IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY SCHEME PETITION NO. 665 OF 2010. CONNECTED WITH COMPANY SUMMONS FOR DIRECTION NO. 684 OF 2010 WMI CRANES LIMITED …………Petitioner / Transferor Company. AND COMPANY SCHEME PETITION NO. 666 OF 2010. CONNECTED WITH COMPANY SUMMONS FOR DIRECTION NO. 685 OF 2010 WMI REAL ESTATE DEVELOPERS PRIVATE LIMITED …………Petitioner / Transferee Company. In the matter of the Companies Act 1 of 1956; AND In the matter of Sections 391 to 394 of the Companies Act, 1956; AND In the matter of Scheme of Arrangement between WMI Cranes Limited (the Demerged Company) and WMI Real Estate Developers Private Limited (Resulting Company) and their respective shareholders and creditors Mr. Virag V. Tulzapurkar Sr. counsel with Ms. Alpana Ghone and Mr. Rajesh Shah i/b Trilegal., Advocate for the Petitioners. Mr. C. J. Joy i/b Mr. H. P. Chaturvadi for Regional Director in both Petitions. Miss. Tasneem Zariwala i/b Intralegal for ING Vysya Bank, the intervener 1 CORAM: S. C. Dharmadhikari, J. DATE: 21st January, 2011. PC: 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 the Scheme of Amalgamation of WMI CRANES LIMITED, the Demerged Company and WMI REAL ESTATE DEVELOPERS PRIVATE LIMITED, the Petitioner / Resulting Company and their respective shareholders and creditors. 3. Counsel appearing on behalf of the Petitioners states that they have complied with all requirements as per directions of this Court and they have filed necessary affidavits of compliance in the Court. Moreover, Petitioner Companies undertake to comply with all statutory requirements, if any, as required under the Companies Act, 1956 and the Rules made thereunder. The undertaking is accepted. 4. The Regional Director has filed an Affidavit stating therein that save and except as stated in para 6(a), (b) and (c) of the Affidavit the Scheme does not appear to be prejudicial to the 2 interest of shareholders and public. The Paragraph 6 of the said Affidavit is read thus:- “ 6. That the Deponent further submits that:- (a) Clause No. 8.1 of the Scheme, refers to the Consent Terms arrived in Suit No. 1247 of 2006 between the Demerged Company/ Resulting Company and M/s. Ashford Estates (Plaintiff) which form part of this scheme. However, the same was not annexed/ in- corporated in the scheme. In this connection, it is suggested that the said terms and conditions shall be part of the present scheme of arrangement here- in. (b) Clause 3.3 of the scheme states that WMI will re- move its plant and machinery together with its em- ployees to its plant at Jejuri, Pune or discharge or retrench its workmen or given voluntary retirement under Voluntary Retirement Scheme at the cost of WMI without any delay or default. In this connection it is suggested that the Demerged Company should give an undertaking to safeguard the interest of workers engaged in the Specified Assets being De- merged. (c) The scheme provides for transfer/ demerger of only Specified Assets of the Demerged Company to the Resulting Company. Though the resulting company is having mirror image of shareholding pattern of Demerged Company, it is not a subsidiary of the De- merged Company. Hence it is suggested that any tax liability arising out of this transfer of property shall be met by the Demerged Company and the De- merged Company shall give an undertaking to that effect.” 5. N.L. Narasimhan, Authorised Signatory of the Transferee Compa- ny has filed his affidavit dated 22nd December, 2010 in Company Scheme Petition No. 666 of 2010 in reply to the observation made by the Regional Director in his Affidavit. With reference to paragraph 6(a) of the affidavit of Regional Director is concerned, 3 it is stated that the Consent Terms were arrived in Suit No. 1247 of 2006 inter alia between the Demerged Company/Resulting Company and M/s Ashford Estates (Plaintiff) and the said Con- sent Terms were filed in the said Suit and were taken on record by the registry subsequent to the date of filing of the Scheme of Arrangement. It is pertinent to note that the Demerged Compa- ny and Resulting Company have common shareholders and they are also parties to the said Consent Terms. As such, all parties to the Consent Terms are aware of the terms stated in the said Consent Terms. Moreover, none of the creditors or shareholders have objected to the Scheme of Arrangement. In the circum- stances the objection of the Regional Director as contained in Para 6(a) of his Affidavit does not survive as by clause 8.1 of the scheme, the consent terms are made part and parcel of the scheme. 6. The counsel appearing on behalf of the Demerged Company ten- der an affidavit of N.L. Narasimhan, Authorised Signatory in re- ply to Regional Director Report. With reference to paragraph 6(b) of the affidavit of Regional Director is concerned, it is stated that the Demerged Company undertakes safeguard the interests of the workers engaged in the Specified Asset being Demerged and With reference to paragraph 6(c) of the affidavit of Regional Director is concerned, it in stated that the Demerged Company 4 undertakes to bear tax, if any, arising out of the demerger of the Specified Asset. The undertaking are accepted. 7. There is an affidavit filed by the Secured Creditor (ING Vysya Bank Ltd.) of the Demerged Company, inter alia, prays that all the obligations and liabilities of Demerged Company / Pe- titioner Company as well as the mortgage subsisting on the Schedule A Property in favour of ING Vysya Bank Ltd. to be protected. 8. The counsel appearing on behalf of the Demerged Company ten- der an affidavit of N.L. Narasimhan, Authorised Signatory in re- ply to Affidavit of said Secured Creditor, it is stated that the paragraph 3.6 and 8 of the Scheme specifically protected the interest of said creditors. In view of the above, the coun- sel appearing on behalf of the Secured Creditor does not have any objection to the Scheme being sanctioned. 9. 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. 10. Since all the requisite statutory compliances have been fulfilled, Company Scheme Petitions are made absolute in terms of prayer clauses (a) to (c). 5 11.The Petitioner Company 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 the order. 12.The Petitioner Companies in both Petitions to pay costs of Rs.10,000/- each to the Regional Director, Western Region, Mumbai. Costs to be paid within four weeks from today. 13.Filing and issuance of the drawn up order is dispensed with. 14. All concerned authorities to act on a copy of this order along with the Scheme duly authenticated by the Company Registrar, High Court, Bombay. (S. C. Dharmadhikari, J.) 6