RANGKALA INVESTMENTS LIMITED Vs. GUJARAT ORGANICS LIMITED

JUDGEMENT

(1.) These two petitions are submitted by the petitioners for obtaining sanction of the scheme of amalgamation as per Annexure-B in Company Petition No. 47 of 1994 and at Annexure-C in Company Petition No. 48 of 1994 by virtue of provision contained in Secs. 391, 392 and 394 of the Companies Act, 1956 (for short 'the Act').

(2.) The Petitioner in Company Petition No. 48 of 1994, namely, Gujarat Organics Limited is the transferor company and the petitioner in Company Petition No. 47 of 1994, namely, Rangkala Investments Limited is the transferee company. They are accordingly referred to as 'the transferor company' and the 'transferee company' respectively in this judgment. The transferor company is sought to be amalgamated with transferee company.

(3.) The reasons for the proposed amalgamation are more particularly set out in both the petitions. Accordingly the transferor company is a subsidiary of the transferee company, which has the holding to the extent of 97.58% of the paid up equity share capital of the transferor company. Bearing in mind this glaring fact it was thought advantageous to combine the activities of both the companies with a view to carrying on the same in a single company. The idea is to economise and run the company efficiently. The proposed amalgamation would also result in enlarging the activities of the transferee company which would be conducive to avoidance of duplication and reduction in administration costs and other overhead expenses. It would also result in the optimum utilisation of the management and other resources. For all these reasons the proposed amalgamation has been sought to be sanctioned by this Court.