2021 (8) TMI 1057 - Tri - Companies Law

Sanction of Scheme of Amalgamation - Section 230(6) read with Section 232(3) of the Companies Act, 2013 - HELD THAT - Various directions regarding holding, convening and dispensation of various meetings issued - directions regarding issuance of notices also issued. The scheme is approved - application allowed.

Issues involved:
1. Scheme of Amalgamation under Sections 230(6) and 232(3) of the Companies Act, 2013.
2. Approval of the Scheme by the Board of Directors.
3. Justification and benefits of the Scheme.
4. Compliance with accounting standards and absence of pending proceedings.
5. Dispensation of meetings of shareholders and creditors.
6. Representations by the Regional Director and Official Liquidator.
7. Sanction of the Scheme by the Tribunal and consequential orders.
8. Dissolution of Transferor Companies and compliance with registration requirements.

Detailed Analysis:

1. Scheme of Amalgamation under Sections 230(6) and 232(3) of the Companies Act, 2013:
The petition sought sanction for the Scheme of Amalgamation involving multiple Transferor Companies merging with a Transferee Company, with the appointed date being 01.04.2018. The Scheme aimed to combine managerial and marketing synergies, streamline administration, and enhance overall business efficiency.

2. Approval of the Scheme by the Board of Directors:
The Scheme was unanimously approved by the Board of Directors of the respective Petitioner Companies at their meetings held on 16th January 2019. The approval highlighted the strategic benefits of the amalgamation in terms of cost savings, operational efficiency, and business growth.

3. Justification and benefits of the Scheme:
Various circumstances justified the Scheme, including achieving cost savings, productivity improvements, and a wider capital base. The Scheme aimed to enhance business stability, profitability, and competitiveness in the market, benefiting the companies, shareholders, and employees.

4. Compliance with accounting standards and absence of pending proceedings:
The Statutory Auditors confirmed the accounting treatment's conformity with prescribed standards under Section 133 of the Companies Act, 2013. Additionally, no pending proceedings under Sections 210 to 227 of the Act against the Petitioners were reported.

5. Dispensation of meetings of shareholders and creditors:
Meetings of shareholders and creditors were dispensed with as all shareholders provided consent via affidavits, and there were no creditors for the Transferor Companies. The Tribunal's directions regarding the dispensation of meetings were duly followed.

6. Representations by the Regional Director and Official Liquidator:
The Regional Director and Official Liquidator submitted representations concerning the Scheme. The Official Liquidator's report indicated that the affairs of the Transferor Company were not conducted prejudicially, as per the relevant provisions of the Companies Act.

7. Sanction of the Scheme by the Tribunal and consequential orders:
After considering submissions and documents, the Tribunal sanctioned the Scheme, making detailed orders regarding the transfer of assets, liabilities, employee engagement, continuation of legal proceedings, share allotment, and compliance with registration requirements.

8. Dissolution of Transferor Companies and compliance with registration requirements:
The Tribunal ordered the Transferor Companies to be dissolved upon compliance with registration formalities within the specified timeline. The Petitioners were directed to provide necessary documentation to the department for verification and compliance purposes.

This comprehensive analysis covers the key aspects of the judgment, highlighting the legal proceedings and outcomes related to the Scheme of Amalgamation under the Companies Act, 2013.

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