2013 (10) TMI 1050 - HC - Companies Law

Compromise and Arrangement u/s 391 to 394 of Companies Act Sanction of Scheme Held that - No objection had been received to the Scheme of Amalgamation from any other party - Director of the Petitioner/Transferor Company, had filed an affidavit confirming that neither the Petitioner Company nor its Legal Counsel had received any objection pursuant to citations published in the newspapers. In view of the approval accorded by the Shareholders and Creditors of the Petitioner/Transferor Company, representation/reports filed by the Regional Director and the Official Liquidator, attached with this Court to the proposed Scheme of Amalgamation, there appears to be no impediment to the grant of sanction to the Scheme of Amalgamation - sanction was granted to the Scheme of Amalgamation under Sections 391 and 394 of the Companies Act, 1956 - The petitioner/Transferor Company will comply with the statutory requirements in accordance with law. Certified copy of the order will be filed with the Registrar of Companies within 30 days from the date of receipt of the same. In terms of the provisions of Sections 391 and 394 of the Act, and in terms of the Scheme, the whole of the undertaking, the property, rights and powers of the Petitioner/Transferor Company be transferred to and vest in the Transferee Company without any further act or deed - all the liabilities and dues of the Petitioner/Transferor Company will be transferred to the Transferee Company without any further act or deed - the order will not be construed as an order granting exemption from payment of stamp duty or taxes or any other charges, if payable in accordance with any law, or permission/compliance with any other department which may be specifically required under any law - The Transferor Company shall stand dissolved without following the process of winding up Petition was allowed.

Issues involved:
Petition under Sections 391 to 394 of the Companies Act, 1956 seeking sanction of Scheme of Amalgamation.

Analysis:
1. The petition was filed by the Transferor Company seeking sanction of the Scheme of Amalgamation with the Transferee Company under Sections 391 to 394 of the Companies Act, 1956.
2. The registered offices of the Transferor and Transferee Companies were located in New Delhi and Chennai, respectively.
3. Details regarding the incorporation date and capital structure of the Transferor Company were provided in the petition.
4. The petition included the Memorandum and Articles of Association, audited Annual Accounts, and unaudited Provisional Accounts of the Transferor Company.
5. A Resolution by the Board of Directors approving the Scheme of Amalgamation was also submitted with the petition.
6. It was confirmed that no proceedings under Sections 235 to 251 of the Companies Act, 1956 were pending against the Transferor Company.
7. The share exchange ratio for amalgamation was outlined in the Scheme.
8. Previous directions were sought and obtained for dispensation of meetings of Shareholders and Creditors of the Transferor Company.
9. Notice of the petition was issued to the Regional Director, Northern Region, and the Official Liquidator.
10. Citations were published in newspapers, and compliance with service and publication was demonstrated.
11. The Official Liquidator's report stated no complaints against the Scheme and no prejudicial conduct by the Transferor Company.
12. The Regional Director's report highlighted employment continuity for Transferor Company employees post-amalgamation.
13. The Regional Director also noted the procedure for changing the Name and Memorandum of Association of the Transferee Company.
14. A rejoinder affidavit clarified the status of proceedings in Chennai and affirmed compliance with necessary procedures post-approval of the Scheme.
15. Reference was made to a previous court order rejecting objections similar to those raised by the Regional Director.
16. Objections raised by the Regional Director were considered no longer valid.
17. No objections were received from any other party regarding the Scheme of Amalgamation.
18. Sanction was granted to the Scheme of Amalgamation, subject to compliance with statutory requirements.
19. The Transferor Company agreed to deposit a sum in the Common Pool Fund of the Official Liquidator.
20. The petition was allowed, with the order for further proceedings to be issued.

This detailed analysis covers the key aspects and proceedings outlined in the judgment regarding the petition for sanction of the Scheme of Amalgamation under the Companies Act, 1956.

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