2005 (8) TMI 379 - HC - Companies Law

Approval granted for amalgamation scheme, objections overcome, companies to merge smoothly.

The court allowed the company petition for the approval of a scheme of amalgamation under sections 391/394 of the Companies Act, 1956. The resolutions ... Amalgamation Issues:Approval of scheme of amalgamation under section 391/394 of the Companies Act, 1956.Analysis:The company application was filed jointly by three companies for the approval of a scheme of amalgamation. The meetings of equity shareholders of all three companies were held, and the resolutions approving the scheme were unanimously passed. The report of the Official Liquidator confirmed that the affairs of the transferor-company were not conducted in a manner prejudicial to the interest of the members. The objection raised regarding the increase in authorized share capital without payment of fees was countered by the applicant's counsel, citing compliance with section 97 of the Companies Act, 1956. Reference was made to a previous judgment supporting the argument that no further fees or stamp duty were required. The objection of the Regional Director was deemed untenable, and it was held that no additional fees or stamp duty needed to be paid since the combined authorized capital did not exceed that of the three companies. No objections were raised by any party to the scheme of amalgamation. Consequently, the company petition was allowed, and the scheme of amalgamation was confirmed by the court. The transferor companies were to be dissolved without a winding-up order, and their assets and liabilities were to be transferred to the transferee-company as per the appointed date in the scheme.