Composite amalgamation scheme approved after statutory compliances were accepted and objections were resolved, with appointed date fixed.
A composite scheme of amalgamation and merger under the Companies Act, 2013 may be sanctioned where the statutory procedure is followed, the companies have approved the scheme, objections are absent or satisfactorily answered, and the scheme is found fair, reasonable, lawful and consistent with public policy. The Tribunal recorded compliance responses on accounting treatment, notices, stock exchange filings, foreign exchange requirements and document accuracy, accepted the undertakings, and fixed the appointed date as 1 March 2020. The scheme was accordingly approved, with directions for filing, stamping and implementation.
Issues: (i) Whether the composite scheme of amalgamation and plan of merger could be sanctioned under the Companies Act, 2013; (ii) Whether the statutory compliances, regulatory objections and undertakings were sufficient to justify approval of the scheme and fixation of the appointed date.
Issue (i): Whether the composite scheme of amalgamation and plan of merger could be sanctioned under the Companies Act, 2013.
Analysis: The scheme was placed before the Tribunal under the relevant provisions governing compromise, arrangement, amalgamation and cross-border merger. The record showed approval by the companies, absence of opposition, and reports indicating that the affairs of the petitioner company were properly conducted. The Tribunal also recorded that the scheme appeared fair and reasonable, was not violative of law, and was not contrary to public policy.
Conclusion: The scheme was sanctioned in favour of the petitioner companies.
Issue (ii): Whether the statutory compliances, regulatory objections and undertakings were sufficient to justify approval of the scheme and fixation of the appointed date.
Analysis: The Regional Director's observations were answered by the petitioner companies through affidavits and undertakings concerning accounting treatment, notices to authorities, compliance with regulatory requirements, stock exchange filings, foreign exchange compliance, and the accuracy of the scheme documents. Those clarifications were accepted, and the Tribunal accepted the undertakings to comply with the Companies Act, 2013 and the rules made thereunder. The Tribunal also fixed the appointed date as opening hours of 1 March 2020.
Conclusion: The objections stood resolved in favour of the petitioner companies, and the appointed date was fixed as 1 March 2020.
Final Conclusion: The petition was allowed and the scheme received judicial approval with consequential directions for filing, stamping and implementation.
Ratio Decidendi: A scheme of amalgamation may be sanctioned when the statutory procedure is complied with, objections are satisfactorily answered, the scheme is found fair and reasonable, and it is not shown to be contrary to law or public policy.
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AI Drafter ✕
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