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2016 (3) TMI 292 - HC - Companies LawScheme of Amalgamation - Held that - The Official Liquidator has filed separate reports both, dated 23.2.2016, in cases of both the Transferor Companies. The reports confirm that the affairs of the Transferor companies are not conducted in a manner prejudicial to the interest of their members or to the public interest. The Official Liquidator has, however, requested this Court to direct the petitioners to preserve their books of accounts, papers and records and not to dispose of the records without the prior permission of the Central Government u/s. 396A of the Companies Act,1956. Having heard Mr. Navin K Pahwa, learned Counsel for the petitioner companies, 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 having considered the Scheme of Amalgamation together with the relevant documents on record, this Court considers it appropriate to grant sanction to the present Scheme of Amalgamation.
Issues:
1. Sanction of Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956. 2. Compliance with Accounting Standard 14 and other regulatory requirements. 3. Observations and responses regarding the Scheme by the Regional Director. 4. Reports by the Official Liquidator on the affairs of the Transferor Companies. 5. Granting of sanction to the Scheme of Amalgamation and related directions. Analysis: 1. The petitions were filed seeking the sanction of the Court for the Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956, involving Smart Guard Systems Private Limited and nGin Technologies Private Limited with eInfochips Limited. 2. The Holding Company, eInfochips Private Limited, had previously sought an order that no separate proceedings were required under Section 391(2) of the Act, which was granted. Subsequently, petitions were filed for dispensation of meetings of Equity Shareholders and Unsecured Creditors of the Transferor Companies, which were also approved by the Court. 3. The Regional Director raised observations regarding Accounting Treatment, share capital details, correct company names, and compliance with Income Tax regulations. The petitioners responded to each observation, clarifying compliance with Accounting Standard 14, share capital accuracy, correct naming, and commitment to Income Tax Act compliance. 4. The Official Liquidator confirmed that the affairs of the Transferor Companies were not prejudicial to the members or public interest. However, a request was made to preserve books of accounts and records without disposal without prior permission under Section 396A of the Companies Act, 1956. 5. After considering all reports, documents, and submissions, the Court granted sanction to the Scheme of Amalgamation. It directed the preservation of books and records, imposed costs, and instructed the lodgment of necessary documents for stamp duty adjudication. The petitioners were also directed to file copies of the order and Scheme with relevant authorities. In conclusion, the petitions were disposed of with the sanction granted for the Scheme of Amalgamation, subject to specified directions and compliance requirements.
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