~ 1 ~ IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY PETITION NO 521 OF 2009 CONNECTED WITH COMPANY APPLICATION NO 385 OF 2009 Zenith Birla (India) Limited.....Petitioner COMPANY PETITION NO 522 OF 2009 CONNECTED WITH COMPANY APPLICATION NO 386 OF 2009 Tungabhadra Holdings Private Limited....Petitioner AND COMPANY PETITION NO 523 OF 2009 CONNECTED WITH COMPANY APPLICATION NO 387 OF 2009 Birla Precision Technologies Limited....Petitioner In the matter of Section 391 to 394 of the Companies Act, 1956 And In the matter of Scheme of Arrangement between Zenith Birla (India) Limited and Birla Precision Technologies Limited and Tungabhadra Holdings Private Limited and their Respective Shareholders Mr. Hemant Sethi i/b Hemant Sethi & Co. for the Petitioners. Mr. P. Rama Rao, Official Liquidator in CP No. 522 of 2009 Mr. C..J Joy with S.C Pal i/b Mr. S. K. Mohapatra for Regional Director in all the petitions ~ 2 ~ CORAM: S.J KATHAWALLA J DATE: 8TH JANUARY 2010 1. Heard learned counsel for the parties. 2. The sanction of the Court is sought under Sections 391 to 394 of the Companies Act, 1956 to a Scheme of Arrangement between Zenith Birla (India) Limited and Birla Precision Technologies Limited and Tungabhadra Holdings Private Limited and their Respective Shareholders. 3. Counsel appearing on behalf of the Petitioners has stated that the Petitioners have complied with all requirements as per directions of this Court and they have filed necessary affidavits of compliance in the Court. Moreover, Petitioners undertake to comply with all statutory requirements, if any, as required under the Companies Act, 1956 and the rules made there under. Undertaking is accepted. 4. The Regional Director has filed an affidavit and has stated in paragraph 6(a) that for the financial year 2005-06, 2006-07 & 2007-08, of the Demerged Company, there is a prima facie violation of Section 297 of the Act by the Demerged Company in respect of its transactions with M/s Viking Travels Private Limited, a private limited company in which Shri Yashovardan Birla, one of the Director of the Demerged Company is also a Director in the said private limited company. The Petitioner Company has accepted the above said violation in the statement furnished before the deponent and undertakes to apply to the appropriate authority for compounding of the said violations under section 621A of the Companies Act, 1956. The Registrar of Companies/Regional Director, Western Region has been directed to initiate necessary penal action against the Demerged Company and its Directors in this regard. The learned counsel for the Petitioner states that the Demerged Company has given ~ 3 ~ undertaking for filing of necessary application for compounding the said violations under sections 621A of the Companies act, 1956 which is recorded in the affidavit of the Regional Director . 5. It is further stated in para 6(b) of the affidavit that as per the Balance Sheet for the financial year 2005-06, 2006-07 & 2007-08, of the Resulting Company, there is a prima facie violation of section 297 of the Act by the Resulting Company in respect of its transactions with M/s Viking Travels Private Limited, a private limited company in which Shri Yashovardan Birla one of the Director of the Resulting Company is also a Director in the said private limited company. The Petitioner Company has accepted the above said violation in the statement furnished before the deponent and undertakes to apply to the appropriate authority for compounding of the said violations under section 621 A of the Companies Act, 1956. The Registrar of Companies, Mumbai /Regional Director, Western Region, has been directed to initiate necessary penal action against the Resulting Company and its Directors in this regard. The learned counsel for the Petitioner states that the Resulting Company has given undertaking for filing of necessary application for compounding the said violations under sections 621A of the Companies act, 1956 which is recorded in the affidavit of the Regional Director . 6. Save as aforesaid, the Scheme does not appear to be prejudicial to the interest of shareholders and public. 7. From the material on record, the Scheme appears to be fair and reasonable and is not violative of any provisions of law and is not contrary to public policy. None of the parties concerned have come forward to oppose the Scheme. 8. Since all the requisite statutory compliances have been fulfilled, the Company Petition Nos. 521 of 2009, 522 of 2009 and 523 of 2009 are made absolute in terms of prayer ~ 4 ~ clauses (a). So far as the violation of Section 297 of the Companies Act, 1956, by the Demerged and Resulting Company are concerned, the Registrar of Companies, Mumbai/Regional Director, Western Region, are at liberty to take appropriate action pursuant to the Companies Act, 1956 against the Demerged and Resulting Companies. 9. The Petitioner Companies to lodge a copy of this order and the Scheme duly authenticated by the Company Registrar, High Court (O. S.), Bombay with the concerned Superintendent of Stamps for the purpose of adjudication of stamp duty payable, if any, on the same within 60 days from the date of order. 10. The Petitioners in all the Petitions to pay cost of Rs.7500/- each to the Regional Director. Petitioners in Company Petition Nos. 522 of 2009 to pay cost of Rs. 7500/- to the Official Liquidator. Costs to be paid within 4 weeks from today. Petitioner to comply with statutory compliances, applicable, if any. 11. Filing and issuance of the drawn up order is dispensed with. 12. All authorities concerned to act on a copy of this order along with Scheme duly authenticated by the Company Registrar, High Court (O. S.), Bombay (S.J. KATHAWALLA J)