2022 (4) TMI 82 - Tri - Companies Law

Sanction of Scheme of Amalgamation - Section 230-232 and Section 66 of Companies Act, 2013 and other applicable provisions of the Act read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 - HELD THAT - The Scheme contemplated between the petitioner companies, appears to be prima facie in compliance with all the requirements stipulated under the relevant Sections of Companies Act, 2013. In the absence of any objections and since all the requisite statutory compliance have been fulfilled, this Tribunal sanctions the Scheme of Amalgamation appended as Annexure A-1 with the company petition. The scheme is approved - application allowed.

Issues Involved:
1. Sanctioning of the Scheme of Amalgamation under Sections 230-232 and Section 66 of the Companies Act, 2013.
2. Dispensation with meetings of shareholders and creditors.
3. Compliance with statutory requirements and responses from regulatory authorities.
4. Transfer of liabilities and assets.
5. Rights of the Income Tax Department.
6. Compliance with accounting standards.
7. Procedural directions post-sanctioning of the scheme.

Detailed Analysis:

1. Sanctioning of the Scheme of Amalgamation:
The petitioner companies sought the Tribunal's approval for the Scheme of Amalgamation under Sections 230-232 and Section 66 of the Companies Act, 2013. The Tribunal reviewed the scheme and found it prima facie in compliance with the relevant sections of the Act. The scheme was sanctioned as it met all statutory requirements and no objections were raised.

2. Dispensation with Meetings of Shareholders and Creditors:
The petitioner companies filed a first motion application to dispense with the meetings of equity shareholders, secured and unsecured creditors, preferential shareholders, and non-convertible debenture holders. The Tribunal granted this request in an order dated 04.11.2020, citing reasons recorded in the order.

3. Compliance with Statutory Requirements and Responses from Regulatory Authorities:
The petitioner companies complied with the Tribunal's directions issued on 12.01.2021 by filing a compliance affidavit and making newspaper publications. Notices were served to various statutory authorities, including the Central Government, Registrar of Companies, Official Liquidator, Income Tax Department, SEBI, BSE, and NSE. The Registrar of Companies and Regional Director reported compliance with filing requirements and no pending prosecutions or investigations. The Official Liquidator had no adverse observations. There were no objections from SEBI, BSE, and NSE.

4. Transfer of Liabilities and Assets:
The Tribunal ordered that all property, rights, and powers of the transferor companies be transferred to the transferee company without further act or deed. Similarly, all liabilities and duties of the transferor companies were to be transferred to the transferee company. The appointed date for the scheme was set as 01.04.2020.

5. Rights of the Income Tax Department:
The Income Tax Department reported pending demands for certain assessment years but had no objection to the scheme if liabilities were transferred to the transferee company. The Tribunal clarified that the tax authorities' rights to recover lawful dues would remain intact and that the scheme provided adequate provisions to meet the issues raised by the Income Tax Department.

6. Compliance with Accounting Standards:
The statutory auditors certified that the accounting treatment proposed in the scheme was in compliance with applicable Indian Accounting Standards (Ind AS) and Generally Accepted Accounting Principles.

7. Procedural Directions Post-Sanctioning of the Scheme:
The Tribunal issued several procedural directions, including:
- Transfer of property, rights, powers, liabilities, and duties to the transferee company.
- Continuation of pending proceedings by or against the transferee company.
- Transfer of employees to the transferee company.
- Set-off of fees paid by transferor companies against fees payable by the transferee company.
- Filing of revised memorandum and articles of association with the Registrar of Companies.
- Delivery of a certified copy of the order to the Registrar of Companies within 30 days, leading to the dissolution of the transferor companies without winding up.
- Payment of specified amounts to the Company Law Tribunal Bar Association and the Regional Director, Northern Region.
- Filing of an affidavit regarding compliance with specific sections of the Companies Act within 30 days.

The Tribunal also clarified that the order did not exempt payment of stamp duty, taxes, or other charges due under the law. The Company Petition CP (CAA) No.25/Chd/Pb/2020 was disposed of accordingly.

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