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2020 (1) TMI 1246 - Tri - Companies LawApproval of the Scheme of Arrangement by way of amalgamation - Sections 230 to 232 of the Companies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 and the National Company Law Tribunal Rules, 2016 - convening/dispensing with various meetings - HELD THAT - Right to apply for the sanction of the Scheme has been statutorily provided under Section 230-234 of the Companies Act, 2013 and therefore, it is open to the applicant companies to avail the benefits extended by statutory provisions and the Rules - It has also been affirmed in the petition that the Scheme is in the interest of the transferor company and the transferee company including their shareholders, creditors, employees and all concerned. Certificates of respective Statutory auditors of the both the petitioner companies have been placed on record to the effect that Accounting Treatment proposed in the Scheme of Arrangement is in conformity with the Accounting Standard notified by the Central Government as specified under the provisions of Section 133 of the Companies Act, 2013. Thus, upon considering the approval accorded by the members and creditors of the Petitioner companies to the proposed Scheme, and the affidavits filed by the Regional Director, Northern Region, Ministry of Corporate Affairs and the report of official liquidator, there appears to be no impediment in sanctioning the present Scheme - sanction is hereby granted to the Scheme under Section 230 to 232 of the Companies Act, 2013. Approval granted.
Issues involved:
1. Approval of Scheme of Arrangement by way of amalgamation under Sections 230 to 232 of the Companies Act, 2013. 2. Compliance with statutory requirements and objections raised by regulatory authorities. 3. Observations and reports from Regional Director, Official Liquidator, and Income Tax Department. 4. Fairness, justness, and reasonableness of the Scheme. 5. Dissolution of Transferor Companies and transfer of assets, liabilities, and employees to the transferee company. Detailed Analysis: 1. The Joint Application filed by the Petitioner Companies sought approval of the Scheme of Arrangement through amalgamation under Sections 230 to 232 of the Companies Act, 2013. Initially, directions for convening/dispensing with meetings of Shareholders and Creditors were granted. Compliance with publication and service requirements was affirmed through affidavits and reports. 2. The Regional Director raised concerns regarding compliance with fee payment on revised authorized share capital. The Petitioner Companies undertook to address these concerns. The Official Liquidator reported no material objections to the Scheme, while the Income Tax Department highlighted pending demands. 3. The Petitioner Companies responded to Income Tax demands, clarifying payment status and future liabilities. The Tribunal emphasized the importance of statutory compliance and affirmed no pending proceedings against the Petitioner Companies. 4. The Tribunal referenced legal precedents emphasizing its role in evaluating the Scheme's fairness, justness, and reasonableness. It highlighted the statutory provisions allowing companies to seek sanction for the Scheme and affirmed the Scheme's interest for both companies and stakeholders. 5. Following thorough consideration of member and creditor approvals, reports from regulatory authorities, and auditor certificates, the Tribunal granted sanction to the Scheme under Sections 230 to 232 of the Companies Act, 2013. The Petitioners were directed to comply with statutory requirements and warned against violations. 6. The Tribunal ordered the dissolution of Transferor Companies without winding-up, transfer of assets, liabilities, and employees to the transferee company, continuation of pending proceedings, and registration with the Registrar of Companies. Interested parties were allowed to seek necessary directions. This comprehensive analysis covers the key issues and details of the judgment, outlining the process, compliance requirements, regulatory observations, and the final decisions made by the Tribunal.
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