost directly by drawing a cheque in favour of Mr. Iqbal Shaikh, learned Central Government Standing Counsel. 10.The petition is accordingly disposed of. Sd/- [K. A. PUJ, J.] Savariya