TaxTMI 
TaxTMI 
2021 (1) TMI 720
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....ts & Amalgamations) Rules, 2016. The purpose of the Company Petition is to obtain sanction of the Scheme of Amalgamation (in short, "Scheme") by virtue of which Midland Services Limited (hereinafter referred to as "Transferor/Petitioner Company") is proposed to be amalgamated with Amanaya Ventures Limited (hereinafter referred to as "Transferee Company") as a going concern. 2. The Transferor/Petitioner Company is a Public Limited Company and was incorporated under the Companies Act, 1956 on 09.04.1985, and engaged in the business of buyers, sellers, importers, exporters, agents, dealers, suppliers, commission agent, etc. and having its registered office at 816, Vishwa Deep Building, 8th Floor, District Center, Janak Puri, New Delhi - 110....
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....Petitioner Company submitted that the proposed amalgamation of the Transferor Company into the Transferee Company would inter-alia result in the alignment of business of the Transferor Company and the Transferee Company as both the Companies are in the same line of business thereby resulting in rationalization and standardization of the business processes, economics of scale, reduction in overheads, administrative, managerial and other expenditure, organizational efficiency, and optimal utilization of resources which would be beneficial for all members and other stakeholders. He has further submitted that the proposed scheme would be in the interest of both the Companies and their respective Shareholders and other Stakeholders and will not ....
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.... that he has not received any complaint against the proposed Scheme from any person/party interested in the Scheme in any manner and that affairs of the Petitioner Company do not appear to have been conducted in a manner prejudicial to the interest of its members or to public interest as per the provisions of the Companies Act, 2013 whichever is applicable. 7. It is pertinent to state here that Income Tax Department made the following observations in Para 17 of its report: "According to the information provided in the proposed scheme, equity shares of Transferor Company i.e. Midland Services Ltd. were delisted From Metropolitan Stock Exchange of India Ltd. (MSEI) w.e.f. 18.10.2018. Sh. Manan Mahajan, the individual controlling t....
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.... In view of the facts mentioned at S. No. 17, it is hereby submitted that approval for amalgamation as sought by the applicant companies should not be granted." 8. In response to' the aforesaid objections Petitioner Company has filed its reply to the objection raised by the IT Department on 5th August, 2019 by way of an Affidavit. It was stated by the Petitioner Company that: "The contention that the Share swap Ratio is disadvantageous for the shareholders of the transferor Company is absolutely misconceived, ill founded, baseless and not supported by any facts. In this regard, it is submitted that: i) the share swap ratio is calculated by the independent professional who is a Category I, Merchant Banker duly r....
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....ad accepted the share exchange ratio worked out by experts and there is no mistake pointed out by the Assistant Commissioner of Income Tax vide his report dated 19.07.2019, then the tax authorities have no right to interfere with the decision of the shareholders." 9. It is observed that no further rejoinder was filed by the IT Department and it seems that the IT Department has no further objections to this Scheme. This Bench vide its order dated 20.05.2020 has directed the Regional Director, Northern Region, to file an additional affidavit explaining all the infirmities raised by the Income Tax Department. 10. The Regional Director, Northern Region vide its Affidavit dated 25.08.2020 has submitted his finding on the directions given b....
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.... submissions. The representative of RD & OL has also confirmed that the Company has followed the due process as per their affidavit. 12. A certificate of Statutory Auditor of the Petitioner Company has been placed on record to the effect that Accounting Treatment proposed in the Scheme of Amalgamation is in conformity with the Accounting Standard notified by the Central Government as specified under the provisions of Section 133 of the Companies Act, 2013. The Appointed date of the said Scheme is 01.04.2018. 13. There is no requirement for any modification and the said Scheme of Amalgamation appears to be fair and reasonable and is not contrary to public policy and not violative of any provisions of law. All the statutory requirements....