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2016 (2) TMI 686 - HC - Companies LawScheme of Amalgamation - Held that - Having heard Mr. Bharat T Rao, learned advocate for the petitioner Companies and Mr. Kshitij Amin, learned Central Government Standing Counsel for Mr. Devang Vyas, learned Assistant Solicitor General of India for the Regional Director and upon perusal of the reports of the Official Liquidator and the Regional Director and after considering the Scheme of Amalgamation, together with the relevant documents on record, this Court finds it appropriate to grant sanction to the present Scheme of Amalgamation. In view of the above, the Scheme of Amalgamation is sanctioned. It is, however, directed that the petitioners shall preserve their books of Accounts, papers and records and shall not dispose of the records without the prior permission of the Central Government under Section 396A of the Companies Act,1956. The petitioner shall further ensure statutory compliance of all applicable laws. On the sanctioning of the Scheme of Amalgamation, the Petitioner Companies shall not be absolved of any of their statutory liabilities. The petitioner Companies shall lodge a copy of this order, the schedule of immovable assets of the petitioner-companies as on the date of this order and the Scheme, duly authenticated by the Registrar, High Court of Gujarat, with the concerned Superintendent of Stamp Duty, if any, on the same within sixty (60) days from the date of the order.
Issues:
Petitions filed under Sections 391 to 394 of The Companies Act, 1956 for sanction of the Scheme of Amalgamation of three companies. Observations by the Regional Director regarding compliance with Accounting Standards, preference shareholders' meeting, and Income Tax Department. Reports by the Official Liquidator recommending preservation of books of account. Granting of sanction to the Scheme of Amalgamation with specific directions. Analysis: The petitions were filed seeking the sanction of the Court for the Scheme of Amalgamation involving three companies under Sections 391 to 394 of The Companies Act, 1956. The Transferee Company had earlier filed an application for dispensation of the meeting of Equity Shareholders, which was allowed by the Court. Similar applications were filed by the other two Transferor Companies, and dispensation was granted due to written consent from shareholders and creditors. Subsequently, the petitions seeking sanction of the Scheme of Amalgamation were admitted by the Court, and notices were issued to the Regional Director and Official Liquidator. The notice of the hearing was published in local newspapers as directed by the Court. The Regional Director raised observations regarding compliance with Accounting Standards, preference shareholders' meeting, and Income Tax Department requirements. The Court noted that while preference shareholders had given consent, there was an oversight in informing the Chartered Accountant. The Director of the Transferee Company apologized for the oversight and provided necessary documents. The Court also considered reports from the Official Liquidator confirming no prejudicial conduct in the affairs of the Transferor Companies. After hearing arguments from the advocates of the petitioner Companies and the Central Government Standing Counsel, and reviewing the reports of the Official Liquidator and Regional Director, the Court found it appropriate to grant sanction to the Scheme of Amalgamation. The Court directed the petitioners to preserve their books of accounts, ensure statutory compliance, and not absolve them of their statutory liabilities post-amalgamation. Specific directions were given regarding the preservation of records and compliance with laws. The Court ordered the petitioners to lodge necessary documents with the concerned authorities within a specified timeframe, file copies of the order with relevant authorities, and dispensed with the filing and issuance of drawn-up orders. Costs of the petitions were determined and directed to be paid to the Central Government and the Official Liquidator. The petitions were disposed of accordingly, concluding the legal judgment.
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