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TMI Blog2018 (12) TMI 1544X X X X Extracts X X X X X X X X Extracts X X X X ..... a scheme of merger by absorption of M/s. Sajjan Specialty Ltd. (first transferor company) and M/s. Agrasen Impex P. Ltd. (second transferor company) and M/s. Agrasen Dyes and Intermediates P. Ltd. (third transferor company) with M/s. Sajjan India Ltd. (transferee company) and their respective shareholders. 2. The petitioner-companies have approved the said scheme of merger by absorption by passing the board resolutions and thereafter they have approached the Tribunal for sanction of the scheme. 3. The transferor companies were incorporated as three separate wholly owned subsidiaries of transferee company for the expansion plans of the transferee company. 4. The transferee company is presently engaged in the business of manufacturing, production, trading of various chemicals, related products and allied activities for the various industries, consumers and end users. 5. The merger of the transferor companies with the transferee company would, inter alia, have the following benefits : (i) achieving operational and management efficiency by way of consolidation of business ; consolidation and simplification of the group structure ; (ii) lesser regulatory and legal com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal may not deter the Income-tax authority to scrutinize the tax return filed by the petitioner-companies after giving effect to the scheme. The decision of the Income-tax authority is binding on the petitioner-company. (2) The petitioner in clause 11 of the scheme has, inter alia, mentioned that the authorised share capital of all the transferor companies will be merged with the transferee company. In this regard petitioner-companies have to undertake to comply with the provisions of section 232(3)(i) of the Companies Act, 2013. (3) The petitioner-companies in the scheme has not mentioned about the treatment of tax under section 2(1B) of the Income-tax Act, 1961. In this regard the petitioner-companies have to undertake to comply with the same. (4) The petitioner-companies not submitted copy of the petition, minutes of order of the hon'ble National Company Law Tribunal Chairman's report of the meeting and further notice under section 230 sent by all companies have not served to the directorate. In this regard the petitioner to undertake, submit the same for the record of the Regional Director. (5) Certificate stating that the accounting treatment, if any, p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertakes to comply with all legal and procedural compliances of the office of the Regional Director. (g) Apropos observation of the Regional Director, as stated in para graph IV(5) of the report is concerned, learned counsel for the petitioners undertake that the accounting treatment proposed in the said scheme of merger of the transferor companies with the transferee company and their respective shareholders and creditors shall be in conformity with the accounting standards prescribed by the Central Government under section 133 of the Companies Act, 2013 and related Rules and certificate issued by the statutory auditors of all the four joint petitioners was also attached as an exhibit Y in the said Joint Company Scheme Petition No. 1099 of 2017. Further in addition to compliances with the applicable Accounting Standards, the transferee company undertake to pass such accounting entries as may be necessary in connection with the scheme of amalgamation to com ply with other applicable Accounting Standards. (h) Apropos observation of the Regional Director, as stated in para graph IV(6) of the report is concerned, learned counsel for the petitioners undertake that it will comply w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany has another residential leasehold land admeasuring 10,158.62 sq.meter situated at Atali Housing, Dehej Industrial Estate (Gujarat) which was allotted to it on April 6, 2010 on a lease of 99 years for a total purchase value of ₹ 158.98 lakhs. The book value of this land as on March 31, 2017 is ₹ 148.68 lakhs. We have not been provided any valuation report for the said land and hence the valuation of the said land cannot be commented upon by us. Observation for transfer company No. 2 : We have observed that the transaction for sale of land has been done at a value of ₹ 1,050 per sq. meter against the allotment price of ₹ 1,440 decided by GIDC Estates which is effective from April 1, 2016. We have not been provided any valuation report or any other basis for arriving at this value and hence the correctness of the same cannot be commented upon by us. Observation for transfer company No. 3 : We have observed that the transaction for sale of land has been done at a value of ₹ 1,173 per sq. meter against the allotment price of ₹ 1,070 decided by GIDC Estates which is effective from April 1, 2016. We have not been provided any valuatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fair and reasonable and is not violative of any provisions of law and is not contrary to public policy. And hereby this Bench, to the petitioner-company, do order that : (a) All the liabilities including taxes and charges, if any, and duties of the demerged companies, shall, pursuant to section 232 of the Companies Act, 2013, be transferred to and become the liabilities and duties of the resulting company. (b) The clarifications and undertakings given by learned counsel for the petitioner to the observations made in the report of the Regional Director are considered by this Bench and those are hereby accepted. Subsequently, this Bench hereby directs petitioners to comply with the provisions/ statements which the petitioners undertakes herein. (c) The clarifications given by learned counsel for the petitioner-companies to the observations made in the report of the official liquidator are considered by this Bench and those are hereby accepted. Subsequently, this Bench hereby directs petitioners to comply with the provisions/statements, which the petitioners undertakes herein. (d) Since the entire issued, subscribed and paid-up share capital of the transferor companies is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sideration. Further, it is also noticed that, the scheme under consideration has proposed April 1, 2017 as appointed date of the scheme. That means after sanction of the scheme by this Bench the transferor companies will be dissolved with effect from April 1, 2017. But interestingly, it has come to knowledge that the said transfer of rights over lease hold lands are executed after the appointed date of the scheme, i.e., April 1, 2017. Since, the transferor companies have received the said consideration after the proposed appointed date from the said transaction ; it may be out of the purview of the Income-tax authorities. As the appointed date which is proposed is April 1, 2017 and transactions have occurred after this date, hence, in my humble opinion, sanctioning of this scheme with the same appointed date, will deter the Income-tax authorities to scrutinize the tax liabilities of the transferor companies. (n) Hence, not to dilute the rights of the Income-tax authorities, this Bench hereby orders that, the appointed date of the scheme shall be April 1, 2018 instead of April 1, 2017. Rest of the scheme remains unaltered. (o) The scheme is sanctioned hereby with the above dir ..... X X X X Extracts X X X X X X X X Extracts X X X X
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