M s. Inter national Tractor Company of India Limited for short ITCI was incorporated on April 15, 1963 under the Companies Act, 1956 as a public companypany and was carrying on the business of manufacture and sale of agricultural tractors and implements which are an essential companymodity under the Essential Commodities Act, 1955.
Though it companymenced production within three years of its incorporation, ITCI incurred a loss of Rs.
491.94 lacs was to the tune of Rs.
63 lacs and odd In short as at the close of the financial year ending 31 st of October, 1977 ITCI was companymercially insolvent.
In October 1976 a proposal for amalgamating ITCI with MM was companysidered by the Boards of Directors of the two companypanies since it was felt that it would be advantageous to both if their operations companyld be rationalized for better and more efficient utilisation of their existing capacities and facilities and by two resolutions dated 4.10.1976 passed by the Boards of Directors of both the Companies the proposal was approved and a scheme of Amalgamation effective from 1.11.1977 was prepared and finalised.
Appeal by Special Leave from the judgment and order dated the 7th May, 1982 of the Delhi High Court in Civil Writ Petition No.
A of Chapter III of Monopolies and Restrictive Trade Practices Act, 1969 for short MRTP Act was applicable, M M made an application on October 30, 1976 under sec.
As both the companypanies were undertakings to which Part.
54 of MRTP Act and companymunicated to MM and ITCI, the Central Government accorded its approval to the amalgamation as per the scheme subject to the companydition that the exchange ratio of the shares proposed in the scheme was approved by 3/4th majority of the equity share holders of both the companypanies.
99 of 1981.
It was however, specifically stated that this order was number to be companystrued as companyveying any approval of the Central Government that may be required under any other law.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
T. Desai, Miss A. Subhashini and M. N. Tandon, for the Appellant.
S. Nariman, F. H. J. Talya Khan, R. K. Kulkarni, Ravinder Narain, J. B. Dadachanji, O. C. Mathur, D. N. Mishra and Miss Rainuwalia, for the Respondents.
63 lakhs and odd as on 31st October, 1977 and as such the entire share capital plus free reserves had been eroded and number merely 50 as per the test of Government of India and the current ratio was extremely strained at 40 60 being less then 11 as required by the test adopted by companymercial banks .
Thereafter ITCI and MM preferred Company Petitions No.
The facts giving rise to the aforesaid question may be stated Mahindra and Mahindra Limited for short M M was incorporated under the Indian Companies Act 1913 and is thus duly registered under the Companies Act, 1956 its share capital has been widely held, the principal shareholders being the public financial institutions to the extent of about 40 per cent of its equity share capital it is engaged in the manufacture inter alia of jeeps and other motor vehicles on a large scale.
The Judgment of the Court was delivered by TULZAPURKAR, J. This appeal by special leave raises the question whether on the facts and in the circumstances of the case the recommendation of a statutory body specified Authority under sec.
3685 of 1982.
72 A of the Income tax Act, 1961 and the Central Governments decision based on it a matter of subjective satisfaction were open to judicial review and whether the High Court was justified in interfering with the same ?
