2012 (12) TMI 537 - HC - Companies Law

Scheme of Amalgamation - Merger - Application u/s 391,394 of Companies Act - Held that - Representation/reports filed by the Regional Director and the Official Liquidator that no objections of Shareholders and Creditors of the Petitioner Company, received to the proposed Scheme, there appears to be no impediment to grant of sanction to the Scheme - no notice is required to be given to the commission in case of an amalgamation which involves an Holding company and its subsidiaries, which are wholly owned by enterprises belonging to the same group - Sanction is hereby granted to the Scheme u/s 391 and 394 of the Companies Act, 1956 - Petitioner Company will comply with the statutory requirements in accordance with law - Certified copy of the order will be filed with the ROC within 30 days from the date of receipt of the same - Petitioner Company and the property, rights and powers & all the liabilities and duties concerning the same will be transferred to and vest in the Transferee Company without any further act or deed - this order will not be construed as an order granting exemption from payment of stamp duty or taxes or any other charges, if payable in accordance with any law - Petitioner Company would voluntarily deposit a total sum of Rs.1,00,000/- in the Common Pool fund of the Official Liquidator within three weeks from today - Scheme of Amalgamation allowed.

Summary

Issues:
Petition under Sections 391 to 394 of the Companies Act, 1956 for Scheme of Amalgamation between Transferor and Transferee Company.

Analysis:
1. The petition was filed under Sections 391 to 394 of the Companies Act, 1956 by the Transferor Company for a Scheme of Amalgamation with the Transferee Company. The Scheme proposed the merger of the Transferor Company into the Transferee Company. The registered offices of both companies were in different cities, and the High Court of Bombay had already approved the Scheme.

2. Details regarding the incorporation dates, capital structure, and financial accounts of both companies were provided in the petition. Resolutions by the Board of Directors of both companies approving the Scheme were also submitted. No pending proceedings under relevant sections of the Companies Act, 1956 were reported against either company.

3. The share exchange ratio for amalgamation stated that the Transferee Company would not issue any new shares as the Transferor Company was its wholly owned subsidiary. All equity shares held by the Transferee Company in the Transferor Company were to be canceled.

4. Previous court orders had dispensed with the requirement of shareholder and secured creditor meetings for the Transferor Company. A meeting of unsecured creditors approved the Scheme. The petition sought sanction for the Scheme, and notices were issued to relevant authorities.

5. The Official Liquidator's report confirmed no complaints against the Scheme and no objections from interested parties. The Regional Director's observations regarding compliance with RBI and FEMA regulations were addressed with undertakings from both companies.

6. The Regional Director also highlighted the need for Competition Commission of India approval. The petition clarified that no notice was required under certain regulations as the amalgamation involved wholly owned subsidiaries within the same group.

7. No objections were received from any party regarding the Scheme. Sanction was granted under Sections 391 and 394 of the Companies Act, 1956. The Petitioner Company was required to comply with statutory requirements, and the order did not exempt from stamp duty or taxes. The Transferor Company would be dissolved without winding up procedures.

8. The Petitioner Company agreed to deposit a sum in the Official Liquidator's fund voluntarily. The petition was allowed as per the terms mentioned in the judgment.