2016 (7) TMI 116 - HC - Companies Law

Scheme of Amalgamation - Held that - Upon perusal of the report of the Official Liquidator and the Regional Director the reply affidavit filed on behalf of the petitioner transferee company and having considered the Scheme of Amalgamation together with relevant documents on record the Court finds it appropriate to grant sanction to the present Scheme of Amalgamation. In view of the above the Scheme of Amalgamation is sanctioned. It is however directed that the petitioner Transferor Company shall preserve its books of accounts papers and record and shall not dispose of the records without the prior permission of the Central Government under Section 396A of the Companies Act 1956. It is further observed that the petitioner transferor company shall ensure statutory compliance of all applicable laws. It is also observed that the sanction of the present Scheme would not absolve the company from any of its statutory liability if applicable.

Summary

Issues:
1. Sanction of the Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956.
2. Dispensation of meetings of Equity Shareholders and Creditors.
3. Compliance with FEMA, RBI Guidelines, and Income Tax Act.
4. Report of the Official Liquidator and preservation of records.
5. Grant of sanction to the Scheme of Amalgamation.

Analysis:
1. The petition was filed seeking sanction of the Scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956, involving the merger of Logic Plastics Private Limited with Gujarat Nippon Enterprises Private Limited.

2. The Transferee Company sought dispensation of the meeting of Equity Shareholders and Creditors, which was granted by the Court for both companies based on separate applications filed by each company.

3. The Regional Director raised concerns regarding compliance with FEMA, RBI Guidelines, and the Income Tax Act. The Transferee Company responded, stating no specific compliances were necessary under FEMA for the Scheme, but they would abide by any requirements if applicable. They also assured compliance with the Income Tax Act and Rules.

4. The Official Liquidator confirmed that the affairs of the Transferor Company were not prejudicial and requested preservation of records and compliance with statutory liabilities, which the Court directed the Transferor Company to adhere to.

5. After considering all submissions, including reports from the Regional Director and the Official Liquidator, the Court granted sanction to the Scheme of Amalgamation. It directed the Transferor Company to preserve records, ensure statutory compliance, and clarified that the sanction did not absolve the company from any statutory liabilities.

6. The Court determined the costs of the petition and directed the petitioners to lodge necessary documents with the concerned authorities for stamp duty adjudication. The petitioners were also instructed to file copies of the order and Scheme with the Registrar of Companies electronically.

7. The filing and issuance of the drawn-up order were dispensed with, and the Registrar was directed to issue an authenticated copy of the order promptly. The petitions were disposed of accordingly, concluding the legal proceedings related to the Scheme of Amalgamation.