Amalgamation scheme sanctioned after objections on share ratio, reserves, and tax compliance were satisfactorily addressed.

A Gujarat HC decision on sanction of an amalgamation scheme under sections 391 to 394 of the Companies Act, 1956 notes that meetings were dispensed with on consent affidavits and that notice was duly served on the Regional Director and Official Liquidator. The Regional Director's objections on share exchange ratio, treatment of reserves, and income-tax compliance were addressed to the court's satisfaction, and the Official Liquidator reported no prejudice to members or the public interest. On that basis, the scheme was treated as genuine and beneficial to shareholders and creditors, and sanction was granted.

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Issues: Whether the scheme of amalgamation should be sanctioned under sections 391 to 394 of the Companies Act, 1956.

Analysis: The requirements for convening meetings stood dispensed with on the basis of consent affidavits. Notice was duly published and served on the Regional Director and the Official Liquidator. The objections raised by the Regional Director regarding the share exchange ratio, treatment of reserves, and compliance with income-tax provisions were addressed by the petitioners and found satisfactory. The Official Liquidator reported that the transferor company's affairs had not been conducted in a manner prejudicial to the interests of members or the public interest. The scheme was found to be genuine and beneficial to the shareholders and creditors.

Conclusion: The scheme of amalgamation was sanctioned and the company petitions were allowed in favour of the petitioners.

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