BIRLA VXL LIMITED Vs. STATE

JUDGEMENT

(1.) The applicant, namely, Birla VXL Limited has taken out this Judge's Summons praying for direction for convening the meeting of Unsecured Creditors of OCM Division of the applicant Company, being transferred to OCM (India) Limited for the purpose of considering and if thought fit, approving with or without modification, the Scheme of Arrangement between the applicant Company and its Existing Lenders, Creditors and Shareholders and OCM India Limited and its Shareholders. The applicant has also prayed for the extension of the period for filing Company Petition in terms of Rule 79 of the Companies (Court) Rules, 1959 for a period of 7 days from the date of filing Chairman's report of the meeting of the Unsecured Creditors of OCM Division of the applicant Company in terms of prayer (a) of the Judge's Summons.

(2.) An affidavit is filed by Shri Girish Bhatia, Company Secretary of the applicant Company. Mr. Mihir Thakore & Mr. S.N. Soparkar, learned Senior advocates appearing with Mr. Sandeep Singhi, learned advocate for the applicant have submitted that the applicant had earlier filed Company Application No. 171 of 2005 inter alia praying for convening separate meetings of Existing Lenders, Equity Shareholders, Preference Shareholders and Unsecured Creditors of the applicant Company to consider and if thought fit, approve with or without modification, the said Scheme. This Court vide its order dated 10.05.2005 has disposed of the said application directing to hold separate meetings of the Existing Lenders, Equity Shareholders, Preference Shareholders and Unsecured Creditors of the applicant Company on 25.06.2005 at the Regd. office of the applicant Company. Pursuant to the said order, separate meetings of Existing Lenders, Equity Shareholders, Preference Shareholders and Unsecured Creditors of the applicant Company were held at the Regd. office of the applicant Company on 25.06.2005. The said Scheme was unanimously approved by requisite majority by the Existing Lenders and unanimously by the Equity Shareholders, Preference Shareholders and Unsecured Creditors respectively. The Chairman of the meeting has also filed his report before this Court.

(3.) Mr. Thakore has further submitted that the Scheme proposed does not envisage any compromise or arrangement for all the Unsecured Creditors of the applicant Company. There was no need for the applicant Company to convene the meeting of all the Unsecured Creditors. The Scheme envisages de- merger of the OCM Division of the applicant Company into OCM (India) Limited. For the purpose of considering this de- merger, only a meeting of the Unsecured Creditors of the OCM Division was required to be convened. In Company Application No. 171 of 2005, the applicant Company applied for convening meeting of its Unsecured Creditors without appreciating that the Scheme does not envisage any Compromise or Arrangement with the Unsecured Creditors of the applicant Company other than the Unsecured Creditors of OCM Division, being transferred pursuant to de-merger to OCM (India) Limited.