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2020 (10) TMI 16 - Tri - Companies LawSanction of Scheme of Amalgamation - section 230 to 232 of Companies Act - HELD THAT - Right to apply for the sanction of the Scheme has been statutorily provided under Section 230-234 of the Companies Act, 2013 and therefore, it is open to the applicant companies to avail the benefits extended by statutory provisions and the Rules - It has also been affirmed in the petition that the Scheme is in the interest of all the transferor companies and the transferee company including their shareholders, creditors, employees and all concerned. Upon considering the approval accorded by the members and creditors of the Petitioner companies to the proposed Scheme, and the affidavits filed by the Regional Director, Northern Region, Ministry of Corporate Affairs and the report of official liquidator, there appears to be no impediment in sanctioning the present Scheme - sanction is hereby granted to the Scheme under Section 230 to 232 of the Companies Act, 2013.
Issues:
1. Compliance with statutory requirements for Scheme of Amalgamation. 2. Approval of the Scheme under Sections 230-232 of the Companies Act, 2013. 3. Dissolution of Transferor Companies and transfer of assets, liabilities, and employees to the Transferee Company. Compliance with Statutory Requirements for Scheme of Amalgamation: The Tribunal reviewed the compliance of the Transferor and Transferee Companies with the statutory requirements for the Scheme of Amalgamation. The Petitioners filed an affidavit affirming their compliance with the Tribunal's order, including newspaper publications and serving notices to relevant authorities. Reports from the Regional Director and Official Liquidator indicated no objections or issues with the proposed Scheme. The Income Tax Department also expressed no objections during the oral hearing. Additionally, statutory auditors confirmed that the Accounting Treatment in the Scheme aligned with prescribed standards. Approval of the Scheme under Sections 230-232 of the Companies Act, 2013: The Tribunal emphasized the importance of shareholder and creditor approval in Scheme evaluation. Referring to legal precedents, the Tribunal highlighted that its role is to ensure the fairness, justness, and reasonableness of the Scheme, without interfering with corporate decisions approved by stakeholders. The Tribunal noted that the Scheme was in the best interest of all companies involved and their stakeholders. Considering the approvals received and the reports from regulatory bodies, the Tribunal found no impediment in sanctioning the Scheme under Sections 230-232 of the Companies Act, 2013. Dissolution of Transferor Companies and Transfer of Assets, Liabilities, and Employees: Upon granting sanction to the Scheme, the Tribunal ordered the dissolution of the Transferor Companies without winding-up procedures. It directed the transfer of all assets, rights, powers, liabilities, and duties of the Transferor Companies to the Transferee Company. The Tribunal specified the continuation of pending proceedings by or against the Transferee Company. Furthermore, it mandated the seamless transfer of employees from the Transferor Companies to the Transferee Company without any break in service and on favorable terms. The Tribunal outlined detailed steps for registration, consolidation of company files, and provided avenues for interested parties to seek necessary directions. In conclusion, the Tribunal approved the Scheme of Amalgamation, emphasizing compliance with statutory requirements, shareholder and creditor approvals, and seamless transfer of assets and employees. The detailed order covered dissolution procedures, transfer of rights and liabilities, and outlined post-approval actions to be taken by the Petitioner companies.
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