THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Company Petition No.209 of 2009 (Dated : 30-03-2010) Between: Polyinks Limited Represented by its authorized signatory Mr.S.Rengarajan ..Petitioner (Transferor Company) THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Company Petition No.209 of 2009 ORDER: This petition has been taken out under Sections 391 and 394 of the Companies Act, 1956 seeking sanction to the scheme of amalgamation of POLYINKS LIMITED (hereinafter referred to as “Transferor Company”) with HENKEL CAC PRIVATE LIMITED (hereinafter referred to as “Transferee company”). 2. The Transferor Company was incorporated on 15th April, 1985 under the Companies Act, 1956 as a Private Limited Company with the Registrar of Companies, New Delhi under the name and style of M/s.Polyinks Private Limited. The registered office of the Transferor Company was shifted from New Delhi to the State of Andhra Pradesh. The Transferor company changed its status from a private company to a public company and consequently, obtained a fresh certificate of incorporation. 3. The main objects of the Transferor Company are: (1) (a) To carry on business of manufacturers, processors, blenders, formulators, dealers of exporters and importers of ink, varying shears, paints, glues, adhesives, waxes and any other printing, laminating, coating or other protective or decorative surfacing materials. (b) To plan, develop, acquire, buy or sell know- how relating to the manufacture or application of coating and printing materials. (2) To carry on the business of dealers in machinery of all kinds for printing converting, cutting, slitting, bag making, die-cutting, embossing varnishing packing, engraved gravure cylinders. 4. The authorized share capital of the Transferor Company is Rs.1,00,00,000/- (Rupees one Crore only) comprising 10,00,000 (Ten Lakhs) equity shares of Rs.10/- (Rupees Ten only) each. The issued, subscribed and paid up share capital of the Transfer Company as on 31.3.2009 is Rs.75,00,000/- (Rupees seventy five lakhs only) divided into 7,50,000/- (Seven Lakhs Fifty thousand) equity shares of Rs.10/- (Rupees Ten only) each, fully paid up. 5. M/s.HENKEL CAC PRIVATE LIMITED-Transferee Company was incorporated on 20th March 1984 under the Companies Act, 1956 with the Registrar of Companies, Maharashtra, Bombay under the name and style of M/s. Converter Adhesives and Chemicals Private Limited. Subsequently, the Transferee Company changed its status from Private Limited to Public Limited Company. It also changed its name from M/s. Converter Adhesives and Chemicals Private Limited to M/s.Henkel CAC Private Limited and obtained a fresh certificate of incorporation. The Transferee Company is having its registered office at #906, 9th Floor, Embassy Centre, Nariman Point, Mumbai.400 021, Maharashtra. 6. The main objects of the Transferee company are to carry on the business as manufacturer, processors, traders, importers, wholesalers etc. The objects are more fully described in para 7 of the petition. 7. The salient features of the scheme of amalgamation have been stated in para 11 of the petition. It is specifically stated in the petition that the employees of the Transferor Company shall become the employees of the Transferee company without any break or interruption in the service. 8. The meeting of the shareholders and unsecured creditors of the Transferor company has been dispensed with, as per orders dated 18.12.2009 passed in Company Application No.1951 of 2009. 9. The Company Petition came to be admitted on 28.01.2010. The petitioner-Transferor Company was directed to take out notice to the Regional Director, Ministry of Corporate Affairs, Chennai and Registrar of Companies, Andhra Pradesh, Hyderabad. The Transferor Company was also directed to take out notice of hearing of this Company Petition by publishing the same in “Eenadu” Telugu daily and “Deccan Chronicle” English daily, Hyderabad editions fixing the date of hearing as 18.02.2010. 10. The Transferor Company carried out publication as ordered by this Court and filed copies of publication. 11. The Registrar of Companies placed on record the affidavit dated 18.3.2010 reporting no objection for considering the scheme subject to approval of the High Court of Bombay as the Transferee Company has its registered office in the state of Maharashtra. It is also stated in the affidavit that the Transferee Company should pay Stamp Duty wherever applicable. 12. The Official Liquidator filed report, bearing O.L.R.No.91 of 2010. The relevant portion of the report of the Official Liquidator reads as hereunder:- “ That as per the Balance Sheet as on 31.3.2009, the Transferor Company has no secured creditors. There is only one unsecured creditor viz., M/s.Henkael CAC Private Limited, i.e., Holding/Transferee Company to an amount of Rs.11,96,00,000/-. Consent letter from the said company have been furnished. It is further noticed that the petitioner/Transferor Company has furnished the list of 36 unsecured creditors to the tune of Rs.2,50,40,277/- as on 15/10/2009. However, the Petitioner Company has furnished consent letters in respect of 6 major unsecured creditors to the tune of Rs.2,31,65,858/- against the total amount of Rs.2,50,40,277/-. No consent letters have been furnished remaining 30 unsecured creditors to the tune of Rs.18,74,419/-:”. 13. As per sub-section (2) of Section 391 of the Companies Act, 1956, what is required is a majority in number representing three-fourths in value of the creditors. For better appreciation, I may refer Section 391(2) of the Act, which reads as hereunder:- 391(2) If a majority in number representing three- fourths in value of the creditors, or class of creditors, or members, or class of members, as the case may be, present and voting either in person, or where proxies are allowed[under the rules made under section 643], by proxy, at the meeting, agree to any compromise or arrangement, the compromise or arrangement shall, if sanctioned by the [Tribunal], be binding on all the creditors, all the creditors of the class, all the members, or all the members of the class, as the case may be, and also on the company, or in the case of a company which is being wound up, on the liquidator and contributories of the company; 14. The report of the Official Liquidator is explicit that 90% of the unsecured creditors have given their consent for the proposed scheme of amalgamation. Therefore, it is to be construed that the unsecured creditors have consented for the proposed scheme of amalgamation. 15. No objection has been received from any one opposing the proposed scheme of Amalgamation of the Transferor Company with the Transferee Company. 16. Heard learned counsel appearing for the petitioner as well as the learned counsel appearing for the Official Liquidator and learned Assistant Solicitor General appearing on behalf of the Registrar of Companies. Perused the material brought on record. 17. 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. 18. In the facts and circumstances, I do not see any impediment in granting sanction to the scheme of amalgamation as proposed by the petitioner company, since all the requisite statutory compliances have been fulfilled. This sanction, however, is subject to Transferee Company getting similar orders from the Bombay High Court. 19. Accordingly, this Company petition is allowed sanctioning the scheme of Amalgamation subject to the Transferee Company getting similar approval from the Bombay High Court. The parties to the scheme or other persons interested shall be at liberty to apply to this Court for any directions that may be necessary in regard to working of the scheme; and the Transferor Company do file with the Registrar of Companies an authenticated copy of this order and the scheme within 30 days from this day. 20. The Transferor company to pay costs of Rs.3,000/- each to the Regional Director, Department of Company Affairs, Southern Region, Chennai and also the Official Liquidator attached to this Court towards costs of this petition. Costs are to be paid within four weeks from today. _____________________ B.SESHASAYANA REDDY, J Dt.30-03-2010 RAR THE HON’BLE SRI JUSTICE B.SESHASAYANA REDDY Company Petition No.209 of 2009 (Dated : 30-03-2010)