2020 (9) TMI 361 - Tri - Companies Law

Sanction of Amalgamation Scheme - Sections 230 to 232 of Companies Act - HELD THAT - From the material on record, the Scheme appears to be fair and reasonable and is not violative of any provisions of law and is not contrary to public policy. Since all the requisite statutory compliances have been fulfilled, Petition filed by the Petitioner Company has been made absolute in terms of prayer made in the petition. Petition allowed subject to conditions imposed.

Summary

Issues:
Sanction of Tribunal sought under Sections 230 to 232 of Companies Act, 2013 for Scheme of Amalgamation. Compliance with statutory requirements and Regional Director's report. Fairness and reasonableness of the Scheme.

Analysis:

Issue 1: Sanction of Tribunal under Companies Act, 2013
The Tribunal was approached for sanctioning the Scheme of Amalgamation between two companies, the Transferor Company and the Transferee Company, along with their respective shareholders. The Scheme aimed at consolidating business operations and realizing commercial synergies between the companies. The Board of Directors of the Petitioner Company had approved the Scheme, and the Appointed Date under the Scheme was fixed as 1st April 2019. The consolidation was expected to bring various benefits, including financial strength, operational efficiencies, cost savings, and market presence.

Issue 2: Compliance with Statutory Requirements
The Petitioner Company had complied with all requirements as per the Tribunal's directions and had filed necessary affidavits of compliance. The Regional Director, Ministry of Corporate Affairs, Mumbai, had filed a report stating that, except for certain observations, the Scheme was not prejudicial to the interests of shareholders and the public. The Petitioner Company provided necessary undertakings and clarifications in response to the Regional Director's observations, which were accepted by the Tribunal.

Issue 3: Fairness and Reasonableness of the Scheme
After reviewing the material on record, the Tribunal found that the Scheme appeared fair, reasonable, not violative of any provisions of law, and not contrary to public policy. As all statutory compliances were fulfilled, the Court made the Company Petition absolute, sanctioning the Scheme with the Appointed Date fixed as 1st April 2019. The Scheme was deemed binding on the Petitioner and the involved companies, including shareholders, creditors, and employees. The Petitioner was directed to file necessary documents with the Registrar of Companies, comply with undertakings, and take all statutory steps required under the Act in pursuance of the Scheme.

In conclusion, the Tribunal granted the Petition, allowing the Scheme of Amalgamation to proceed with specific conditions and directives to ensure compliance and implementation of the Scheme in accordance with the Companies Act, 2013.