IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION COMPANY PETITION NO.230 OF 2009 CONNECTED WITH COMPANY APPLICATION NO.167 OF 2009 WALL STREET FINANCE LIMITED …………Petitioner / Demerged Company. COMPANY PETITION NO.231 OF 2009 CONNECTED WITH COMPANY APPLICATION NO.168 OF 2009 GOLDMAN SECURITIES PRIVATE LIMITED …………Petitioner / Resulting Company. In the matter of Scheme of Arrangement between WALL STREET FINANCE LIMITED, the Demerged Company and GOLDMAN SECURITIES PRIVATE LIMITED, and their respective shareholders and creditors. Mr. Rajesh Shah i/b Rajesh Shah & Co., for the Petitioners. Ms. Bharti Mahant and Ms. Heena Shah i/b Mr. S.K. Mohapatra for Regional Director in C.P. No.230 of 2009 to 231 of 2009 CORAM: A. M. Khanwilkar, J. DATE: 17th 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 Arrangement between Wall Street Finance Limited, the Demerged Company and Goldman Securities Private Limited, and their respective shareholders and creditors for the transfer of instant cash division of Wall Street Finance Ltd into Goldman Securities Private Limited. 3. 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 4. The Regional Director has filed Affidavit stating therein that save and except as stated in para 6(a) and 6(b) of the said Affidavit, it appears that the scheme is not prejudicial to the interest of creditors, shareholders and public 5. The Paragraph 6(a) of the said Affidavit reads thus: “the Accounting treatment proposed to be given in the books of GSPL (Resulting Company) envisages for crediting the excess of the value of assets over the liabilities of Instant Cash Division to the profit and loss account. This appears to be not in consonance with generally accepted accounting principle, as that any profits arising out of capital transaction like merger or demerger ought to be treated as capital profits and hence shall be transferred to Capital Reserve and not to General Reserve”. 6. However in para 6(b) of the affidavit, the Regional Director has stated that: 3 “The Demerged Company is a NBFC and hence the Demerged Company may be directed to file a copy of the Hon’ble Court’s order on this petition within 30 day’s thereof, with the RBI” 7. In reply to the aforesaid objection raised by the Regional Director, both the Companies have filed their respective Affidavits, so far as objection in Paragraph 6(a) of the Affidavit of the Regional Director is concerned, the Petitioner/Resulting Company in its Affidavit has submitted that they would credit the excess of the value of assets over the value of liabilities of the Instant Cash Division to the Capital Reserve Account. Accordingly, clause 8.3 of the scheme stands modified to the said extent. Further in reply to objection raised in Paragraph 6(b) of the said Affidavit, the Petitioner/Demerged Company has submitted that they would file a copy of the scheme and the court order sanctioning the scheme with Reserve Bank Of India within 30 days of obtaining the said order. 4 8. Upon perusal of the entire material placed on records, 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 appeared to oppose the Scheme. Moreover, the Regional Director has stated that the Scheme as proposed is not prejudicial to the interest of shareholders and public. 9. There is no objection to the Scheme and since all the requisite statutory compliances have been fulfilled, Company Petitions Nos.230 of 2009 and 231 of 2009 filed by the Petitioner Companies are made absolute in terms of prayer clauses (a) to (c) of the respective Petitions. 10. The Petitioner Companies to lodge a copy of this order and the Scheme duly authenticated by the Company Registrar, High Court (O.S.), Bombay, with 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. 5 11. The Petitioners in both the Company Petitions to pay cost of Rs.7,500/- each to the Regional Director. Costs to be paid within four weeks from today. 12. Filing and issuance of the drawn up order is dispensed with. 13. 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