2021 (6) TMI 939 - Tri - Companies Law

Approval of Amalgamation Scheme under Companies Act, 2013

Mahadev Super Coat Private Limited and Ors. Versus Aakarshan Estates Private Limited

The Tribunal approved the Joint Second Motion Petition under Sections 230-232 of the Companies Act, 2013, for the Scheme of Amalgamation. Meetings for ... Sanction of Scheme of Amalgamation - Sections 230-232 of the Companies Act, 2013 - Seeking dispensation and convening with various meetings - HELD THAT:- There are no objections to the Scheme and hence there is no impediment in the sanction of the Scheme. Therefore, the Scheme (Annexure A.1) is hereby approved. While approving the Scheme, it is clarified that this order should not be construed as an order in any way granting exemption from payment of any stamp duty, taxes, or any other charges, if any, and payment in accordance with law or granting permission in respect of any compliance with any other requirement which may be specifically required under any law. With the sanction of the Scheme, the Transferor Companies No. 1 to 9, shall stand transferred to and vested in the Transferee Company. The scheme is approved - application allowed. Issues Involved:1. Maintainability of the Joint Second Motion Petition under Sections 230-232 of the Companies Act, 2013.2. Dispensation and convening of meetings for equity shareholders and creditors.3. Compliance with statutory requirements and accounting standards.4. Publication and service of notices.5. Reports and observations from statutory authorities.6. Treatment of employees and legal proceedings.7. Share exchange ratio and valuation.8. Final approval and conditions for the Scheme of Amalgamation.Detailed Analysis:1. Maintainability of the Joint Second Motion Petition:The petition was filed under Sections 230-232 of the Companies Act, 2013, by the Petitioner Companies for the sanction of the Scheme of Amalgamation. The petition is maintainable in terms of Rule 3(2) of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016.2. Dispensation and Convening of Meetings:The First Motion Application sought dispensation with the requirement of convening meetings of equity shareholders and creditors. The Tribunal issued necessary directions on 11.12.2019, dispensing with the meetings for certain companies as consent affidavits were obtained and convening meetings for others. The Scheme was approved unanimously in the separate meetings of the Secured Creditors and Unsecured Creditors without any modification.3. Compliance with Statutory Requirements and Accounting Standards:The certificates from statutory auditors confirmed that the accounting treatment in the Scheme complies with the Accounting Standards under Section 133 of the Companies Act, 2013. The audited financial statements and provisional statements were annexed to the petition. The Petitioner Companies are unlisted and not regulated by any sectoral regulators.4. Publication and Service of Notices:The Tribunal directed the publication of notices in 'Financial Express' and 'Jansatta' and service upon specified authorities and objectors. Compliance affidavits were filed, confirming the publication and service of notices. No objections were received against the Scheme.5. Reports and Observations from Statutory Authorities:- Regional Director (RD): Filed a report reiterating the petition's contents and confirming the filing of annual returns and balance sheets up to 2018-19. No prosecution, inspection, investigation, or inquiry was conducted against the petitioner companies.- Registrar of Companies (RoC): No adverse observations were reported regarding the proposed Scheme.- Official Liquidator (OL): Confirmed no pending litigation or material foreseeable losses for the petitioner companies.- Income Tax Department: Filed reports confirming compliance with statutory liabilities and undertakings by the Transferee Company.6. Treatment of Employees and Legal Proceedings:Clause 11 of the Scheme ensures that all staff and employees of the Transferor Companies will become employees of the Transferee Company without any break in service. Clause 8 states that all legal proceedings will continue and be enforced by or against the Transferee Company.7. Share Exchange Ratio and Valuation:The valuation report proposed the following Share Exchange Ratio:- Mahadev into Aakarshan: 0.0042 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Mahadev.- Soft Vision into Aakarshan: 31.24 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Soft Vision.- Sonoli into Aakarshan: 25.33 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Sonoli.- Sach into Aakarshan: 22.69 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Sach.- Superior into Aakarshan: 11.60 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Superior.- Avancer into Aakarshan: 3.59 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Avancer.- Vidhan into Aakarshan: 0.0042 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Vidhan.- Aaloukik into Aakarshan: 158.69 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Aaloukik.- Paarth into Aakarshan: 1.73 equity shares of INR 10/- each for every 10 equity shares of INR 10/- each of Paarth.8. Final Approval and Conditions for the Scheme of Amalgamation:The Tribunal found no objections to the Scheme and approved it. The order clarified that it does not exempt the payment of any stamp duty, taxes, or other charges. The Transferor Companies No. 1 to 9 shall stand transferred to the Transferee Company. Specific directions were issued regarding the transfer of properties, liabilities, legal proceedings, employees, share allotment, and fee adjustments. The Transferee Company is required to make certain deposits and file certified copies of the order with the Registrar of Companies. Any person interested may apply to the Tribunal for necessary directions.The Tribunal ordered formal issuance of orders upon filing of the schedule of properties by the petitioners.