2020 (11) TMI 162 - Tri - Companies Law

Sanction of Scheme of Amalgamation - sections 230 to 232 of the Companies Act, 2013 - HELD THAT - Directions regarding various meetings to be held and to be convened are issued - directions regarding service of notices issued - scheme sanctioned.

Summary

Issues:
1. Approval of Scheme of Amalgamation under Companies Act, 2013
2. Dispensation of meetings of Equity Shareholders, Unsecured Creditors, and Secured Creditors
3. Compliance with regulatory authorities and Official Liquidator

Analysis:
1. Approval of Scheme of Amalgamation under Companies Act, 2013:
The judgment pertains to a Scheme of Amalgamation between two companies, namely Transferor Company and Transferee Company, as approved by their respective Board of Directors. The Scheme aims at amalgamating Satmetrix Software and Systems India Private Limited with Nice Interactive Solutions India Private Limited and their shareholders under sections 230 to 232 of the Companies Act, 2013. The benefits of the proposed amalgamation include a reduction in the number of entities, decreased administrative costs, and enhanced operational and management efficiency.

2. Dispensation of meetings of Equity Shareholders, Unsecured Creditors, and Secured Creditors:
The Counsel for the Applicant Companies sought dispensation of the meetings of Equity Shareholders and Unsecured Creditors of the Transferor Company, citing consent affidavits and the fact that the Transferor Company is a wholly owned subsidiary of the Transferee Company. The judgment highlights that no new shares would be issued or allotted as consideration, leading to no dilution in the shareholding of the Transferee Company. It was further emphasized that the Scheme does not affect the rights and interests of the shareholders and creditors of the Transferee Company, and no reconstruction or arrangement with shareholders or creditors is proposed.

3. Compliance with regulatory authorities and Official Liquidator:
The judgment mandates compliance with regulatory authorities by serving notices to the Central Government, Registrar of Companies, and Income Tax Authorities. It also directs the Transferor Company to serve notice upon the Official Liquidator, who may file objections. Additionally, a Chartered Accountant is appointed to assist the Official Liquidator in scrutinizing the books of accounts of the Transferor Company. The judgment requires the Applicant Companies to file a compliance report with the registry in lieu of an affidavit of service due to the prevailing lockdown situation.

This comprehensive judgment addresses various aspects of the Scheme of Amalgamation, including dispensation of meetings, compliance requirements with regulatory authorities, and the role of the Official Liquidator in ensuring transparency and adherence to legal procedures.