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2016 (8) TMI 569 - HC - Companies LawScheme of amalgamation is in the interest of its shareholders and creditors as well as in the public interest and the same deserves to be sanctioned and the same is hereby sanctioned.
Issues:
Petitions for sanction of Scheme of Amalgamation under Companies Act, 1956. Analysis: The petitions were filed by two companies, seeking the court's approval for the Scheme of Amalgamation between them under sections 391 to 394 of the Companies Act, 1956. Both companies are part of the same management group and intend to merge for synergic benefits, consolidating resources for stakeholders' advantage financially and administratively. The petitions detailed the benefits expected from the proposed scheme. The Equity Shareholders and Unsecured Creditors meetings of the Transferor Company were dispensed with as all stakeholders provided written consent approving the scheme. Similar consent was obtained from Equity Shareholders of the Transferee Company as there were no Secured Creditors involved. The petitions were admitted on 3rd May 2016, and notices for the hearing were duly advertised in newspapers. No objections were raised by any party post-publication. The Official Liquidator's report confirmed that the Transferor Company's affairs were conducted within its object clauses and not prejudicial to members or public interest. The Transferee Company was directed to preserve Transferor Company's records and comply with statutory liabilities even after the scheme's sanction. The Central Govt. was served notices, and observations made were addressed in subsequent affidavits. The court considered all contentions, undertakings, and submissions and concluded that the amalgamation scheme was in the interest of shareholders, creditors, and the public. The scheme was sanctioned, and related prayers in the petitions were granted. Costs to Central Govt. Standing Counsel and Official Liquidator were quantified and directed to be paid. The petitioner companies were instructed to lodge necessary documents, file orders with concerned authorities, and act promptly on the sanctioned scheme. Overall, the court approved the amalgamation scheme, ensuring compliance with legal provisions and protecting stakeholders' interests.
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