2016 (2) TMI 2 - HC - Companies Law

Scheme of Amalgamation is sanctioned. It is, however, directed that the petitioner Transferor Companies shall preserve their books of accounts, papers and record and shall not dispose of the records without the prior permission of the Central Government under Section 396A of the Companies Act, 1956.

Summary

Issues:
1. Sanction of Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956.
2. Dispensation of meetings of Equity Shareholders and Creditors for Transferor and Transferee Companies.
3. Observations by Regional Director and Official Liquidator regarding valuation report, compliance with RBI guidelines, and Income Tax Department comments.
4. Responses to observations by the petitioner companies and actions taken.
5. Sanction of the Scheme of Amalgamation by the Court.
6. Directions regarding preservation of records, payment of costs, stamp duty adjudication, filing with authorities, and issuance of drawn-up order.

Detailed Analysis:

1. The petitions sought the sanction of the Court for the Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956, involving multiple Transferor Companies merging with Echjay Industries Private Limited and their respective shareholders and creditors.

2. The Court ordered dispensation of meetings of Equity Shareholders for the Transferor and Transferee Companies based on separate applications filed by each company, citing reasons such as being a Transferee Company or having no creditors.

3. The Regional Director and Official Liquidator raised observations regarding the valuation report, compliance with RBI guidelines, and comments from the Income Tax Department. The Regional Director requested compliance with Income Tax Act and Rules, while the Official Liquidator sought clarification on TDS differences.

4. The petitioner companies responded to the observations, providing details on valuation reports, compliance with RBI guidelines until dissolution, and actions taken regarding Income Tax compliance and TDS differences, ensuring no adverse impact on members or public interest.

5. After considering all reports, responses, and relevant documents, the Court found it appropriate to grant sanction to the Scheme of Amalgamation, directing the Transferor Companies to preserve records and not dispose of them without prior permission.

6. The Court sanctioned the Scheme of Amalgamation, determined costs payable to authorities, directed preservation of records, adjudication of stamp duty, filing with authorities, and dispensed with the issuance of drawn-up order, concluding the disposal of the petitions.