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2017 (6) TMI 1409 - Tri - Companies LawSanction of Scheme of Amalgamation and Arrangement - Sections 391 to 394 read with Section 100 to 103 of the erstwhile Companies Act 1956 and Sections 230 to 232 read with Section 52 of the Companies Act 2013 - HELD THAT - From the material on record the Scheme appears to be fair and reasonable and is not violative of any provisions of law and is not contrary to public policy. The Scheme iss sanctioned under the relevant sections of the Companies Act 1956 and 2013.
ISSUES PRESENTED and CONSIDERED
The Tribunal considered several core legal questions related to the proposed Scheme of Amalgamation and Arrangement between United Home Entertainment Private Limited (Transferor Company) and Disney Broadcasting (India) Limited (Transferee Company). The issues included:
ISSUE-WISE DETAILED ANALYSIS 1. Compliance with Sections 391 to 394 of the Companies Act 1956 and Sections 230 to 232 of the Companies Act 2013 The Tribunal assessed whether the Scheme adhered to the legal framework provided under the specified sections of the Companies Act. The Petitioner Companies demonstrated compliance by passing board resolutions and filing necessary affidavits, as required by the Tribunal and the Bombay High Court. 2. Impact on Shareholders and Public Interest The Regional Director's report indicated that the Scheme was not prejudicial to shareholders or public interest, save for certain observations. The Tribunal accepted the explanations and undertakings provided by the Petitioner Companies, ensuring that the Scheme was fair and reasonable. 3. Tax Implications and Income-Tax Act Compliance The Tribunal noted the Regional Director's observation that tax implications would be subject to the final decision of Income-Tax Authorities. The Petitioner Companies undertook to comply with all applicable provisions of the Income-Tax Act, which was accepted by the Tribunal. 4. FDI Policy Compliance Concerns were raised regarding foreign/non-resident shareholders and the need for RBI approval. The Tribunal found that the companies were operating under the automatic route of the FDI policy, allowing 100% foreign direct investment. The transfer of shares was an inter-group transaction, and RBI approval was obtained, satisfying the Tribunal. 5. Share Capital Discrepancies The Tribunal addressed discrepancies between the MCA Master data and the Scheme regarding share capital. The Petitioner Companies provided satisfactory explanations, showing that the discrepancies were due to timing differences in the data update. 6. Accounting Treatment Questions arose regarding the accounting treatment of the securities premium account and compliance with accounting standards. The Petitioner Companies clarified that the treatment was in accordance with Section 52 of the Companies Act 2013 and provided an auditor's certificate to support their position. 7. Procedural Compliance The Petitioner Companies confirmed compliance with all procedural requirements as directed by the Tribunal and the Bombay High Court, including filing affidavits and undertaking to meet statutory requirements. SIGNIFICANT HOLDINGS The Tribunal concluded that the Scheme was fair, reasonable, and compliant with legal provisions. Key holdings included:
The Tribunal directed the Petitioner Companies to file the order and Scheme with the concerned authorities and pay costs to the Regional Director and Official Liquidator. The Scheme's approval was subject to the conditions outlined, including compliance with the Ministry of Information and Broadcasting, if necessary.
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