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2016 (4) TMI 358 - HC - Companies LawScheme of Amalgamation - Held that - The amalgamation under the proposed Scheme appears to be in the interest of the companies and their members and creditors, this Court is of the view that the Scheme deserves to be sanctioned. The Arrangement otherwise seems to be appropriate and hence, it is required to be sanctioned with a specific observation that the sanctioning of the Scheme would not absolve anyone who is otherwise liable for any responsibility or liability, only on account of this sanctioning. In view of the above, the Scheme of Amalgamation is sanctioned. It is, however, directed that the petitioner shall preserve its books of accounts, papers and records and shall not dispose of the records without the prior permission of the Central Government under Section 396A of the Companies Act,1956.
Issues:
Petition for the sanctioning of the Scheme of Amalgamation involving GEA Pharma System (India) Private Limited and GEA Process Engineering (India) Private Limited. Detailed Analysis: 1. Sanctioning of the Scheme of Amalgamation: The High Court heard the petitions filed by the respective companies for the sanctioning of the Scheme of Amalgamation of GEA Pharma System (India) Private Limited with GEA Process Engineering (India) Private Limited. The Court had earlier dispensed with the requirement of holding meetings of shareholders and creditors of the Transferor Company. A meeting of the Unsecured Creditors of the Transferor Company was held, where all creditors voted in favor of the Scheme. The Court also dispensed with the meeting of shareholders and creditors of the Transferee Company. The petitions were admitted, and notices were issued to the Central Government and the Official Liquidator. The Court, after considering submissions, sanctioned the Scheme of Amalgamation, ensuring that the sanctioning does not absolve anyone liable for any responsibility or liability. 2. Compliance and Observations: The Regional Director of the Ministry of Corporate Affairs made certain observations regarding compliance with FEMA and RBI guidelines, Accounting Standard 14, and convening a meeting of the preference shareholder of the Transferee Company. The petitioners responded, confirming compliance with FEMA guidelines, Accounting Standard 14, and providing details of the preference shareholder meeting. The Official Liquidator raised concerns about Deferred Tax Assets, lease rent claims, and fund diversion, which were addressed by the petitioners with explanations and clarifications. 3. Final Orders and Directions: The Court sanctioned the Scheme of Amalgamation, directing the petitioners to preserve their records and not dispose of them without prior permission. The Scheme was declared binding on the companies, their shareholders, and creditors. The Transferor Company was ordered to be dissolved without winding up upon delivery of a certified copy of the order to the Registrar of Companies. Costs were quantified for the Assistant Solicitor General and the Official Liquidator, to be paid by the respective companies. The petitioners were directed to lodge the order, schedule of assets, and the Scheme for stamp duty adjudication, and file copies with the Registrar of Companies. 4. Miscellaneous Directions: The Court dispensed with the filing and issuance of a drawn-up order, allowing authorities to act on a copy of the order. The Registrar was instructed to issue an authenticated copy of the order and Scheme promptly. The petitions were disposed of with the above directions and sanctions. This detailed analysis covers the key aspects of the judgment, including the sanctioning of the Scheme of Amalgamation, compliance with regulations, responses to observations, final orders, and miscellaneous directions issued by the High Court.
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