Court Approves Amalgamation Scheme for Companies in New Delhi

The court granted sanction to the Scheme of Amalgamation under sections 391 and 394 of the Companies Act, 1956, for two companies based in New Delhi. Approval was given considering shareholder and creditor support, Regional Director's endorsement, and absence of objections. The order directed compliance with statutory requirements, transfer of assets, and deposit of funds in the Official Liquidator's account, without exemption from stamp duty.

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Issues:
Petition filed under sections 391 & 394 of the Companies Act, 1956 for sanction to the Scheme of Amalgamation of two companies. Compliance with statutory requirements, approval by shareholders and creditors, objections raised by Regional Director and Official Liquidator, valuation report concerns, objections from other parties, and final grant of sanction.

Analysis:
The petition was filed seeking sanction to the Scheme of Amalgamation under sections 391 & 394 of the Companies Act, 1956, involving two companies. The registered offices of the companies were in New Delhi. Details regarding the incorporation dates, capital structure, and resolutions approving the scheme were provided in the petition along with necessary documents like Memorandum, Articles of Association, and audited accounts. No pending proceedings under relevant sections of the Companies Act were reported. Earlier, directions were sought for dispensation of meetings, and after compliance, the present petition was filed for sanction. Notice was issued to the Regional Director and Official Liquidator, and publications were made in newspapers as per court orders, with evidentiary filings.

The Regional Director, in response, submitted an affidavit supporting the scheme, mentioning employee transfers and no objection from the Central Government. However, there was a delay in filing the Balance Sheet, later rectified. The Official Liquidator raised concerns about the valuation report not being based on the Book Value of shares. The petitioner's counsel cited precedents where courts upheld expert valuation without errors, dismissing objections similar to the one raised. Directors of the petitioner companies confirmed no objections received from any party post-publication of citations.

Considering the approval by shareholders and creditors, representation by the Regional Director, and lack of objections, the court granted sanction to the Scheme of Amalgamation under sections 391 and 394 of the Companies Act, 1956. The companies were directed to comply with statutory requirements within the specified timeline. The order mandated the transfer of all property, rights, powers, liabilities, and duties from the Transferor Company to the Transferee Company without additional formalities. The order did not exempt from stamp duty or other charges as per the law. The petitioner companies agreed to deposit a sum in the Official Liquidator's fund. The petition was allowed, and the order was issued for immediate action.

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