2020 (5) TMI 40 - Tri - Companies Law

Sanction of scheme of amalgamation - transfer of business of the transferor company and all the properties, assets, rights and claim to the transferee company - sections 230(1) and 232 of the Companies Act, 2013 - HELD THAT - In compliance with the order dated August 1, 2019 the petitioner-companies have filed affidavit of service affirmed on October 9, 2019 evidencing service of notice upon the Central Government through the Regional Director NER, Ministry of Corporate Affairs, Registrar of Companies, Shillong, Official Liquidator, Income-tax Department, Reserve Bank of India, by speed post and through hand delivery at their respective addresses - it is also revealed that the Regional Director, NER Ministry of Corporate Affairs has furnished his response by way of affidavit dated September 6, 2019 and has made observation in paragraph 2 stating, inter alia, therein that they have no objection to the proposed scheme of amalgamation - On further perusal of the record has revealed that the official liquidator pursuant to provisions of sections 230 to 232 of the Companies Act, 2013 read with rule 16 of the Companies (Compromise, Arrangement and Amalgamations) Rules, 2016 in respect of the petitioner/transferor company has furnished his response by way of affidavit on August 9, 2019 and has made observation in stating, inter alia, therein that he has no objection to the proposed scheme of amalgamation. In the view of the facts stated above in absence of any objection from the authorities concerned and since the requisite compliances have been fulfilled, the scheme of the amalgamation mentioned in this petition is sanctioned by this Bench to be binding with effect from April 1, 2018 on the transferor company and their shareholders and all concerned - petition disposed off.

Issues Involved:
1. Sanction of the scheme of amalgamation.
2. Compliance with statutory requirements.
3. Observations and objections by regulatory authorities.
4. Transfer of properties, rights, and liabilities.
5. Continuation of legal proceedings.
6. Allotment and cancellation of shares.
7. Dissolution of transferor companies.

Detailed Analysis:

1. Sanction of the Scheme of Amalgamation:
The application was filed by Sandeep Commercial P. Ltd. (transferee) with Arthyug Advisory Ltd. (transferor No. 1) and Purbanchal Advisory Services P. Ltd. (transferor No. 2) under sections 230(1) and 232 of the Companies Act, 2013. The objective was to obtain sanction for the scheme of amalgamation, transferring the business and properties of the transferor companies to the transferee company.

2. Compliance with Statutory Requirements:
The board of directors of the petitioner companies approved the scheme on December 31, 2018. The proposed scheme aimed at strengthening the financial and operational structure, achieving economies of scale, and benefiting shareholders. No proceedings were pending against any applicant companies, and there were no secured or unsecured creditors, negating the need for separate meetings.

3. Observations and Objections by Regulatory Authorities:
Notices were sent to relevant authorities, including the Central Government, Regional Directors, Registrar of Companies, Income-tax Department, and Reserve Bank of India. The Regional Director, NER, affirmed no objections to the scheme, stating no prosecution or complaints were filed against the petitioner companies. The official liquidator also had no objections, confirming the scheme did not prejudice the interests of members or the public.

4. Transfer of Properties, Rights, and Liabilities:
All properties, rights, and interests of the transferor companies were to be transferred to the transferee company without any further act or deed, pursuant to section 232 of the Companies Act, 2013. This included all debts, liabilities, duties, and obligations.

5. Continuation of Legal Proceedings:
All pending legal proceedings by or against the transferor companies were to be continued by or against the transferee company.

6. Allotment and Cancellation of Shares:
The scheme did not envisage any allotment of new shares, as the paid-up share capital of the transferor companies would be canceled against the investment of the transferee company. However, the authorized share capital of the transferee company would increase by the authorized capital of the transferor companies without any fee payment.

7. Dissolution of Transferor Companies:
The transferor companies, Arthyug Advisory Ltd. and Purbanchal Advisory Services P. Ltd., were to be dissolved from the appointed date, April 1, 2018. Certified copies of the order were to be delivered to the Registrar of Companies, Guwahati, within 30 days for registration.

Conclusion:
The Tribunal sanctioned the scheme of amalgamation, ensuring all statutory compliances were met. The properties, rights, and liabilities of the transferor companies were transferred to the transferee company, and all pending legal proceedings were to continue under the transferee company. The transferor companies were dissolved, and the authorized share capital of the transferee company was increased accordingly. The company petition was disposed of, and certified copies of the order were to be issued upon compliance with requisite formalities.

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