IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY PETITION NO.65 OF 2009 CONNECTED WITH COMPANY APPLICATION NO.1095 OF 2009 RELIABLE PAPER (INDIA) LIMITED …………Petitioner / Transferor Company. COMPANY PETITION NO.66 OF 2009 CONNECTED WITH COMPANY APPLICATION NO.1096 OF 2009 OPEL PAPER MILL LIMITED ………Petitioner / Transferee Company. COMPANY PETITION NO.67 OF 2009 CONNECTED WITH COMPANY APPLICATION NO.1097 OF 2009 PRIME HYGIENE PAPERS PRIVATE LIMITED .………Petitioner / Transferee Company. Mr. Rajesh Shah i/b Rajesh Shah & Co., for the Petitioners. Mr. M. Chandanamuthu, Dy. Official Liquidator in all Petitions Mr. Bhardwaj and Mr. P. Khosla i/b Mr. S.K. Mohapatra for Regional Director in all Petitions. CORAM: A. M. Khanwilkar, J. DATE: 10th July, 2009 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 the Reliable Paper (India) Limited, the First Transferor Company, Opel Paper Mill Limited, the Second Transferor Company and Prime Hygiene Papers Private Limited, the Third Transferor Company with Speciality Papers Limited, the Transferee Company. 3. The Registered office of the Transferee Company is situated at Valsad in state of Gujarat. The counsel appearing on behalf of the Petitioners state that the said Transferee Company has filed its petition for sanctioning the said scheme in High Court of Gujarat and the said petition is now pending for hearing before Gujarat High Court. 4. Counsel appearing on behalf of the Petitioners has stated 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 also undertake to comply with all statutory requirements if any, as required under the Companies Act, 1956 and the Rules made there under. 2 5. The Regional Director has filed Affidavit stating therein that save and except as stated in paragraphs 6 (a) to 6 (d) of the said Affidavit, it appears that the Scheme is not prejudicial to the interest of shareholders, creditors and the public. In paragraph 6 of his Affidavit the Regional Director state and submit as under :- 6 (a) The Second Transferor Company and Transferee Company accepted unsecured loans from others (other than its Director) which is in violation of section 58A of the Companies Act, 1956. (b) The Transferee Company had transaction with Prime Industries, a firm in which Managing Director to the partner and sold goods to Opel Paper Mills Private Limited which is in violation of section 297 of the Companies Act, 1956 by the Transferor Company. (c) The Second Transferor Company given loans and advances to Urmila M Gala which appears to be in violation of section 295 fo the Companies Act, 1956 by the Second Transferor Company. (d) the Second Transferor Company is a closely held public limited Company and Transferee Company is a listed public limited company having its registered office in the Sate of Gujarat. As regards violation of section 58A and 295 by the Second Transferor Company the Registrar of Companies, 3 Mumbai has been directed to initiate necessary penal action in respect of the same. As regards violation of section 58A and 297 by the Transferee Company the Registrar of Companies Gujarat has been directed to initiate necessary penal action in respect of the same. 6. Mr. Mekan J Gala, Director of the Second Transferor Company has filed his affidavit dated 3rd July, 2009 in Company Petition No. 66 of 2009 in reply to the objections raised by the Regional Director in his Affidavit. In the said Affidavit, the Second Transferor Company has, inter alia, stated that as regards the alleged violation under section 295 and 58A of the Act by the Petitioner / Second Transferor Company, the Second Transferor Company undertakes to file compounding application for the said violations. The said undertaking is accepted. So far as the violations made by the Transferee Company is concerned, it is stated that separate Company Petition is filed before the Gujarat High Court which is pending before the said Court and the Gujarat High Court will consider alleged violations in accordance with law. It is further stated that none of the alleged violations referred to by the Regional Director have any bearing whatsoever on the Scheme and hence do not come in the way of the scheme being sanctioned by the Court. It is also stated that it is always open to the Regional Director to adopt such proceedings in accordance with law with regard to the alleged violations against the Company and its 4 Directors, as the case may be, even after the scheme is sanctioned. It is also stated that the Transferee Company has no objections to such liberty being reserved to the Regional Director subject to the Company’s right to defend such proceedings in accordance with law and that if any such proceedings are adopted against the Transferee Company, the same can be and may be continued against the Transferee Company. 7. In view of the statements made in the said affidavits, the Regional Director/Registrar of Companies is at liberty to adopt appropriate proceedings in accordance with Law against the Petitioner Companies for the aforesaid violations. Moreover, it is not stated and there is nothing to suggest that the alleged violations are detrimental to the scheme as such. 8. The Official Liquidator has filed report in Company Petition Nos.65 of 2009 to 67 of 2009 stating therein that the affairs of the Transferor Company have been conducted in a proper manner and that the Transferor Company may be ordered to be dissolved without winding up of the Company. 9. Upon perusal of the entire material placed on record, 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 has come forward to oppose the Scheme. Moreover, the Regional Director has stated that the Scheme as proposed is not 5 prejudicial to the interest of shareholders, creditors and the public and the Official Liquidator has stated that the affairs of the Transferor Company have been conducted in a proper manner. 10. There is no objection to the Scheme, save and except as stated in paragraph 4 and 5 hereinabove, and since all the requisite statutory compliances have been fulfilled, Company Petitions are made absolute in terms of prayer clauses (a) to (j). The scheme is sanctioned subject to the order to be passed by the High Court of Gujarat. 11. The Petitioner Companies to lodge a copy of this order and the Scheme with duly authenticated by the Company Registrar High Court, (O.S.) Bombay, the concerned Superintendent of Stamps for the purpose of adjudication of stamp duty payable, if any, on the same within 30 days from the date of the order. 12. The Petitioners in all the Company Petitions to pay cost of Rs.7,500/- each to the Regional Director and to the Official Liquidator. 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 Scheme duly authenticated by the Company Registrar, High Court, Bombay. (A .M. Khanwilkar, J.) 6