(Prayer: This C.A. is filed under Section 391 of the Companies Act, 1956, r/w Rules 6 and 9 of the Companies (Court) Rules, 1959, praying to the meeting of the equity shareholders be convened and the meeting of the preference shareholders and creditors of the applicant company under Section 391 of the Companies Act, 1956, be dispensed with if considered fit or otherwise, that it be convened and held for the purpose of considering, and if thought fit, approving with or without modification(s) the scheme, and etc.)
1. The applicant (for short 'Transferor company') is a company incorporated under the Companies Act, 1956 (for short 'Act') having its registered office at the address shown in the cause-title carrying on the business of manufacture and dealing in sugar, jaggery, byproducts thereof etc., as set out in the Memorandum and Articles of Association Annexure-"A".
2. The authorized, issued, subscribed and paid up share capital of the applicant company is more fully specified in paragraph 4 of the affidavit of Mr. Amar Kumar Dora, Company Secretary of the applicant company. The Balance sheet made upto 31.3.2016 Annexure-D, duly audited by the Chartered Accountants discloses the assets and liabilities of the applicant-company.
3. At paragraph 13 of the affidavit, it is stated that the Board of Directors of the applicant company have approved and adopted the Scheme of Amalgamation Annexure-E dated 10.05.2016.
4. The learned counsel for the applicant-company submits that there are 13,657 Equity Shareholders as stated in parapraph-18 of the affidavit and that the applicant be permitted to convene and hold the meetings of the said Equity Shareholders to consider the Scheme of Amalgamation Annexure - F.
5. At paragraph 19 of the affidavit, it is stated that there is only one Preference shareholders of the applicant Company and the certificate issued by Chartered Accountant and consent thereof is produced as Annexure-H series.
6. At paragraph 21 of the affidavit, it is stated that there are 34 unsecured creditors of the applicant- company as per the certificate issued by the Chartered Accountant dated 06.06.2016 and their consent letters is produced as per Annexure-K series.
7. The applicant- company has placed before this court all relevant materials in respect of relief sought for to dispense with the meeting of Preference shareholders, and unsecured creditors to consider the scheme of Amalgamation.
8. As far as the prayer made by the learned counsel for the applicant for dispensation of meeting of the secured creditors, it is noticed that there are 3 secured creditors, one of them is Sugar Development Fund backed by Bank Guarantee extended by Induslnd Bank. The Iuduslnd Bank vide its communication/consent letter dated 07.09.2016 has given their consent to the said Amalgamation, but it appears that Induslnd Bank is only a guarantor for the said advance given by Sugar Development Fund constituted Central Board for advancing loans to the sugar industries.
9. In the present case, loan of Rs.32.40 crores is shown to have been advanced by the Sugar Development Fund to the applicant-company.
Therefore, the consent of the Sugar Development Fund itself should have been produced for seeking such dispensation of the meeting of the secured creditor and the consent given by Induslnd Bank, the guarantor cannot be held sufficient for that purpose.
10. The learned counsel for the applicant- company submits that the company would approach the Sugar Development Fund itself and seek their consent or in the alternative, would pray for holding for such meeting and for that purpose, a period of four weeks may be allowed to them.
11. Having regard to the material placed on record and the submissions of the learned counsel, I think it appropriate to allow the application. Hence the following order:-
(i) The meeting of the preference share holders and unsecured creditors of the applicant company to consider the Scheme of Amalgamation Annexure - F is dispensed with.
(ii) The applicant-company is permitted to convene the meeting of Equity shareholders on 09.11.2016 at 10.30 a.m., at Khincha Hall, Bharatiya Vidya Bhavan, Race Course Road, Bengaluru- 560 001, under the chairmanship of Mr.V.Ramesh, Director, failing him Mr.V.Ravichandran, Director, failing him, Mr.C.R.Rajan, Director of applicant- company.
(iii) The quorum for the meeting of Equity Shareholders shall be 30.
(iv) Vote by proxy is permitted.
(v) The Chairman shall issue individual notices enclosing copies of the scheme of Amalgamation, the explanatory statement and the form of proxy as required under Section 393 to all the Equity shareholders.
(vi) The Company shall cause advertisement of the meeting in one edition of the English daily "The Hindu" (Bangalore Edition) and one edition of the Kannada daily "Udayavani" (Bangalore Edition) on or before 08.10.2016.
(vii) The Chairman shall file his report within two weeks from the date of the meeting.