Judgment:
ORDER
H.G. Ramesh, J.
1. In both these petitions, the petitioner - M/s. Pramod Foods Private Limited ('transferor company') and the petitioner - M/s.John Distilleries Limited ('transferee company') have sought for sanction of the Scheme of Amalgamation at Annexure-A, so as to be binding on the transferor company and the transferee company and their respective shareholders and creditors and all other persons. Hence, both the petitions are heard together and are being disposed of by this order.
2. The transferor company was incorporated on 19.6.1985 under the provisions of the Companies Act, 1956 with the Registrar of Companies, Karnataka, Bangalore to carry on the business of manufacture, conversion, procession, production, packing, refining, maintaining, exporting, importing, buying, selling, rendering of services of all and every Kind and acting as agents of all types and forms of food stuffs and eatables including biscuits, bread, cakes, pastries etc. The registered office of die transferor company is situate at No. 17/1, Campbell Road, Austin Town, Bangalore - 560047.
3. The transferee company was incorporated on 19.9.1996 tinder the provisions of the Companies Act, 1956 with the Registrar of Companies, Karnataka, Bangalore to carry on the business of manufacture, exchange, dealers, export, import, brewing and distilling all kinds of beer, wine, liquor, spirits, rum, whisky, cognac, Indian made foreign liquors etc. The registered office of the transferee company is situate at No. 110, Pantharapalya, Mysore Road, Bangalore - 560039.
4. The Board of Directors of the petitioner-companies have approved and adopted the Scheme of Amalgamation in their respective Board Meetings held on 25.7.2008, by virtue of which the transferor company is proposed to be merged with the transferee company subject to confirmation of this Court.
5. The transferee company has filed C.A. No. 911/2008 for dispensation of the meeting of the shareholders and to permit to convene the meetings of the secured and unsecured creditors for approving the Scheme of Amalgamation. This Court, by its order dated 1.12.2008, allowed the said application and dispensed with the meeting of the shareholders and directed to convene the meetings of the secured and unsecured creditors. The meetings of the secured and unsecured creditors of the transferee company was held on 30.12.2008 as directed by this Court and both the meetings approved the said scheme unanimously. The Chairman of the meetings has filed reports relating to the aforesaid meetings on 9.1.2009.
6. The transferor company has filed C.A. No. 912/2008 before this Court for dispensation of the meetings of the shareholders and creditors for approving the Scheme of Amalgamation. This Court, by its order dated 1.12.2008, allowed the said application and dispensed with the meetings of the shareholders and creditors of the transferor company.
7. Co. P. 131/2008 was filed by the transferor company on 5.12.2008 and this Court, by its order dated 8.12.2008, issued notice to the Regional Director and to the Official Liquidator. The transferor company was also directed to take out notice of the petition in the newspapers-'The Hindu'-an English daily and Udayavani'-a Kannada daily on or before 30.12.2008 notifying the date of hearing as 21.1.2009. Accordingly, notice of the petition was published in the said newspapers on 27.12.2008.
8. Co.P.2/2009 was filed by the transferee company on 9.1.2009 and this Court, by its order dated 16.1.2009, issued notice to the Regional Director. The transferee company was also directed to take out notice of the petition in the newspapers-'The Hindu'-an English daily and 'Udayavani'-a Kannada daily on or before 30.1.2009 notifying the date of hearing as 20.2.2009. Accordingly, notice of the petition was published in the said newspapers on 22.1.2009.
9. The Official Liquidator had filed OLR.611/2008 for appointment of a Chartered Accountant to verify the books and records of the transferor company. This Court, by its order dated 9.1.2009, appointed Sri H.D. Ramakrishna, Chartered Accountant to verily the books and records of the transferor company and to file his report.
10. The Official liquidator has filed OLR.102/2009 based on the report filed by the Chartered Accountant and stated that the affairs of the transferor company had not been conducted in a manner prejudicial to the interests of its members or to the public. The Registrar of Companies in Karnataka has filed an affidavit on behalf of the Regional Director, Ministry of Corporate Affairs, Southern Region, Chennai stating that the exchange ratio of allotting 50 equity shares of Rs. 10/- each by the transferee company for one equity share of Rs. 100/- each held in the transferor company prima facie appears to be on the higher side.
11. The objection raised by the Regional Director relating to exchange ratio of the shares to be allotted cannot be sustained in the light of the observations made by the Hon'ble Supreme Court in Miheer H. Mafatlal v. Mafatlal Inds. Ltd. 1996(87) Comp Cas 792.
12. Learned Counsel for the Official Liquidator and the Registrar of Companies submit that they have no objection for grant of the Scheme of Amalgamation at Annexure-A. It is stated that the scheme will be beneficial to the transferor company and its creditors and also the respective members of the transferee company and will result in better and more efficient operation of the transferee company, post amalgamation. Accordingly, I make the following order:
a) the Scheme of Amalgamation at Annexure-A is hereby sanctioned;
b) the petitioner-M/s. Pramod Foods Private Limited in Co.P. 131/2008 (transferor company) stands dissolved without there being an order of winding up;
c) the Registry to draw up a decree in Form - 42;
d) both the petitioner-Companies shall file a copy of this order with the Registrar of Companies within thirty days from the date of receipt of a copy of this order.
Co.P. Nos. 131/2008 & 2/2009 allowed.