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2016 (3) TMI 654 - DELHI HIGH COURT

2016 (3) TMI 654 - DELHI HIGH COURT - TMI - Sanction of the scheme of amalgamation - Held that:- In view of the approval accorded to the scheme by the shareholders and creditors of the petitioners and, given the fact, that the concerns of the RD and the OL, as indicated above, have been duly taken care of, in my opinion, there appears to be no impediment in the grant of sanction to the scheme. Consequently, sanction is granted to the scheme in terms of Section 391 and 394 of the 1956 Act. The pe .....

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ly, in terms of the scheme, all liabilities and duties of the transferor company shall stand transferred to the transferee company without any further act or deed. Upon the scheme coming into effect, the transferor company shall stand dissolved without having to follow the process of winding up.

It is made clear, that this order will not be construed as an order granting exemption from : payment of stamp duty or, taxes or, other penalties/ charges, if any, payable, as per the relevant .....

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ologies India Ltd. (i.e. the transferee company / petitioner no.2) under Section 391 and 394 of the Companies Act, 1956 (hereafter referred to as the 1956 Act) to seek sanction of the scheme of amalgamation (in short the scheme). 1.1 The transferor and transferee companies, as referred to above, will be collectively referred to as the petitioners hereafter. 1.2 The registered office of the petitioners are located within the territorial jurisdiction of this court. Hence this court has the jurisdi .....

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ued by the Registrar of Companies, NCT of Delhi and Haryana (in short the ROC). 3. The transferee company, on the other hand, was incorporated prior in point of time i.e. on 03.05.1985 under the name and style: Enexco Consultants Private Limited. Thereafter, the name of the transferee company was changed twice, once to, Enexco Technologies India Private Limited in 1995, and then, with effect from 13.11.1995 to its present name viz., Enexco Technologies India Limited. The registered office of the .....

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012, concerning the petitioners, whereby, the scheme has been approved, are filed with the petition. 6. The petitioners have averred that there are no proceedings pending against them, under Sections 235 to 251 of the 1956 Act. 7. The petitioners had, as indicated above, filed a petition (i.e. the first motion), being: CA(M) No.96/2014, whereby, a prayer had been made for dispensing with, the requirement of convening meetings of shareholders and creditors. 7.1 This court vide order dated 08.09.2 .....

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with the requirement of convening meetings, as prayed, having regard to the fact, that the interest of the creditors (i.e. unsecured) will not be adversely affected and rather would be placed in a better position, vis-a-vis their security post amalgamation. 8. The petitioners, thereafter, filed the instant petition (i.e. the second motion). Notice in this petition was issued on 31.10.2014. Notice was accepted on behalf of the Official Liquidator (OL) and the Regional Director (RD). Furthermore, .....

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aring no. 1/2014. Based on the aforementioned circular, as per the affidavit of the RD, communication was sent to the Income Tax Department seeking its response to the scheme. However, no comment, response of the Income Tax Department has been received in the matter. 10.1 In the affidavit, the RD had adverted to clause 17.2 of part V of the scheme, wherein, it has been stated that in the event of this scheme failing to take effect by 01.04.2013 or by such later date as may be agreed to by the re .....

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it has received information from the ROC vide communication date 27.01.2015 that the petitioners are subsidiaries of Beumer Beteiligungsgesellschaft mbH, located at: Oelder, Strasse-40, 59269, Bechim Germany. Hence the RD in its affidavit indicated that the transferee company be called upon to submit an undertaking to the effect that they would seek necessary approvals as required from Reserve Bank of India (RBI) as required under Foreign Exchange Management Act, 1999 (in short the FEMA) prior t .....

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e asked to comply with the provisions of Section 77 of the 2013 Act, prior to the scheme being sanctioned. 10.4 Furthermore, RD in its affidavit, re-emphasises the provisions of clause 11.3 of the Part-IV of the scheme, wherein, it has been stated that subject to the provisions of this scheme, the transferee company shall abide by the Accounting Standard-14 issued by the Institute of Chartered Accountants of India (ICAI). 10.5 In response to the concerns raised by the RD, the petitioners filed a .....

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it that the transferee company has furnished an undertaking dated 29.04.2015, to the RD, stating therein that subject to the approval and sanction of the scheme by this court, the transferee company shall adhere to and comply with the applicable RBI requirements, under the extant rules and regulations, as may be amended from time to time, if any, for and on behalf of the transferor company. 10.8 Furthermore, the petitioners clearly refute that the transferor company is in violation of section 77 .....

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of the 2013 Act, which creates an obligation to register a charge, was brought into force on 1st April, 2014 and, therefore, the requirement of filing form CHG-1 would apply, only with effect from 01.04.2014. Furthermore, it is averred that since, no charge, whatsoever, has been created by the transferor company, Section 77 of the 2013 Act does not get attracted. Thus, the transferor company, is not required to file form CHG-1. It has been further submitted that even as per section 125 of the 19 .....

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179(3) of the 2013 Act, and therefore, are prima facie in violation of the provisions of Section 117(3) r/w 179(3) of the 2013 Act. 11. The RD in this affidavit though, has taken a stand that in the matter concerning grant of working capital facilities, which is guaranteed by the other entities, there is no requirement to file e-form CHG-1 as per the provisions of Section 77 of the 2013 Act or even as per Section 125 of the 1956 Act. 11.1 In so far as the OL is concerned, he has, inter alia, sou .....

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ny. As per para 10.1.1 of the scheme: 1(one) Equity share of the face value of ₹ 10 each of transferee company with rights attached thereto as mentioned in the scheme, for every 9 (nine) Equity Shares of ₹ 10 each held in the transferor company... 11.2 Furthermore, the OL has averred that this court had vide order dated 08.09.2014 directed the petitioners to issue a specific notice to the secured creditors, who had not submitted their BODs resolution along with the no objection certi .....

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at large. In other words, affairs of the company, according to the OL, did not fall foul of the provisions of the second proviso of Section 394(1) of the Act. 11.4 As regards the concern raised by the OL, in respect of share exchange ratio, the petitioners filed an affidavit dated 29.06.2015, wherein, they have taken a stand that due to an inadvertent error/ oversight made in clause 10.1.1 of the scheme, it has been stated that upon the coming into effect the scheme, the transferee company shall .....

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of 9 (nine) fully paid up shares of the transferee company of nominal value of ₹ 10 each for every 1 (one) share held by them in the transferor company. This is sought to be justified by placing reliance on the copy of the share valuation report placed on record along with CA(M) No. 96/2014. 12. To be noted, the scheme in clause 8.1 of part-II of the scheme provides that the permanent employees of the transferor company who are in its employment as on the effective date shall become the pe .....

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eror company. It is also made clear, that the Income Tax Authorities or the Reserve Bank of India (RBI) or any other statutory authority will be entitled to proceed against the transferee company qua any liability which it would have fastened on to the transferor company for the relevant period, and that, which may arise on account of the scheme being sanctioned. 13.1 Notwithstanding the above, if there is any deficiency found or, any violation committed of any provisions of the RBI Act or any o .....

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perusal of the affidavit of the RD and the OL and the response of the petitioners would show, in nutshell, that the following concerns have been made: (i) With regard to extension of the scheme beyond 01.04.2013: As indicated above, the petitioners have passed a BOD resolution on 18.09.2014 extending the date of the scheme to 01.04.2017 or such as other date as this court may fix while sanctioning the scheme. (ii) In so far as registration of charge under Section 77 of the 2013 Act is concerned .....

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