2021 (6) TMI 237 - Tri - Companies Law

Approval of scheme of Amalgamation - section 230-232 of Companies Act - HELD THAT - On perusal of the Scheme, reports of the Regional Director, Official Liquidator, and reply/undertakings of the Petitioner Companies thereon and the documents produced on record, the Scheme of Amalgamation appears to be fair and reasonable and is not contrary to public policy and not violative of any provisions of law. All the statutory compliances have been made under Section 230 to 232 of the Companies Act, 2013. The scheme is approved - petition allowed.

Summary

Issues:
- Sanction of proposed Scheme of Amalgamation under Sections 230 to 232 of the Companies Act, 2013
- Dispensation of meetings of Equity Shareholders, Creditors, and Trade/Sundry Creditors
- Approval of Scheme by Tribunal
- Compliance with statutory requirements and observations by Regional Director and Official Liquidator

Analysis:

The Company Petition was filed seeking sanction of the proposed Scheme of Amalgamation between the Petitioner Companies and their shareholders and creditors under Sections 230 to 232 of the Companies Act, 2013. The Tribunal, after considering the details of the Petitioner Companies and their businesses, dispensed with the meetings of Equity Shareholders, Secured, Unsecured Creditors, and Trade/Sundry Creditors of the Transferor Company. However, a meeting of Trade/Sundry Creditors of the Transferee Company was ordered to be convened, which subsequently took place with a significant majority in favor of the Resolution.

The Petitioner Companies then sought sanction of the Scheme with an appointed date of 01.04.2019. The Tribunal admitted the Petition and directed the companies to advertise the notice of the hearing, which was duly done. The rationale for the Scheme included benefits such as reduction of overheads, administrative work, and inefficiencies through amalgamation.

The Official Liquidator and Regional Director submitted reports with observations and recommendations, which were addressed by the Petitioner Companies through undertakings and modifications to the Scheme. The Tribunal, after considering all reports, undertakings, and compliance with statutory requirements, found the Scheme to be fair, reasonable, and in compliance with the law.

Consequently, the Tribunal sanctioned the Scheme of Amalgamation with specific directions, including the effective date, preservation of records, compliance with undertakings, and submission to the Registrar of Companies. The Petitioner Companies were directed to take necessary steps for implementation and compliance with all statutory requirements and undertakings, ensuring transparency and adherence to the Companies Act.

In conclusion, the Tribunal allowed the Company Petition, sanctioning the Scheme of Amalgamation and providing detailed directions for compliance and implementation, thereby disposing of the matter effectively.