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TMI Blog2016 (7) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... proposed vide clause 15 of the scheme are hereby granted. Similarly prayers made in terms of paragraph 17 (a) of the Company Petition for the Resulting Company are hereby granted.The petitions are disposed of accordingly. - COMPANY PETITION NO. 186 of 2016 In COMPANY APPLICATION NO. 112 of 2016 With COMPANY PETITION NO. 187 of 2016 In COMPANY APPLICATION NO. 111 of 2016 - - - Dated:- 23-6-2016 - MR. R.M.CHHAYA, J. FOR THE PETITONER : MRS SWATI SOPARKAR, ADVOCATE FOR THE RESPONDENT : MR KSHITIJ AMIN, CENTRAL GOVERNMENT STANDING COUNSEL for MR DEVANG VYAS, ASSISTANT SOLICITOR GENERAL COMMON ORAL JUDGMENT 1. These are the petitions filed by two companies viz. City Tiles Limited and Airona Tiles Limited, for the purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Petition for the Demerged Company and Clause 15 of the scheme. The Restructuring of the Capital of the Demerged Company is envisaged in form of Utilisation of the Securities Premium Account for the purpose of adjusting the net asset value of the demerged undertaking. The said proposal is covered under the provisions of Sec. 78 read with Sec. 100 to 103 of the Companies Act, 1956 and Section 52 of the Companies Act, 2013. However, the same being consequential in nature is proposed as an integral part of the proposed scheme. The proposal does not involve any reduction in the Issued and Subscribed Share Capital of the Company and the order of the Court sanctioning the Scheme shall be deemed to be an order under Section 102 of the Compani ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Resulting Company. 6. The substantive petitions for the sanction of the scheme were filed by the Demerged Company and Resulting Company which were admitted on 5th May 2016. The notice for the hearing of the petitions were duly advertised in the newspapers Indian Express , English daily and Sandesh , Gujarati daily both Ahmedabad editions of 18th May 2016 and the publication in the Government gazette was dispensed with as directed in the said orders. Affidavits dt. 20th June 2016 confirm the same. No one has come forward with any objections to the said petitions even after the publication and the same has been further confirmed by the additional affidavit dated 21st June 2016. 7. Notice of the petition have been served upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... davit, it has been observed by the Regional Director that the clause 7.3 of the Scheme dealing with the proposed Accounting Treatment is not in accordance with the Accounting Principles and the excess of assets over liabilities cannot be credited to General Reserve Account and has to be treated as Capital Reserve Account. In this regard, it has been submitted that AS14 is not applicable to the Scheme of Demerger. Even in case of Amalgamation, a company is entitled to prescribe under the Scheme itself, a specific treatment to be given to its reserves. Further, Section 211 (3B) of the Companies Act, 1956 also provides that if the practice adopted for such accounting entry, varies from the said standard, necessary disclosure should be made in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Income Tax Act and rules. In view of the same, no further directions are required to be issued to the petitioner companies in this regard. (v) It has been further submitted that there are no complaints received by the Registrar of Companies as confirmed by para 2(f). The Regional Director has vide para 2(g) has confirmed that it has no other objection except the above. 9. Considering all the facts and circumstances and taking into account all the contentions raised by the affidavits and reply affidavits, undertakings provided vide the additional affidavit dated 21st June 2016, I am satisfied that the observations made by the Regional Director, Ministry of Corporate Affairs, have been suitably addressed and hence do not survive. Thi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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