TaxTMI 
TaxTMI 
2024 (8) TMI 408
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..../w Ms. Karuna Yadav. ORAL JUDGMENT (PER K. R. SHRIRAM) : - 1. Considering the facts and circumstances of the case, with consent of Counsel, we have decided to dispose the petition at the admission stage itself. 2. Rule. Rule made returnable forthwith. Respondents waive service. 3. Five petitioners are companies with common Directors and Shareholders. Petitioner nos. 2 to 5 are wholly-owned subsidiary companies of petitioner no.1. Petitioners are aggrieved by an order dated 12th November 2018 passed by respondent no.2, i.e., Regional Director, Western Region, Mumbai, rejecting the application of petitioners for processing the scheme of amalgamation between petitioner nos.2 to 5 with petitioner no.1. 4. It is petit....
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....d in this petition, rejected the application of petitioners submitted under Section 233 of the Companies Act for the scheme of amalgamation on the sole ground that petitioner nos.2 to 5 are not solvent as per the balance sheet as on 31st March 2017. 9. Mr. Petkar submitted that the order has been passed by respondent no.2 without any authority of law because under Section 233 of the Companies Act, the Regional Director, viz., Respondent no.2 could not have passed the order of rejection. Mr. Petkar submitted that if respondent no.2, after receiving any objection/suggestion or for any reason, is of the opinion that such a scheme is not in the public interest or interest of the creditors, respondent no.2 ought to have filed an application b....
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....and suggestions received are considered by the companies in their respective general meetings and the scheme is approved by the respective members or class of members at a general meeting holding at least ninety per cent. of the total number of shares ; (c) each of the companies involved in the merger files a declaration of solvency, in the prescribed form, with the Registrar of the place where the registered office of the company is situated; and (d) the scheme is approved by majority representing nine-tenths in value of the creditors or class of creditors of respective companies indicated in a meeting convened by the company by giving a notice of twenty-one days along with the scheme to its creditors for the purpose or o....
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....direct accordingly or it may confirm the scheme by passing such order as it deems fit: ..............................................." 13. Sub-section (1) of Section 233 prescribes the pre-conditions for parties to comply with before entering into the scheme of merger or amalgamation. These pre-conditions as quoted above in Section 233 (1) have been complied with. Sub-section (2) of Section 233 prescribes for the Transferee Company to file a copy of the scheme so approved in the manner as may be prescribed with the Central Government, the Registrar and the Official Liquidator where the registered office of the company is situated. Undisputably, this has also been complied with. Sub-section (3) of Section 233 provides for ....
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....ed under clause (d) of subsection (1) of Section 233 have approved in writing the scheme. In the case at hand, the only document is the impugned order dated 12th November 2018. The short order reads as under : "Sir, With reference to the subject cited above, I am to draw your kind attention towards Rule 25(2) of the Companies (Compromises, Arrangements & Amalgamations) Rules, 2016 which provides as follows : For the purpose of clause (c) of sub-section (1) of section233 of the Act the declaration of solvency shall be filed by each of the companies involved in the scheme merger or amalgamation in Form No. CAA 10 alongwith the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014 before conven....