IN THE HIGH COURT OF DELHI AT

SUBJECT : COMPANIES ACT

COMPANY JURISDICTION

COMPANY PETITION No.247/2007

DATE OF DECISION: 14.01.2008

In the matter of the companies Act, 1956:

And

Application under Sections 391-394 of the Companies Act, 1956

Scheme of Arrangement and Demerger of:

M/s English Indian Clays Limited (EICL)..... Transferor/Non Petitioner Company

And

M/s Bharat Products Limited (BSPL)...... Resulting/Transferee/ Petitioner Company Through : Mr. Deepak Diwan, Advocate for the petitioner Counsel for the Regional Director Ms.Manisha Tyagi for the O.L.

VIPIN SANGHI, J. (ORAL)

1. This is a petition filed under Sections 391-394 of the Companies Act for sanction of the scheme of arrangement/demerger between the English Indian Clays Limited (EICL), the non- petitioner company and Bharat Starch Products Limited (BSPL) the resulting/petitioner company. Vide order dated 21.9.2007 this Court had dispensed the petitioner company from convening/conducting and holding of meeting of the equity shareholders/creditors. The High Court vide order dated 23.8.2007 had directed the non-petitioner company/transferor company to convene the meeting of its equity shareholder on 10.10.2007 at 11 a.m. at the office of the company at TC-79/4, Veili, 695 021 and had also dispensed with the convening and holding of the meeting of the creditors.

2. Meeting of the equity shareholders was called and attended and the scheme was approved unanimously by the shareholders present and voting.

3. Notice of the scheme was issued to the official liquidator and the regional director and neither have filed any objection to the scheme.

4. The notice of the petition was advertised in `The Statesman' (English) and `Dainik Jagran' (Delhi) on 4.12.2007 and affidavit in this respect along with the publication has been placed on record.

5. The circumstances, reasons and grounds justifying and necessitating the scheme of arrangement and demerger are stated as follow: i)Demerger of the Investments Division would enable EICL to focus on and enhance its core business operation by streamlining operations and cutting costs. ii)The scheme will enable both EICL and BSPL to rationalize and streamline their management, businesses and finances and to eliminate duplication of work to their respective advantage. iii) The scheme is beneficial to both the companies, their shareholders, creditors, employees and all stakeholders and will enable both companies to achieve and fulfill their objectives more efficiently and economically. The scheme will contribute in furthering and fulfilling the objects of the both companies and in the growth and development of their business.

6. It is further stated that the manufacturing division of the demergered/transferor/non- petitioner has no synergies whatsoever with the investment division.

7. It is also stated that during the negotiations with collaborators/financiers/ bankers for advancement of the core business activities, the collaborators/bankers have insisted that the non core activities i.e the investment division should be hived off. This has resulted in loss of opportunities and has hurt business plans of the company.

8. The transfer/appointed date under the Scheme is 1.4.2007. Consequently sanction is hereby granted to the scheme of arrangement/demerger under Sections 391-394 of the Companies Act, 1956.

9. Certified copy of the order be filed with the Registrar of Companies within 30 days. It is clarified that this order will not be construed as an order granting exemption from payment of stamp duty, that is payable in accordance with law upon sanction become effective and from the appointed date the scheme would come into existence.

10. Cost of Rs.5000/- be paid by the petitioner into the Common Pool Fund of the O.L. With the aforesaid directions petition stands disposed of. Dasti.

Sd./- VIPIN SANGHI,J

January 14, 2008