IN THE MATTER OF : INDIA POWER CORPORATION LTD & DPSC LTD Vs. IN THE MATTER OF : INDIA POWER CORPORATION LTD

JUDGEMENT

(1.) This is an application filed by the Securities and Exchange Board of India (SEBI) seeking the following reliefs:-

(2.) Briefly, by an order dtd. 17/4/2013 a scheme of amalgamation was sanctioned by this Court whereby the demerged company Indian Power Corporation Limited (IPCL) was transferred to Power Trust (the Trust), an irrevocable investment Trust and the residual undertaking of the demerged company was merged with Dishergarh Power Supply Corporation Limited (DPSC), the resulting company. Prior to amalgamation, IPCL owned approximately 93% shares in DPSC which had subsequently been transferred to the Trust. Thereafter, under the scheme, the investment division of IPCL was transferred to DPSC.

(3.) It is alleged that, the scheme sanctioned by this Court (in particular clause 3.3.3 of the scheme), violates the mandatory stipulations that all listed companies must have at least 25% of its shares held by the public. This is also in violation of inter alia the Securities Contract Regulation Act, 1956 and the Securities Contract Regulation Rules, 1957. For convenience, clause 3.3.3 of the scheme provides as follows: