Court approves scheme of amalgamation under Companies Act, 1956, addressing objections and stamp duty issue. The court approved the scheme of amalgamation of two companies under the Companies Act, 1956, finding it genuine and in the interest of shareholders and ...
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Court approves scheme of amalgamation under Companies Act, 1956, addressing objections and stamp duty issue.
The court approved the scheme of amalgamation of two companies under the Companies Act, 1956, finding it genuine and in the interest of shareholders and creditors. The court addressed objections raised, including a stamp duty issue, which was rectified. The Official Liquidator confirmed that the non-payment of stamp duty did not harm stakeholders. The court sanctioned the scheme, directing the petitioner to pay specified fees to the Assistant Solicitor General of India. Legal proceedings related to the amalgamation were concluded with the disposal of the petition.
Issues: Sanctioning the arrangement embodied in the scheme of amalgamation of two companies under the Companies Act, 1956.
Analysis: The judgment pertains to a company petition seeking approval for the amalgamation of two companies under the scheme of amalgamation. The petitioner-company, acting as the transferor-company, filed the petition for the transfer of its undertaking to the transferee-company. The court had earlier dispensed with the requirement of meetings of equity shareholders and unsecured creditors for approving the scheme. Notices were issued to the Central Government and the Official Liquidator, and affidavits confirming the publication of notices were filed. The Central Government requested the submission of the latest financial statements, which were duly provided. The objections raised were addressed, and the court found no grounds to refuse approval to the scheme.
The Official Liquidator's report highlighted a stamp duty issue concerning the issuance of shares by the company. The chartered accountant's report noted non-payment of stamp duty, which was later rectified by the company. The Official Liquidator opined that the non-payment did not prejudice the interests of members or the public. The court concurred with the Official Liquidator's assessment and approved the scheme of amalgamation, finding it genuine, bona fide, and in the interest of shareholders and creditors. Consequently, the court sanctioned the scheme and granted the requested reliefs in the company petition.
The court quantified the fees of the Assistant Solicitor General of India and directed the petitioner-company to pay the specified amount directly. The petition was disposed of accordingly, concluding the legal proceedings related to the scheme of amalgamation.
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