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TMI Blog2020 (11) TMI 516X X X X Extracts X X X X X X X X Extracts X X X X ..... trative, and other expenditure and achieving operational rationalization, organizational efficiency and optimal utilization of resources in the interest of shareholders, etc. On a consideration of the facts of the case as mentioned in the preceding paragraphs, which are not elaborating here again to avoid duplication and repetition, we are satisfied that the procedure specified in sub- sections (1) and (2) of section 232 of the Companies Act, 2013 has been complied with, and hence the scheme of amalgamation, as approved by the boards of both the transferor company and the transferee company, is hereby sanctioned, as prayed. Application allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions of sections 230 to 232 of the Companies Act, 2013, rules and regulations made thereunder, (hereinafter referred to as "the Act"), as amended from time to time, or other applicable provisions, if any, of the Act, read with the relevant provisions of the memorandum of association and articles of association of the company and subject to the requisite approval of the shareholders, banks, other creditors, and other statutory/regulatory authorities as may be applicable or required and the approval by the National Company Law Tribunal, Bengaluru Bench, consent of the board of directors of the company is hereby accorded for the amalgamation of this company, i. e., Health and Glow Retailing P. Ltd. (the 'transferor company') with and into Health and Glow P. Ltd. (the 'transferee company')." (3) M/s. Health and Glow P. Ltd. (hereinafter referred to as "transferee company') was incorporated as a private limited company on August 25, 1999, with the Registrar of Companies, Tamil Nadu under the Companies Act, 1956 bearing the name of "Foodworld Supermarkets Ltd." and thereafter it was converted into a private company with effect f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed scheme is in conformity with applicable Accounting Standards prevalent in India. Further, the said LLP, being the statutory auditors of the transferor company vide another certificate dated June 27, 2019 has, inter alia, opined that the accounting treatment contained in clause 7 of the proposed scheme is in conformity with the applicable Accounting Standards prevalent in India. (6) The restructuring, consolidation and streamlining pursuant to this scheme shall achieve, inter alia, the following benefits : (a) Enabling consolidation of all companies indirectly and jointly held by the HMK group and RR group ; (b) Enabling simplification of the holding structure of the companies including to inter alia achieve ease of management and holding structures/layers and to be a compliant structure in case of potentially setting up future step-down subsidiaries (if any), post the completion of the scheme ; (c) Enabling common accounting, common compliances and com mon auditing resulting in reduction of costs, post the completion of the scheme ; (d) Attracting and facilitating investors, strategic partners and other stakeholders who may be interested in investing in the transferee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... responding provisions of the Companies Act, 1956 or under any other law, against either of the companies. Further, the sanctioning of the scheme in question will be for the benefit of both the transferor company and the transferee company. 3. The petitioners herein had filed C. A. (CAA) No. 50/BB/2019 before this Tribunal praying for dispensation of meetings of the equity shareholders, preference shareholders of the transferor and transferee companies, and the meetings of secured creditors and unsecured creditors of the transferee company, for considering the scheme, etc. The Tribunal vide its order dated September 17, 2019, has dispensed with the meetings of the equity share- holders and preference shareholders of both the companies and directed to convene the meetings of the secured and unsecured creditors of the transferee company. 4. The Tribunal vide its order dated November 25, 2019, directed the petitioners to issue notice to the Regional Director (SER), Hyderabad, Registrar of Companies, Karnataka, Official Liquidator, Deputy Commissioner of Income-tax Circle 3(1)(2), Commissioner of Income-tax and to the Secretary, Competition Commission of India and further directed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above period and get the offence adjudicated. Undertaking to this office may be called for from the applicant-company. (2) The transferee company has related party transactions. Necessary compliance under section 188 of the Companies Act, 2013 and along with the details about compliance or otherwise of the same may be submitted to the Registrar of Companies. (3) As per clause 7 of the scheme, it is stated that the accounting treatment would be in compliance with applicable Accounting Standards the company will be following "pooling of interests method". 7. The official liquidator vide O. L. R. No. 17 of 2020, dated February 18, 2020 in C. P. (CAA) No. 57/BB/2019 has, inter alia, stating that for scrutiny of the books of account and records of the transferor company, he has engaged M/s. Shreenivas S. Dotihal and Co. the firm of chartered accountants, which after examining the affairs of the transferor company, has, inter alia, reported in their report dated January 29, 2020 in paragraph 8 under tax liabilities, the following tax litigations are pending before various forums : Assessment year Status of assessment/Appeal Demand by IT Department Paid by the company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and therefore no impediment before this Tribunal to sanction the scheme. 10. Heard Mr. C. K. Nandakumar, learned counsel for the petitioner companies and Smt. Prema Hatti, learned standing counsel for the Registrar of Companies through video conference. We have carefully perused the pleadings of the parties and the extant provisions of the Companies Act, 2013 and various Rules made thereunder and the law on the issue. 11. As stated supra by the Regional Director/Registrar of Companies, it is seen that the transferee company has not appointed whole-time company secretary for the period February 2, 2013 to February 23, 2014, i. e., 386 days and thus it violated the provisions of section 383A of the Companies Act, 1956. Accordingly, the transferee company shall file separate application for adjudication of the same post the approval of the scheme in question. 12. In conclusion, it has been stated by the Regional Director that, on a consideration of the materials on record, the scheme of amalgamation appears to be fair, reasonable and is not detrimental against the members or creditors or contrary to public policy and the same can be approved. 13. We have considered the facts of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cluding taxes, levies and charges, if any, and duties of the transferor company be transferred without further act or deed to the transferee company and accordingly the same shall, pursuant to section 232 of the Companies Act, 2013, be transferred to and become the liabilities and duties of the transferee company ; (5) The tax implications, if any, arising out of the scheme are subject to final decision of concerned Income-tax authorities and the decision of the concerned tax authorities shall be binding on the transferee company ; (6) All the proceedings now pending by or against the transferor company be continued by or against the transferee company, if any ; (7) Any liability, if any, arising from non-compliance with the pro visions contained in section 135, shall stand transferred to and be the liability of the transferee company ; (8) The petitioner-companies shall within thirty days of the date of the receipt of this order cause a certified copy of this order along with a copy of scheme of amalgamation to be delivered to the Registrar of Companies for registration in accordance with applicable rules and regulations ; (9) The acceptance of the scheme of amalgamation ..... 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