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TMI Blog2022 (5) TMI 584X X X X Extracts X X X X X X X X Extracts X X X X ..... anies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 for sanction of Scheme of Arrangement between Dhampur Sugar Mills Limited (Demerged Company) and Dhampur Bio Organics Limited (Resulting Company) and their respective shareholders and creditors. The Scheme provides for demerger of the Demerged Undertaking of the Demerged Company and vesting of the same with the Resulting Company from the Appointed Date, viz., April 1, 2021, in the manner and on the terms and conditions stated in the said Scheme of Arrangement ( Scheme ) enclosed as Annexure 1 to the Company Petition. 2. The Petition has now come up for final hearing. The Ld. Counsel for the Petitioner Companies submits as follows:- i. The proposed 'Scheme of Arrangement' has previously been approved by the Board of Directors of the Demerged Company and Resulting Company in their respective Board Meetings held on 7th June 2021. The copies of the said resolutions are annexed with the Company Petition and marked as Annexure 4 and Annexure 5 . ii. The Demerged Company, being listed entity, copy of the Scheme was forwarded to Securities and Exchange Board of India t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on planning in an orderly and strategic manner without any business disruption. (e) The shareholding of public shareholders following the Demerger will remain the same in both Companies and shareholder value, across Companies, will be preserved and remain unchanged. 3. A report in relation to the share entitlement ratio for issuance and allotment of shares of Petitioner No. 2 to the shareholders of Petitioner No. 1 pursuant to and in consideration of the demerger of the Demerged Undertaking (as defined in the Scheme) of Petitioner No. 1 into Petitioner No. 2 was issued on 07.06.2021 by Ms. Anuradha Gupta, being an Independent Valuer registered with Insolvency Bankruptcy Board of India vide Regd. No. IBBI/RV/02/2020/12790. A copy of the report was annexed and marked as Annexure 8 to CA(CAA) No. 25/ALD/2021. 4. The Petitioners have stated that the accounting treatment proposed in the Scheme of Arrangement is in conformity with the Accounting Standards prescribed under Section 133 of the Companies Act, 2013 as certified by the Auditors of the Petitioner Companies. The copy of the same was annexed and marked as Annexure 10 to the Company Application No. 25/ALD/2021. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aket Sharma, Practicing Company Secretary, appointed as the Scrutinizer by the Tribunal to conduct and scrutinise the Remote e-voting and scrutinise voting at the venue of the Meetings in a fair and independent manner was also present at the Meetings. The quorum for the Meetings as per the order dated December 6, 2021 were present in the Meetings, and the said Meetings was called to order by the Chairperson. By consent of the Equity Shareholders, Secured Creditors and Unsecured Creditors present at the said Meetings, the resolution to approve the Scheme was carried out with requisite votes and majority. 11. The Petitioner Companies filed the Second Motion Petition being Company Petition No. CP (CAA) No. 03/ALD/2022 on 7th February, 2022. This Tribunal vide its Order dated 14th February, 2022 has admitted the Company Petition and inter-alia directed the Petitioner Companies to issue proper notice to the Regional Director, RoC Kanpur, Income Tax Authority and other Sectoral and Regulatory Authorities for filing its representation within stipulated period, failing which it shall be assumed that they have no reply to file. Further, the Tribunal directed the Petitioner Companies to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an amount being the aggregate borrowings forming part of the Transferred Liabilities which are being transferred to the Resulting Company pursuant to this scheme and the Resulting Company shall not be required to pass any separate resolution in this regard. Such limits shall be incremental to the existing borrowing limits of the Resulting Company . That above contention found in the scheme does not fall under the ambit of section 230-232 of the Act. To increase the borrowing amount above the threshold limits of a company it is required to pass a special resolution in terms of provisions of section 180(1)(c) of the Act and also it requires to file the said resolution passed with e-form MGT-14 with the ROC in public domain. Therefore, it is prayed before the Tribunal to direct the Petitioner Resulting Company to comply with the provisions of section 180(1)(c) of the Act to give effect of the scheme. (c) Observation (Para 11(ii) Page No. 7 of the Affidavit) reads as under: Para 14.3.3 of the scheme speaks about Accounting Treatment in the Books of the Resulting Company on approval of the scheme which states that: The difference i.e. the excess or shortfall, as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the shares issued by the Resulting Company shall be credited or debited to the Capital Reserve in the Books of the Resulting Company in accordance with the applicable Accounting Standards. 15. The Income-Tax Department has filed its representation that the Income-Tax Department has no objection on the Scheme of Arrangement of the Petitioner Companies. 16. We have gone through the reports of the Ld. Regional Director (Northern Region), Ministry of Corporate Affairs, New Delhi, Ld. Registrar of Companies, Uttar Pradesh, Kanpur and Ld. Income-Tax Department, and after perusing the same as aforesaid, we find that there appears to be no reservation to grant sanction to the Scheme and we are of the view that the sanction of the present Scheme is not against public policy, nor it would be prejudicial to the public interest at large. 17. In addition to above, all the statutory compliance seems to have been complied with by the Petitioner Companies, therefore, the present Company Petition deserves to be allowed in terms of its Prayer clause. 18. In the result, the proposed Scheme of Arrangement, which is annexed to the Company Petition stands approved and sanctioned. The Pet ..... 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