IN RE: SATYAM COMPUTER SERVICES LTD. Vs. STATE

JUDGEMENT

(1.) This is an application (C.P. No. 123 of 2012) filed under sections 391 and 394 of the Companies Act, 1956 (for brevity "the Act") for approval of the scheme of amalgamation and arrangement. The petitioner is Satyam Computer Services Ltd. (SCSL). As per the scheme of amalgamation and arrangement between Venturbay Consultants P. Ltd. (hereinafter referred to as "transferor company No. 1"), Satyam Computer Services Ltd. (hereinafter referred to as the "petitioner-company/transferor company No. 2), C and S System Technologies P. Ltd. (hereinafter referred to as "transferor company No. 3"), CanvasM Technologies Ltd. (hereinafter referred to as "transferor company No. 4"), Mahindra Logisoft Business Solutions Ltd. (hereinafter referred to as "transferor company No. 5") (the petitioner-company, transferor company No. 1, transferor company No. 3, transferor company No. 4 and transferor company No. 5 collectively hereinafter referred to as the "transferor companies") and Tech Mahindra Ltd. (hereinafter referred to as "transferee company") wherein it is proposed to merge Venturbay Consultants P. Ltd., the petitioner-company, C and S System Technologies P. Ltd., CanvasM Technologies Ltd., Mahindra Logisoft Business Solutions Ltd., with Tech Mahindra Ltd., and their respective shareholders and creditors. The petitioner is a leading information communications and technology company has got wide range of expertise and also business nationally and internationally. The other companies and also the transferee company Tech Mahindra Ltd. (TML) also deals with the similar business. The particulars of their investments and the memorandum and articles of association have been given in detail in the application. The scheme of amalgamation is said to be for the following advantages:

(2.) It was felt that the scheme of amalgamation and arrangement would not affect the employees of either companies and it is in the interest of both the companies of their respective shareholders. A detailed scheme of amalgamation is also incorporated in the petition. The scheme of amalgamation was approved by the board of directors on March 21, 2012 and there is no conflict of interest or personal interest of the directors and in fact the three (3) directors of the company are nominees of the transferor company No. 1. These three directors have abstained from voting at the board meeting held for approval of the scheme. The company is a listed company and the BSE and NSE have given no objection for the scheme of amalgamation.

(3.) It was further pleaded that the former chairman of the petitioner-company Sri B. Ramalinga Raju, his brother and family members held shares in SSR Holding P. Ltd., controlled by them and also in the petitioner-company. They have got about 8.27 per cent of issued capital by December 12, 2008. On January 7, 2009, certain disclosers were made by the then chairman Sri B. Ramalinga Raju with regard to fudging of the accounts and irregularities in conducting the business and he has stepped down as chairman. The Company Law Board in C.P. No. 1 of 2009 suspended the entire board with immediate effect. On January 9, 2009, a fresh board was constituted with some of the nominated members and also chartered accountants and solicitors. Forensic investigation was also directed to be undertaken. The CBI has taken up investigation and Serious Fraud Investigation Office (SFIO) and the SEBI have also taken up investigation. The CBI filed a charge sheet against the former promoters. SFIO has also started investigation into seven cases and the petitioner compounded the offences. The petitioner has also settled with the Security Exchanges Commission, USA by paying 10 million dollars.