2022 (7) TMI 244 - Tri - Companies Law

Tribunal Approves Amalgamation Scheme: Assets, Liabilities & Employees Transferred

The Tribunal sanctioned the Scheme of Amalgamation, finding it beneficial and compliant with statutory requirements. The orders included the transfer of ... Approval of the Scheme of Amalgamation - Section 230 to 232 and other applicable provisions of the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 - HELD THAT:- After analysing the Scheme in detail, this Tribunal is of the considered view that the scheme as contemplated amongst the petitioner companies seems to be prima fade beneficial to the Company and will not be in any way detrimental to the interest of the shareholders of the Company. In view of the absence of any other objections having been placed on record before this Tribunal and since all the requisite statutory compliances having been fulfilled, this Tribunal sanctions the Scheme of Amalgamation as well as the prayer made therein. The scheme is approved - application allowed. Issues:Approval of Scheme of Amalgamation under Sections 230-232 of the Companies Act, 2013.Detailed Analysis:1. First Motion Application:The Transferor and Transferee Companies filed a motion seeking directions for dispensing with the meeting of Equity Shareholders and holding meetings of Secured and Unsecured Creditors. The Tribunal issued directions for meetings, leading to the filing of the second motion petition for sanction of the Scheme of Amalgamation.2. Rationale of the Scheme:The Scheme aimed to reduce administrative costs, overheads, and procedural work, optimizing profitability and reducing inefficiencies. It was deemed beneficial for shareholders, creditors, employees, and the public.3. Compliance with Tribunal's Directions:The Petitioner Companies complied with the Tribunal's directions by serving notices to statutory authorities and publishing in specified newspapers. Responses from authorities indicated no objections to the Scheme.4. Reports from Statutory Authorities:The Regional Director highlighted concerns regarding the appointed date and changing the name of the Transferee Company. The Official Liquidator's report confirmed no adverse findings. The Income Tax Department did not raise objections, and other authorities remained silent.5. Valuation Report:The Valuation Report supported a share exchange ratio of 19.41:1, indicating equitable consideration for shareholders in the amalgamation.6. Accounting Treatment:The Scheme's Accounting Treatment was certified to comply with Indian Accounting Standards by the Statutory Auditors of the Petitioner Companies.7. Tribunal's Observations:After detailed analysis, the Tribunal found the Scheme beneficial and not detrimental to shareholders. It sanctioned the Scheme, emphasizing compliance with statutory requirements and reserving rights for future actions against any violations.8. Tribunal's Orders:The Tribunal ordered the transfer of assets, liabilities, and employees, setting the appointed date as April 1, 2021. It directed the name change of the Transferee Company and filing of necessary documents with the Registrar of Companies. The dissolution of the Transferor Company and consolidation of files were also specified.9. Conclusion:The Company Petition was allowed based on the terms outlined in the Tribunal's orders, ensuring the seamless implementation of the approved Scheme of Amalgamation.