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TMI Blog2024 (10) TMI 985X X X X Extracts X X X X X X X X Extracts X X X X ..... se it is not, then also only justification would have to be obtained from the applicants that it is not against public interest. Admittedly the petition was filed in December 2019 but owing to the outbreak of Covid pandemic there has been a delay beyond anybody s control in the sanction of the scheme, but despite that the Appointed Date should have been kept as 01.04.2019. A bare perusal of judgements in Accelyst Solutions Pvt Ltd Vs Freecharge Payment Technologies Pvt Ltd [ 2021 (3) TMI 1009 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH NEW DELHI ] and Shree Balaji Cinevision (India) Pvt Ltd [ 2009 (9) TMI 920 - GUJARAT HIGH COURT ] would show while sanctioning the scheme of arrangement if the Court comes to a conclusion that the provisions of statute have been complied with; and that there is no violation of any provision of law, or the proposed scheme of compromise or arrangement is not unquestionable, unconscionable or contrary to public policy, then the NCLT has no further jurisdiction to sit in appeal over the commercial wisdom of the class of person who with their eyes open have given their approval, even if, the Court is of the view that better scheme could have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Scheme Application number CA(CAA)/4044/MB/2019 (admitted on February 06, 2020) and Company Scheme Petition CP(CAA)/85/MB/2021 (admitted on August 24, 2021). 6 . The matter was listed on several occasions on the board for hearing but could not be heard due to several reasons including paucity of time. The Appellant Companies, in view of the same also filed interlocutory applications praying for urgent hearing of the matter. 7. The Hon'ble NCLT, thereafter, in consideration of the approval of shareholders of the Appellants and basis the report of the applicable regulatory authorities, approved the Scheme of Amalgamation of Marathon Nextgen Townships Private Limited with Marathon Nextgen Realty Limited ( Scheme ) vide its order dated July 14, 2023. The Hon'ble NCLT, however, while approving the Scheme directed the Appellants to revise the Appointed Date from April 01, 2019, to April 01, 2020, without providing any cogent reasons. It held the appointed date is proposed as 01.04.2019 which is ante dated more than 2 years. Hence the appointed date be amended to 01.04.2020. 8. Heard 9 . Section 232(6) of the Companies Act, 2013 read as under:- (6) The scheme under this section sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iling of the Scheme. Hence, even as per sub-para (c) of para 6 there was no need to change the Appointed Date. Even otherwise, as per the said sub-para, if the Appointed Date was ante dated beyond a year from the date of filing, which in the present case it is not, then also only justification would have to be obtained from the applicants that it is not against public interest. Para IV (b) of para 7 of the impugned order would show the reasoning of setting out the Appointed Date by the appellant as 01.04.2019 was as under:- In respect of the observation of the Regional Director, Western Region, Mumbai in paragraph IV(b) of their Representation, I would like to say that, the Scheme sets out a specific date i.e. 1st April, 2019 and was filed within one year from the set Appointed date i.e. on December 1, 2019. It is clarified that for accounting purposes the appointed date shall also deemed to be the acquisition date and the date of transfer of control for the purposes of confirming to the accounting standards (including Ind-AS 103 Business Combinations). 12 . Admittedly the petition was filed in December 2019 but owing to the outbreak of Covid pandemic there has been a delay beyond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the Court are found to have been met, the Court will have no further jurisdiction to sit in appeal over the commercial wisdom of the majority of the class of persons who with their open eyes have given their approval to the scheme even if in the view of the Court there would be a better scheme for the company and its members or creditors for whom the scheme is framed. The Court cannot refuse to sanction such a scheme on that ground as it would otherwise amount to the Court exercising appellate jurisdiction over the scheme rather than its supervisory jurisdiction. It is the commercial wisdom of the parties to the scheme who have taken an informed decision about the usefulness and propriety of the scheme by supporting it by the requisite majority vote that has to be kept in view by the Court. The Court has neither the expertise nor the jurisdiction to delve deep into the commercial wisdom exercised by the creditors and members of the company who have ratified the scheme by the requisite majority. Consequently the Company Court's jurisdiction to that extent is peripheral and supervisory and not appellate. The Court acts like an umpire in a game of cricket who has to see tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alculations awry, none of the shareholder opposed the Appointed date proposed in the scheme of amalgamation. In identical facts Hon ble High Court of Gujrat in the Case of O.J. Appeal No. 65 of 2009 in CP No. 100 of 2009 in Re. Shree Balaji Cinevision India Pvt. Ltd. decided on 23.09.2009 held that: We have perused the Judgment of the Ld. Company Judge. We do agree with the Ld. Company Judge that the Company Court has discretion to make modification in the proposed scheme of compromise, arrangement etc. However, such discretion is required to be exercised for cogent reasons. We do agree with Mr Soparkar that the Ld. Company Judge had no reason to modify the Appointed date proposed inthe scheme of amalgamation. We also agree that the alteration in the appointed date would affect the calculations and would have financial implications. For the aforesaid reasons, we allow these appeals. The modification made by the Ld. Company Judge in respect of the Appointed date proposed in the scheme of amalgamation is set aside. The scheme of the amalgamation as proposed is sanctioned. 16. With the aforesaid, we are of the considered view that the exercising jurisdiction by the NCLT Mumbai to modi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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