IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY PETITION NO.526 OF 2009 CONNECTED WITH COMPANY APPLICATION NO.531 OF 2009 Kirloskar Oil Engines Limited........Petitioner/Demerged Company COMPANY PETITION NO.527 OF 2009 CONNECTED WITH COMPANY APPLICATION NO.532 OF 2009 Kirloskar Engines India Limited........Petitioner/Resulting Company In the matter of the Companies Act I of 1956 AND In the matter of Section 391 to 394 of the Companies Act,1956 AND In the matter of the Scheme of Arrangement between Kirloskar Oil Engines Limited and Kirloskar Engines India Limited. Hemant Sethi i/b Hemant Sethi & Co. Advocates for Petitioner Ms. Purnima Awasthi and Mr. S. C. Pal i/b S.K. Mohapatra for Regional Director in both the Petitions. CORAM: S. J. KATHAWALLA. J DATE : 31st JULY, 2009 PC: 1. Heard learned counsel for parties. 2. The sanction of the Court is sought under Section 391 to 394 of the Companies Act, 1956 to the Scheme of Arrangement between Kirloskar Oil Engines Limited, the Demerged Company and Kirloskar Engines India Limited, the Resulting Company. 3. The Scheme of Arrangement is presented for demerger of Engines and Auto Components business of Kirloskar Oil Engines Limited into Kirloskar Engines India Limited and Reduction and reorganisation of issued, subscribed and paid up shares capital of Kirloskar Oil Engines Limited pursuant to the relevant provisions of the Companies Act, 1956. 4. Counsel appearing on behalf of the Petitioner have stated that they have complied with all the requirements as per directions of this Court and they have filed necessary affidavits of compliance in the Court. Moreover, Petitioner Companies also undertake to comply with all statutory requirements, if any, as required under the Companies Act, 1956 and the rules made thereunder. 5. In the case of Kirloskar Oil Engines Limited in Company Petition No.526 of 2009. The Equity Shareholders in the court directed meeting held on 13th June,2009 has approved, Resolution No.1 being the Scheme of Arrangement with corrected Schedule B between Kirloskar Oil Engines Limited and Kirloskar Engines India Limited and also Resolution No.2 being Special Resolution for Reduction and reorganisation of issued, subscribed and paid up 2 Share Capital of Kirloskar Oil Engines Limited pursuant to Scheme of Arrangement in terms of Section 100 and other applicable provisions if any of the Companies Act, 1956, by the requisite majority of Equity Shareholders and more than three-fourth in value by the members present and validly voted at the meeting of the Petitioner/Demerged Company. The meeting of Secured and Unsecured Creditors were dispensed with vide order dated 24th April, 2009 in Company Application No.531 of 2009. 6. In view of averment made in paragraph 25 of the Company Petition No.526 of 2009 the reduction and reorganisation of Share Capital does not involve neither diminution of liability in respect of unpaid capital nor payment to any shareholder of any unpaid share capital account and the interest of the creditors of the Petitioner/Demerged Company are not affected by such reduction and the procedure under section 101(2) of the Companies Act, 1956 has been dispensed with vide order dated 24th April,2009 in Company Application No.531 of 2009. 7. In the case of Kirloskar Engines Limited in Company Petition No.527 of 2009. The meetings of Equity Shareholders and Unsecured Creditors was dispensed with in view of the consents being given by all the Equity Shareholders and sole Unsecured Creditors vide order dated 24th April,2009 in Company Application No.532 of 2009. 3 8. The Regional Director has filed affidavit stating therein that the scheme is not prejudicial to the interest of shareholders and public. 9. Upon perusal of the entire material on record, in my opinion the Scheme appears to be fair and reasonable and is not violative of any provisions of law and is not contrary to any public policy. None of the parties concerned have come forward to oppose the Scheme. Moreover, the Regional Director has stated that the scheme as proposed is not prejudicial to the interest of shareholders and the public. 10. There is no objection to the Scheme of Arrangement with corrected Schedule B and since all the requisite statutory compliances have been fulfilled Company Petition filed by the Demerged Company and the Resulting Company are made absolute in terms of prayer clause (a) to (f) in Company Petition No.526 of 2009 filed by the Demerged Company and prayer clause (a) to (b) in Company Petition No.527 of 2009 filed by the Resulting Company. 11. The Resulting Company to lodge copy of this order and the Scheme with corrected Schedule B duly authenticated by the Company Registrar, High Court, (O.S) Bombay with the concerned Superintendent of Stamps for the purpose of adjudication of stamp 4 duty, payable, if any, on the same within 30 days from the date of order of Order. 12. The Petitioner in both the Companies to pay cost of Rs.7,500/- each to the Regional Director. Costs to be paid within four weeks from today. 13. Petitioner in Company Petition No.526 of 2009 to publish notice of registration of order and minute of reduction by Registrar of Companies once each in the two local newspaper viz The Indian Express in English and Loksatta in Marathi both circulating in Pune and in the Maharashtra Government Gazette within 14 days of registration aforesaid. 14. Filing and issuance of the drawn up order is dispensed with. 15. All concerned authorities to act on a copy of this order along with scheme with corrected Schedule B (in case of Company Petition No.526 & 527 of 2009) and also form of minutes (in case of Company Petition No.526 of 2009) duly authenticated by Company Registrar, High Court, Bombay. (S. J. KATHAWALLA, J) 5