2017 (1) TMI 192 - HC - Companies Law

Court Sanctions Amalgamation Scheme under Companies Act 1956

Idea Mobile Commerce Services Limited Versus Aditya Birla Idea Payments Bank Limited

The Court sanctioned the proposed scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956, between the Transferor Company and the ... Scheme of amalgamation - Held that:- Considering the approval accorded by the shareholders and creditors of the Transferor Company to the proposed scheme; the affidavit filed by the Regional Director, Northern Region and the report filed by the Official Liquidator, having not raising any objection to the proposed scheme, there appears to be no impediment to the grant of sanction to the proposed scheme. Consequently, sanction is hereby granted to the proposed scheme. The Transferor Company will comply with the statutory requirements in accordance with law. Upon the sanction becoming effective from the appointed date of Amalgamation, i.e. 1st August, 2016, the Transferor Company shall stand dissolved without undergoing the process of winding up. A certified copy of the order, sanctioning the scheme, be filed with the ROC, within thirty (30) days of its receipt. Notwithstanding the above, if there is any deficiency found or, violation committed qua any enactment, statutory rule or regulation, the sanction granted by this court to the scheme will not come in the way of action being taken, albeit, in accordance with law, against the concerned persons, directors and officials of the Transferor Company and the Transferee Company. It is made clear, that this order shall not be construed as an order granting exemption, inter alia, from, payment of stamp duty or, taxes or, any other charges, if, payable, as per the relevant provisions of law or, from any applicable permissions that may have to be obtained or, even compliances that may have to be made, as per the mandate of law. Issues:1. Sanction to the proposed scheme of Amalgamation under Sections 391 to 394 of the Companies Act, 1956.2. Compliance with RBI regulations for the transfer of Pre-Paid Payment Instruments (PPI) business.3. Approval of shareholders and creditors for the proposed scheme.4. Grant of costs by the Official Liquidator.Issue 1: Sanction to the Proposed Scheme of AmalgamationThe petition filed by the Transferor Company sought sanction for the proposed scheme of Amalgamation with the Transferee Company under Sections 391 to 394 of the Companies Act, 1956. The Transferor Company and the Transferee Company had approved the scheme in separate meetings, and relevant documents like Resolutions, Memorandum of Association, and Articles of Association were submitted. The background and rationale for the scheme were detailed, emphasizing compliance with RBI regulations.Issue 2: Compliance with RBI RegulationsThe Official Liquidator and the Regional Director, Ministry of Corporate Affairs, did not raise objections to the scheme, subject to compliance with RBI regulations by the Transferee Company. The Transferor Company undertook to comply with the RBI regulations regarding Payments Bank licensing guidelines and the transfer of PPI business. The Official Liquidator highlighted the need for adherence to regulatory conditions and permissions from relevant authorities.Issue 3: Approval of Shareholders and CreditorsThe shareholders and creditors of the Transferor Company had previously approved the scheme, and no objections were received from any party during the process. The Regional Director and the Official Liquidator expressed satisfaction with the compliance and no objections to the scheme, leading to the grant of sanction by the Court. The Transferor Company was directed to fulfill statutory requirements post-sanction.Issue 4: Grant of CostsThe Official Liquidator requested costs of at least &8377; 2,00,000 due to the extensive examination of records, which was accepted by the Transferor Company. The Court ordered the Transferor Company to deposit the costs with the Delhi High Court Bar Association Lawyers Social Security and Welfare Fund within two weeks. The petition was allowed, and the matter was disposed of accordingly, ensuring compliance with legal provisions and regulations.This detailed analysis covers the key issues addressed in the judgment, focusing on the legal aspects, compliance requirements, approvals obtained, and the financial implications involved in the scheme of Amalgamation.