TaxTMI 
TaxTMI 
2021 (8) TMI 848
X X X X Extracts X X X X
X X X X Extracts X X X X
....o Power Transmission Private Limited (the "Resulting Company"). 4. The Learned Authorised Representative for the Petitioner Companies states that the Board of Directors of the respective Petitioner Companies at their Board Meetings held on February 21, 2020 approved the Scheme. 5. The Petitioner Companies further submits the rationale for the Scheme is as under: a) The Demerged Undertaking is engaged in business of carrying out repairing work of industrials gearing including, worm, spur, Helical, Bevel, Crane, Lifts, Automobile, and similar, other types of gears, geared motors, Marine gear boxes, Electrical and mechanical variable speed drive, variable speed boxes, industrial transmission roller, conveyor, elevator and link chains and all types of chains, conveyors and elevators, pinbush flexible and geared type couplings sprocket wheels and all types A.C and D.C electric motors. & earning the income therefrom. ("Industrial Gear Box Division"). In addition, it has residual business comprising of contract manufacturing and marketing activities for demerged undertaking ("Remaining Business"). b) The management of Demerged Company is considering to demerge its ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ared type couplings sprocket wheels and all types A.C and D.C electric motors. Eddy current drives and all other allied transmissions machinery and material equipment's and/or Act as manufactures, representatives, merchants, importers, exporters, promoters, commissions and /or selling agents, general agents, in respect of these and any other articles and things and to manufacture hob cutters, worm thread cutter, grinding the gears. 7. The Authorised Share Capital of Petitioner Company No 1 is as under: Particulars Amount in (Rs.) Authorised Capital 10,00,000 Equity Shares of Rs. 10/- each. 1,00,00,000 Total 1,00,00,000 Issued, Subscribed and Paid-up 5,78,823 Equity Shares of Rs. 10/- each 57,88,230 Total 57,88,230 8. The Authorised Share Capital of Petitioner Company No 2 is as under: Particulars Amount in (Rs.) Authorised Capital 10,00,000 Equity Shares of Rs. 10/- each. 1,00,00,000 Total 1,00,00,000 Issued, Subscribed and Paid-up 10,000 Equity Shares of Rs. 10/- each 1,00,000 Total 1,00,000 9. The Learned Authorised Representative for the Petitioner Companies f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....inabove is concerned, we would like to state that as this is a scheme of demerger, AS-14 is not applicable to the scheme. However, petitioner Companies undertakes that it shall pass such accounting entries as may be necessary in connection with the Scheme to comply with all the applicable accounting Standards and generally accepted accounting principles. b) a. As per Definition of the Scheme, "Appointed Date" shall mean the opening of the business hours as on 1st April, 2019 or such other date as may be fixed or approved by the NCLT at Mumbai or such other competent authorities; "Effective Date" shall mean the date or last of the dates on which the certified copies of the orders sanctioning the Scheme, passed by the National Company Law Tribunal or such other competent authority; Further, the Petitioners may be asked to comply with the requirements and clarified vide circular no. F. No. 7/12/2019/CL-I dated 21.08.2019 issued by the Ministry of Corporate Affairs As far as the observation of the Regional Director, as stated in IV(b) of the report and reproduced hereinabove is concerned, the Petitioner Companies undertake to comply all the requirements as specified in the Min....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rector's Report. f) As per Clause 16 of the Scheme to the Accounting Treatment in the books of the Resulting Company "The difference being the excess/deficit of the assets cover liabilities transferred to and recorded by the Resulting Company over the face value of the new equity shares allotted as per 15.2 of the Scheme to the Resulting Company shall be credited to Capital reserve Account in the books of the resulting company. In this regards the company be directed to amend the scheme that the Capital Reserve so created to be named as "Capital Reserve arising out of the Demerger" and that the reserves shall not be available for distribution of dividend As far as the observation of the Regional Director, as stated in IV(f) of the report, Petitioner companies states that since this is a scheme of demerger and as part of scheme, demerged undertaking of the transferor company surplus shall be credited to Capital Reserve account and the Capital Reserve so created shall be named as "Capital Reserve arising out of the Demerger" and that the Reserve shall not be available for distribution of dividend 14. The Bench is satisfied with the explanations and underta....