COMP/81/2008 1/7 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD COMPANY PETITION No. 81 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 ==================================== PARLE SALES SERVICES PRIVATE LIMITED - Petitioner Versus . - Respondent ==================================== Appearance : MR ANIP A GANDHI for Petitioner. MR HARIN P RAVAL for Respondent. ==================================== CORAM : HONOURABLE MR.JUSTICE K.A.PUJ COMP/81/2008 2/7 JUDGMENT Date : 19/12/2008 ORAL JUDGMENT 1. The present petition is filed seeking sanction of Scheme of Amalgamation of Parle Sales Services Private Limited with Parle Agro Private Limited. 2. The petitioner Company filed Company Application No.556 of 2007 seeking dispensation of the meeting of members as well as creditors of the Company for the purpose of considering and if thought fit, approving with or without modification, the Scheme of Amalgamation proposed to be made between the petitioner Company and Parle Agro Private Limited. The consent of the members and creditors have been obtained and produced on record. This Court vide order dated 07.12.2007 dispensed with the meeting of the members as well as Creditors of the Company. 3. The petitioner Company thereafter filed the present petition seeking sanction of the Scheme of Amalgamation. The Court vide order dated 11.03.2008 admitted the petition and directed issuance of notice COMP/81/2008 3/7 JUDGMENT to the Regional Director. This Court also directed publication of notice of petition in Gujarati Daily “Divya Bhaskar” and English Daily “Indian Express” both Ahmedabad Editions. Publication of advertisement of the petition in the Government Gazette was dispensed with. The Court has also ordered that the notice of hearing of the petition be served upon the Central Government as required under Section 394-A of the Companies Act, 1956 and the notice of the petition be also served upon the Official Liquidator attached to this Court as required under the proviso to Section 394 (1) of the Act, with a direction to furnish his report, preferably on or before the date of hearing, along with the report of the Chartered Accountant appointed by him out of the panel maintained at his office, the expenses of whom were to be borne by the petitioner. 4. Pursuant to the said order, the petitioner published the notice of petition in Gujarati Daily “Divya Bhaskar” and English Daily “Indian Express” both Ahmedabad editions on 05.04.2008. The authorized Officer of the COMP/81/2008 4/7 JUDGMENT petitioner Company has filed the affidavit in support of publication of advertisements dated 25.04.2008. 5. In response to the notice to the Official Liquidator, report dated 29.08.2008 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. 6. In response to the notice to the Regional Director, Western Region, Department of Company Affairs, Shri Harin Raval, learned Assistant Solicitor General has appeared and has filed an affidavit of Shri R. K. Dalmia, Dy. Registrar of Companies, Ahmedabad dated 04.12.2008 along with a letter from the Joint Director (Legal) dated 03.12.2008. A perusal of this affidavit would disclose that there are two observations made by the office of the Regional Director. The first observation is regarding furnishing latest financial statements. An affidavit is filed on behalf of the petitioner Company dated 12.12.2008 along with COMP/81/2008 5/7 JUDGMENT which latest audited financial accounts of the petitioner Company as on 31.03.2008 are filed. The second observation is that the Transferor Company is wholly owned subsidiary of the Transferee Company. Clause 10.1 of the Scheme states about issue of shares by the Transferee Company to the shareholders of the Transferor Company, whereas Clause 10.2 of the Scheme states that the equity shares of the Transferor Company held by the Transferee Company or its nominees shall automatically stand cancelled without any further act or deed. In this connection, the petitioner Company may be directed to clarify the correct and exact position before this Court at the time of hearing. With regard to this objection, it is stated in the affidavit that in Clause 10.1 of the Scheme, the ratio of shares to be allotted by the Transferee Company to the shareholders of Transferor Company as per the valuation of the shares is mentioned. The said ratio is worked out at 69 shares in Transferor Company to one share in Transferee Company. However, on facts, the whole share capital of Transferor Company is held by the Transferee COMP/81/2008 6/7 JUDGMENT Company or its nominee and, therefore, the Transferor Company is wholly owned subsidiary of Transferee Company. In view thereof, the Transferee Company is not required to issue any shares to the shareholders of the Transferor Company and, therefore, Clause 10.2 provides that the equity shares of the Transferor Company held by the Transferee Company or its nominees shall automatically stand cancelled without any further act or deed. It is further stated that the Transferee Company had filed Company Petition No.365 of 2008 connected with Company Application No.195 of 2008 in the High Court of Judicature at Mumbai and the Mumbai High Court has sanctioned the said Scheme by its order dated 17.10.2008. 7. Considering the entire facts and circumstances and also the order dated 17.10.2008 made by the Bombay High Court, the present Scheme of Amalgamation is hereby sanctioned and prayers made in paragraph 20 of the petition are hereby granted. 8. The cost of Central Government is quantified at COMP/81/2008 7/7 JUDGMENT Rs.3,500/-. Liberty is given to the Company to pay the amount of cost directly by drawing a cheque in favour of Mr. Harin Raval, learned Assistant Solicitor General. 9. The petition is accordingly disposed of. Sd/- [K. A. PUJ, J.] Savariya