1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY NAGPUR BENCH, NAGPUR. ORDINARY ORIGINAL CIVIL JURISDICTION. COMPANY PETITION No. 7 OF 2007 CONNECTED WITH COMPANY APPLICATION No. 7 OF 2007. In the matter of Companies Act, 1 of 1956 And In the matter of Section 391 & 394 of the Companies Act, 1 of 1956 And In the matter of Scheme of Amalgamation of Ashutosh Casting Ltd. with Neco Castings Ltd. TRANSFEROR. COMPANY. Ashutosh Castings Ltd., An existing Company Incorporated and Registered under the Companies Act 1 of 1956 and having its Registered Office at F-8, MIDC Industrial Area, Hingna Region, Nagpur – 440 016. .... Petitioner. AND 2 COMPANY PETITION No. 8 OF 2007 CONNECTED WITH COMPANY APPLICATION No. 8 OF 2007. TRANSFEREE COMPANY. Neco Castings Ltd., An existing Company Incorporated and Registered under the Companies Act 1 of 1956 and having its Registered Office at 65/1, Nildoh/Digdoh, MIDC Industrial Area, Hingna Region, Nagpur – 440 016. .... Petitioner. COMMON ORDER ON PETITIONS. Smt. Laxmi Swaminathan, Advocate for Petitioners. Shri S.K.Mishra, Standing Counsel for Union of India. Official Liquidator. CORAM : B.P.DHARMADHIKARI, J. Closed for Orders on : 25th March, 2008. Order Pronounced on : 4th April, 2008. After hearing the above mentioned Advocates & Official Liquidator, I proceed to pass the following order:- 3 1. The Transferor Company before filing this Petition had sought exemption & prayed to dispense with the meeting of Creditors as well as the Shareholders of the Transferor/Petitioner Company through Judge's Summons under Company Application filed under Section 391 and 394 of the Companies Act, 1956. This Court granted said prayer of the Transferor Company vide order dated 20th April, 2007 and dispensed with the meeting of the creditors and shareholders. 2. The individual shareholders of the Transferor company have given their consent and the same has been placed on record by the petitioner on 17th April, 2006. The Transferor company has also filed NOC obtained from Maharashtra Industrial Development Corporation, Nagpur vide their letter No. NGP/RON/K- 4/4143/2006 dated 25th August, 2006. 3. As per the audited Balance Sheet for the year ended 31st March, 2006 of the Transferor company, the unsecured creditors of 4 the company are 71 amounting to Rs. 234 lakhs and hence the Transferor company was directed to issue individual notices to the unsecured creditors, i.e. trade creditors on 30th November, 2007 as per order dated 2nd February, 2007 which has been complied by the company. The Transferor company filed an affidavit and stated that the notice to the trade creditors have been sent by R.P.A.D. on 14th January, 2008. 4. On 14th September, 2007 this Court directed the Transferor company to issue notice to Registrar of Companies. The Transferor Company filed an affidavit of Notice to ROC on 16th October, 2007 which is on record. 5. The Regional Director [Western Region] Corporate Affairs, Mumbai on receipt of the notice has filed an affidavit in the said petition whereby he did not object to the scheme of Amalgamation. The Regional Director through his affidavit brought to the knowledge of this court that the accounting treatment being 5 not specified in the scheme & hence requested this Court to direct the petitioner to give an undertaking for compliance of accounting standard 14 issued by the Institute of Chartered Accounts of India. That was the sole objection raised by the Regional Director in Clause 6 of their affidavit dated 30th January 2008 filed by Shri Rakesh Chandra, Regional Director, (Western Region), Ministry of Corporate Affairs. Accordingly this court directed the company on 8th February, 2008 to give an undertaking as to the treatment of accounts on the scheme getting sanction of the Court. The Transferor Company filed a pursis along with the undertaking on 11th March, 2008 that the treatment of accounts shall be as said accounting standard. This court accepts said undertaking. 6. The Official Liquidator has submitted report after carrying out investigation of the books of accounts of the Transferor company through their Chartered Accounts – M/s. A.G. Pimperkhade & Co. As per the report and observations of the auditors, the Official Liquidator has presented his comments to this 6 court and has stated categorically that the affairs of the company have not been conducted in the manner prejudicial to the interest of the members / creditors or to the public interest and also stated that there was no mis-appropriation, breach of trust on the part of the management of the petitioner company. No other bar to the sanction of scheme relevant for consideration under proviso to Section 391 or under Section 394 has been either pointed out by any authority or noticed. 7. The Transferor company also carried out publication of the final hearing of the petition in two daily newspapers, i.e. “Tarun Bharat” and “The Hitwada” on 18th February 2008 and has filed an affidavit of compliance of the order dated 8th February 2008 directing that publication on 5th March, 2008. Final hearing was then fixed on 7th March, 2008. 8. There is no objection to the scheme of amalgamation from the trade creditors, shareholders of the company nor from the 7 Official Liquidators' office and the Regional Director (Western Region), Corporate Affairs, Mumbai. After 7/3/2008, matters were listed for hearing on 14/3/2008 & 18/3/2008 and lastly on 25/3/2008. Still no body has raised any objection to the scheme which is filed as Annexure-F with present proceedings and is placed as Annexure-A with this order. 9. In pursuance of the provisions of Section 394[2] of the Companies Act, 1956 all the existing Licenses, Permits, Quotas, Approvals, Permissions, Incentives, Sales Tax, Deferrals Loans, Subsidies, Grants, Rights, Claims, Leases, Tenancy right, Liberties, Rehabilitation Schemes, Special Status and other benefits or privileges enjoyed and conferred upon or held or availed and accruing to the Transferor Company shall get stand transferred to and vest in or deemed to have been transferred and vested in and be available to the transferee company after the sanction & coming into force of the Scheme under section 392 and 394 of the Companies 8 Act, 1956. 10. Upon coming into effect of the said scheme all secured and unsecured debts, all liabilities, duties and obligations of the Transferor company along with any charge, encumbrance lien or security thereon shall stand transferred to and vest in or deemed to have been transferred to and vested in the Transferee Company so as to become its liabilities, debts, duties and obligations i.e. of Neco Castings Limited as mentioned and elaborated in the scheme. 11. And that this Court further orders that all suits, actions and proceedings by or against both the Transferor company pending and/or arising on or after the appointed date shall be continued and be enforced by or against the Transferee company, as effectively as if the same were or have been pending and/or were against the Transferee Company itself. 12. And that this Court further orders that the Transferee 9 Company shall in order to satisfy its obligation to issue the Equity Shares in accordance with the exchange ratio mentioned in Clause 11 [a][i] of Part IV in the Scheme to the members of the Transferor Company suitably increase its authorised share capital accordingly and that it will obtain the consents, approvals etc. as may be required in that behalf for the purpose of issuance of the allotment of Equity Shares to the shareholders of the company from the Board as well as concerned authorities and comply with Section like 81 or 97 or other relevant provisions of Companies Act in this respect. 13. This court thus hereby sanctions the scheme of Amalgamation of Ashutosh Castings Limited with Neco Castings Limited as set forth in Annexure-F with Company Petition i.e. at Annexure-A to this order and this court hereby declares that the aforesaid scheme of Amalgamation at Annexure-F being sanctioned by the Court in terms of this order shall be binding on both the Transferor Company and the Transferee Company as also on the equity shareholders, secured and unsecured creditors and all other 10 concerned (except employees or workmen) with both the Transferor and Transferee Company. 14. This Court further orders that the arrangement embodied in the Scheme of Amalgamation at Annexure-F with company petition, being sanctioned by this Court shall be binding on the Transferor company and the Transferee Company, its members, secured creditors and unsecured creditors and that the employees of the Transferor Company in service or deemed to be in service due to court orders on the date on which the certified copy of this order is delivered to the Registrar of Companies, Western Region, Maharashtra State, in compliance of this order shall become the employees of the Transferee Company with effect from the such date without any break or interruption in their services and on the terms and conditions which shall not be less favourable than those subsisting while in employment with transferor company just prior to the said date. 11 15. The transferor company as also the transferee company shall file certified copy of this order along with scheme at its Annex. A within 30 days with the Registrar in compliance with Section 394(3) of the Companies Act. Upon such filing the transferor company shall stand dissolved. Registrar of companies shall immediately place all records & papers in relation to Transferor company on file/records relating to Transferee company. Thus the records & papers of both the companies shall stand consolidated accordingly. 16. Any person interested in the matter is always at liberty to apply to this Court for any directions as may be found necessary. JUDGE Rgd.