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2024 (3) TMI 1241 - AT - Companies LawSanction of composite scheme of amalgamation - Section 230-232 of the Companies Act read with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016 - The appellants contested the impugned order, alleging it was passed without considering the relevant clauses of the scheme of amalgamation - HELD THAT - The impugned order doesn t discuss if the scheme of amalgamation was separable as pointed out in clauses no. 1.2.2 and 23.1. The impugned order is completely silent on these clauses. Even otherwise, section 231(1) (b) of the Companies Act duly empowers the Ld. NCLT to exercise discretion to give such directions in regard to any matter or make such modifications in the compromise or arrangement as it may consider necessary for the proper implementation of the compromise or arrangement . The Ld. NCLT was thus duly vested with sufficient powers under the Companies Act, to even partly sanction the scheme. The impugned order dated 23.02.2023 is set aside - the Ld. NCLT, New Delhi Bench is directed to revisit the application of second motion in the light of the observations made by this Tribunal above and after considering the observations/clarifications of Regional Director, may dispose of the petition in accordance with law within six weeks from the date of communication of this order. Appeal disposed off.
Issues involved:
The judgment deals with the issues related to the approval of a composite scheme of amalgamation under Sections 230-232 of the Companies Act, read with Companies (Compromises, Arrangements and Amalgamation) Rules, 2016. The primary issue revolves around the rejection of parts B and C of the scheme by certain parties and the subsequent dismissal of the second motion seeking approval for part D of the scheme. Details of the Judgment: Issue 1: Consideration of Relevant Clauses of the Scheme The Appellants challenged the impugned order for not considering the relevant clauses of the scheme of amalgamation, specifically Clause 1.2.2 and Clause 23.1. These clauses provided for the severability of different parts of the scheme and the automatic revocation of parts that could not be implemented. The Appellants argued that parts B and C of the scheme were automatically revoked due to non-approval, while part D should be considered separately. Issue 2: Dismissal of Second Motion The Appellants moved a second motion seeking sanction for part D of the scheme excluding parts B and C. However, the Ld. NCLT, New Delhi dismissed the application, citing the rejection of the proposed scheme by the other parties involved. The Appellants contended that the schemes were separable as per the provisions of the composite scheme of amalgamation. Issue 3: Exercise of Discretion by NCLT Section 231(1)(b) of the Companies Act empowers the NCLT to give directions or make modifications in the compromise or arrangement for proper implementation. The Appellants argued that the NCLT had the discretion to partly sanction the scheme, especially considering the separability of the scheme as per the clauses. Issue 4: Legal Precedent and Objections Reference was made to the case of 'Rama Investment Company Pvt. Ltd. vs. Ankit Mittal' where the Supreme Court set aside an order and approved a scheme of amalgamation in part. It was noted that the Official Liquidator and Income Tax department had no objections to the partial acceptance of the scheme. Conclusion: The National Company Law Appellate Tribunal directed the NCLT, New Delhi Bench to revisit the application of the second motion in light of the observations made by the Appellate Tribunal. The NCLT was instructed to consider the observations and clarifications of the Regional Director and dispose of the petition in accordance with the law within six weeks from the date of communication of the order. The appeal and pending applications were disposed of accordingly.
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