2016 (12) TMI 1095 - HC - Companies Law

Scheme of Amalgamation - Held that - No impediment to the grant of sanction to the Scheme. Consequently, sanction is hereby granted to the Scheme under sections 391 to 394 of the Act. The Transferor Company/Petitioner will however, comply with the statutory requirements, in accordance with law. A certified copy of this order, sanctioning the Scheme, be filed with the ROC, within thirty (30) days of its receipt. Resultantly, it is hereby directed that the Transferor Company/Petitioner will comply with all provisions of the Scheme and, in particular, those which are referred to hereinabove.

Summary

Issues:
1. Approval of Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956.
2. Jurisdiction of the Court over the petition.
3. Details of the Transferor and Transferee Companies.
4. Share capital structure of both companies.
5. Approval process and resolutions by the Board of Directors.
6. Objections raised by the Regional Director and responses.
7. Observations by the Official Liquidator and responses.
8. Compliance with statutory requirements and objections.
9. Grant of sanction to the Scheme and directions for compliance.
10. Dissolution of the Transferor Company.
11. Clarifications on exemptions, charges, and costs.

Analysis:

1. The petition sought approval of the Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956, filed by the Transferor Company to merge with the Transferee Company. The Scheme aimed at pooling resources, creating synergies, and achieving economies of scale.

2. The Court established its jurisdiction as both the Transferor and Transferee Companies were based in New Delhi, falling under its territorial jurisdiction.

3. Details regarding the incorporation of the Transferor and Transferee Companies, along with their share capital structures, were provided in the judgment to establish their legal standing and financial positions.

4. The resolutions passed by the Board of Directors of both companies were presented, indicating the approval process and compliance with internal corporate governance requirements.

5. Objections raised by the Regional Director and Official Liquidator were addressed by the parties, ensuring clarity on the Scheme's provisions, including the Appointed Date and compliance with regulatory requirements.

6. The Court considered the responses to objections and observations, concluding that there were no remaining impediments to granting sanction to the Scheme under Sections 391 to 394 of the Act.

7. Sanction was granted to the Scheme, with directions for compliance with statutory requirements and procedures, ensuring the Transferor Company's dissolution without winding up.

8. Clarifications were provided regarding exemptions, charges, and costs, emphasizing compliance with legal obligations and the deposit of costs to the Bar Association Fund.

In conclusion, the judgment approved the Scheme of Amalgamation, provided directions for compliance, and clarified legal obligations and costs, ensuring the dissolution of the Transferor Company in accordance with the law.