THE HON'BLE MR JUSTICE G.V.SEETHAPATHY COMPANY PETITION Nos :77 & 78 of 2010 DATED:25-06-2010 COMMON ORDER: These petitions are filed under Sections 391 and 394 of the Companies Act, 1956 ( for brevity, ‘the Act’) read with Rules 67, 69 and 9 of the Companies (Court) Rules, 1959, seeking sanction for amalgamation as per Annexure-9, which is enclosed in the petitions. 2. Company Petition No.77 of 2010 is filed by M/s Sri Krishna Engineering Profiles (India) Private Limited, Visakhapatnam (hereinafter referred to as ‘transferor company’). 3. Company Petition No.78 of 2010 is filed by M/s Ananda Profiles Private Limited, Visakhapatnam (hereinafter referred to as ‘transferee company’). 4. At the time of admitting these petitions, notices were ordered to be issued to the Regional Director, Ministry of Corporate Affairs, Chennai and the Official Liquidator, attached to this Court, and the petitioner was directed to take out publication in ‘The Hindu’ English daily and ‘Vartha’ Telugu daily newspapers of Visakhapatnam District Editions. Notices were duly sent and the learned Assistant Solicitor General entered appearance on behalf of the Ministry for Corporate Affairs, Chennai, and filed a common affidavit raising no objection for the proposed amalgamation and stating that the transferee company should pay the stamp duty, wherever applicable, as per the regulations of the A.P.Stamp Act. 5. The Official Liquidator filed a report in O.L.R.No.2731 of 2010 in C.P.No.77 of 2010, stating that the Official Liquidator called for statutory books and other relevant information from the transferor company and on examining the same, it is observed that the affairs of the company appeared to have not been conducted in a manner prejudicial to the interest of the members or to public interest. 6. Heard learned counsel for the petitioner companies; learned counsel representing the Official Liquidator and the learned Assistant Solicitor General. Perused the records. 7. The transferor company-M/s Sri Krishna Engineering Profiles (India) Private Limited was incorporated under the provisions of the Act on 08-09-2004 with its registered office at Visakhapatnam. The authorized share capital of the transferor company is Rs.1,50,000/- divided into 15,00,000 equity shares of Rs.10/- each. The issued, subscribed and paid up capital of the transferor company is Rs.1,19,10,000/- divided into 11,91,000 equity shares of Rs.10/- each. The main object of the transferor company is to carry on the business of running re-rolling mill for the manufacture of steel plates, sheets, angles, bars, rods, wire drawings of different sizes and specifications of all types of mild, high carbon special steels, alloy steels and other metals and also to erect roughing mill for manufacturing billets from ingots to be used in the rolling mill. The objects of the transferor company are set out in detail in the ‘Memorandum of Association’. 8. The transferee company-M/s Ananda Profiles Private Limited was incorporated under the provisions of the Act on 01-12-1999 with its registered office at Visakhapatnam. The authorized share capital of the transferee company is Rs.5,00,00,000/- divided into 50,00,000/- equity shares of Rs.10/- each. The issued, subscribed and paid up capital is Rs.4,65,68,590/- divided into 46,56,859 equity shares of Rs.10/- each. The main object of the transferee company is the same as that of the transferor company i.e. to carry on the business of re-rolling mill. The objects of the transferee company are set out in detail in the ‘Memorandum of Association’. 9. The transferor and transferee companies proposed to set out a scheme of amalgamation of the two companies and the salient features of the scheme are set out in detail in these petitions. In short, the amalgamation proposes from becoming effective the entire business and undertaking Sri Krishna Engineering Profiles (India) Private Limited together with all its properties, assets, rights, benefits and interest therein shall be transferred to and vested in M/s Ananda Profiles, the transferee company, as a going concern. The consequences of the proposed amalgamation of the two companies, the financial, legal and other aspects are set out in detail in these petitions and they are not reiterated here, for the sake of brevity. It is proposed that on the scheme becoming effective and operative, the transferee company shall stand dissolved without winding up. It is also stated in the petitions that the proposed scheme of amalgamation will not affect the creditors of either the transferor company or that of the transferee company, and the transferee company will in terms of the scheme take over all the debts, duties, obligations and liabilities of the transferor company. It is stated that the merged entity will have better asset base and in the event of any necessity, work as additional security to the creditors of the merged entity and the assets of the merged entity will be sufficient to take care of the liabilities in all respects. It is also stated that the scheme of amalgamation is in the interest of both the transferor and transferee companies, their respective shareholders, employees and creditors. 10. It is stated that the meeting held on 19-03-2010 approved the scheme of amalgamation with effect from 01-04-2009. A copy of the resolution of the Board of Directors of both the companies is filed. There are eight shareholders in the transferor company and sixteen shareholders in the transferee company and all of them have filed affidavits, stating no objection for the proposed amalgamation. It is stated that there are no secured or unsecured creditors for the transferor company whereas there is one secured creditor and four unsecured creditors for the transferee company and all of them have given letters of consent agreeing for the proposed amalgamation. It is not disputed that the meeting of the shareholders of the transferor company was dispensed with by order, dated 08-04-2010, in C.A.No.245 of 2010 and the meeting of the shareholders and creditors of the transferee company was dispensed with by order, dated 08-04-2010, in C.A.No.246 of 2010. 11. Thus, having regard to the facts that both the companies are doing the same type of business i.e. running re-rolling mill and the scheme of amalgamation proposed is duly approved by the Board of Directors of both the companies and the shareholders of both the companies have no objection for the same and the sole secured creditor and four unsecured creditors of the transferor company have also consented for the proposed amalgamation and the interest of the creditors is duly taken care of under the terms of the scheme of amalgamation and no objections have been received from any part, in response to the publication made in ‘The Hindu’ English daily and ‘Vartha’ Telugu daily of Visakhapatnam editions and the Central Government and the Official Liquidator having no objection for the proposed scheme of amalgamation of the companies, it is considered that the consent be accorded for the proposed scheme of amalgamation, as set out in Annexure No.9 of the Company Petitions 77 & 78 of 2010, to be effective from 01-04-2009. On such amalgamation, the transferor company shall stand dissolved without going through the process of winding up. Petitioner company shall file a certified copy of this order before the Registrar of Companies, Hyderabad, within thirty days. 12. Accordingly, both the petitions are ordered. _______________________ G.V.SEETHAPATHY,J 25th June, 2010. Tsy