2016 (5) TMI 643 - HC - Companies Law

Scheme of Amalgamation - Held that - Having heard Mr.Navin K. Pahwa, learned Counsel for the petitioner companies, Mr.Kshitij Amin, learned Central Government Standing Counsel on behalf of Mr.Devang Vyas, learned Assistant Solicitor General of India for the Regional Director and upon perusal of the report of the Regional Director and the report of the Official Liquidator, the reply filed on behalf of the Petitioner Transferee Company and having considered 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. The petitioner Transferor company is directed to preserve its books of accounts, papers and records and not to dispose of the records without prior permission of Central Government as per the provisions of Section 396 (A) of the Companies Act, 1956. The petitioner Transferor company is also directed to ensure all statutory compliance. The cost of these petitions are determined at ₹ 7,500/each payable to Shri Devang Vyas, learned Assistant Solicitor General of India and ₹ 7,500/to the Official Liquidator in the case of the Transferor Company.

Summary

Issues Involved:
1. Sanction of Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956.
2. Dispensation of meetings of Equity Shareholders, Secured Creditors, and Unsecured Creditors.
3. Modification of court orders regarding the meetings of Secured Creditors.
4. Approval of Scheme of Amalgamation by Unsecured Creditors.
5. Admission of Company Petitions seeking sanction of the Scheme.
6. Issuance of notice to Regional Director and Official Liquidator.
7. Compliance with observations regarding Share Exchange Ratio and Income Tax Department.
8. Preservation of books of accounts and statutory compliance by Transferor Company.
9. Sanction of Scheme of Amalgamation and determination of costs.
10. Lodging of order and Scheme for stamp duty adjudication.
11. Filing of order and Scheme with Registrar of Companies.

Analysis:
1. The petitions were filed seeking the sanction of the Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956, involving Centurion Remedies Private Limited and Centurion Laboratories Private Limited. The court directed the dispensation of the meeting of Equity Shareholders while convening meetings of Secured Creditors and Unsecured Creditors.

2. Orders were passed for modification of directions related to the meetings of Secured Creditors, based on the consent of all Secured Creditors in writing. The Scheme of Amalgamation was approved by Unsecured Creditors in meetings held as per court orders.

3. Company Petitions were filed for the sanction of the Scheme, and the court admitted the petitions, directed the issuance of notices to the Regional Director and Official Liquidator, and ordered the publication of notice in newspapers.

4. The Regional Director raised observations regarding the Share Exchange Ratio and the Income Tax Department, to which responses were submitted, including valuation reports and compliance assurances by the petitioner companies.

5. The Official Liquidator made observations concerning the preservation of books of accounts, papers, and statutory compliance by the Transferor Company. After considering all reports and submissions, the court granted sanction to the Scheme of Amalgamation.

6. The court directed the Transferor Company to preserve records, ensure statutory compliance, and determined costs payable to relevant authorities. It mandated the lodging of the order and Scheme for stamp duty adjudication and filing with the Registrar of Companies.

7. Dispensation of drawn-up order was granted, and authorities were instructed to act on authenticated copies. The petitions were disposed of accordingly, concluding the legal proceedings.