2020 (10) TMI 640 - Tri - Companies Law

Approval of the Scheme of Amalgamation - Sections 230 and 232 of the Companies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 and the National Company Law Tribunal Rules, 2016 - HELD THAT - Upon considering the approval accorded by the members and creditors of the Petitioner companies to the proposed Scheme, and the report filed by the Regional Director, Northern Region, Ministry of Corporate Affairs, report filed by the official liquidator and also as no objection from any quarter against the Scheme has been received; 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. Scheme approved - application allowed.

Summary

Issues:
Approval of Scheme of Amalgamation under Sections 230 and 232 of the Companies Act, 2013.

Analysis:
The joint application was filed by the transferor companies and the transferee company for the approval of the Scheme of Amalgamation under Sections 230 and 232 of the Companies Act, 2013. The Scheme aimed to merge Transferor Company No. 1 and Transferor Company No. 2 into the Transferee Company. The First Motion application seeking dispensation from convening meetings of Shareholders and Creditors was approved by the Principal Bench. Meetings of unsecured creditors were held and the Scheme was unanimously approved. Subsequently, necessary publications and notices were carried out as directed by the Tribunal.

The Regional Director, Official Liquidator, and Income Tax Department submitted their reports and observations regarding the Scheme. The Regional Director confirmed compliance with annual returns and no objections were raised. The Official Liquidator did not raise any material objection, and the Income Tax Department did not respond within the specified time frame. Despite this, the Tribunal clarified that the Income Tax Department retains the right for recovery of pending dues.

The Tribunal emphasized that it does not interfere with corporate decisions approved by shareholders and creditors unless necessary. The judgment cited the case of Hindustan Lever Employees Union Vs. Hindustan Lever Limited to highlight the limited jurisdiction of the court in such matters. The Scheme was found to be in the interest of all parties involved, and as there were no objections received, the Tribunal granted sanction to the Scheme under Sections 230 to 232 of the Companies Act, 2013.

The Tribunal ordered the dissolution of the Transferor Companies without winding-up, transfer of assets and liabilities to the transferee company, continuation of pending proceedings, and seamless transition of employees to the transferee company. The Petitioners were directed to comply with statutory requirements, and any deficiencies or violations would not impede legal actions. The order did not exempt the payment of stamp duty, taxes, or other charges, emphasizing compliance with all legal obligations. The Tribunal further issued specific directions regarding the transfer of companies and invited interested parties to seek necessary directions from the Tribunal if required.