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2020 (9) TMI 704 - Tri - Companies LawApproval of Scheme of Merger by Absorption - Section 230 to 232 of the Companies Act, 2013 - HELD THAT - From the material on record, the Scheme appears to be fair and reasonable and is not in violation of any provisions of law or contrary to public policy - Since all the requisite statutory compliances have been fulfilled, the Company Scheme Petition No. 3420 of 2019 filed by the Petitioner Companies is made absolute in terms of prayer Clause 26(a) to 26(c) of the Company Scheme Petition. The Petitioner Companies are further directed to file a copy of this Order along with a copy of the Scheme with the concerned Registrar of Companies, electronically in e-Form INC-28, within 30 days of the receipt of copy of this Order - The Petitioner Companies are directed to lodge a copy of this Order and the Scheme duly certified by the Deputy or Assistant Registrar, National Company Law Tribunal, Mumbai Bench, Mumbai with the concerned Superintendent of Stamps, for the purpose of adjudication of stamp duty payable, if any, on the same, within 60 days from the receipt of the Order.
Issues:
1. Objections raised by an unsecured creditor regarding a Scheme of Merger by Absorption. 2. Sanction sought under Sections 230 to 232 of the Companies Act, 2013 for the proposed Scheme. 3. Compliance with statutory requirements and reports filed by Official Liquidator and Regional Director. Analysis: Issue 1: An unsecured creditor objected to a Scheme of Merger by Absorption, citing concerns about the transfer of liabilities affecting their rights from an arbitration award. The creditor's objections were countered by the Petitioner Companies, stating the outstanding dues and legal proceedings pending at the District and Sessions Court. The Petitioner argued that the creditor's claim was less than 5% of total outstanding dues, thus lacking locus standi under Section 230(4) of the Companies Act, 2013. It was emphasized that the Tribunal proceedings were not for recovery, and the Petitioner undertook to honor civil dispute outcomes. Issue 2: The Petitioner Companies sought the Tribunal's sanction for the Scheme of Merger by Absorption under Sections 230 to 232 of the Companies Act, 2013. The Companies had passed Board Resolutions approving the Scheme, aiming to consolidate group entities for business efficiency and synergy. The merger was deemed commercially viable, beneficial to stakeholders, and compliant with legal requirements. The Petitioners assured compliance with statutory obligations and undertook to adhere to accounting standards and other regulations. Issue 3: Reports from the Official Liquidator and Regional Director were submitted. The Official Liquidator confirmed proper conduct of the Transferor Company's affairs, recommending dissolution. The Regional Director's report highlighted compliance requirements, including accounting entries, appointed date, Real Estate Regulation Act applicability, and notices to concerned authorities. The Petitioner Companies responded to each observation, providing clarifications and undertakings, which were accepted by the Tribunal. The Regional Director's supplementary report deemed the Petitioner's replies satisfactory. In conclusion, the Tribunal found the Scheme fair, reasonable, and in compliance with legal provisions. With all statutory compliances fulfilled, the Company Scheme Petition was granted, directing the filing of the Order and Scheme with relevant authorities. Regulatory bodies were instructed to act on the Order, and interested parties were given the liberty to seek further directions from the Tribunal if needed.
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