TMI Blog2020 (2) TMI 761X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany then the company can be merged in another company as per Section 232 of the Act, 2013 - Section 55 to Section 57 of Chapter X of Limited Liability Partnership Act,2008 provides conversion from firms, private company and unlisted public company into limited liability partnership. NCLT rightly held that Act 1956 provides that any body corporate can merge into a company. However Act 2013 provides that foreign company or body corporate incorporated outside India can be merged into a Indian company. Applicability of principal of casius omissus - HELD THAT:- On reading of the provisions of Act 2013 as a whole in reference of conversion of Indian LLP into Indian company there is no ambiguity or absurdity or anomalous results which could not have been intended by the legislature. The principal of casus omissus cannot be supplied by the Court except in the case of clear necessity and when reason for it is found in the four corners of the statute itself. There is no such occasion to apply the principal of casus omissus. Thus we are unable to convince with the interpretation of NCLT. The legislature has enacted provision in the Companies Act, 2013 for conversion of Indian L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 394(4)(b) of companies Act, 1956 (in brief Act 1956) LLP can be merged into company but there is no such provision in the Act, 2013. However, explanation of sub section (2) of Section 234 Act 2013 permits a foreign LLP to merge with an Indian company, then it would be wrong to presume that the Act, 2013 prohibits of a merger of an Indian LLP with an Indian company. Thus there does not appear any express legal bar to allow merger of an Indian LLP with an Indian company. Therefore, NCLT applying the principal of Casus Omissus, by the impugned order allowed the amalgamation of Transferor LLP with transferee company. 4. Being aggrieved the appellants have filed the present appeal. 5. Issue for consideration before us that by applying the principal of casus omissus a Indian LLP incorporated under the LLP Act 2008 can be allowed to merge into a Indian Company incorporated under the Act, 2013. 6. Learned counsel for the appellants submits that as per Section 232(i)(a) of Act, 2013 a company can be merged with another company. Company is defined under Section 2(20) means company incorporated under this Act or under any previous Company Law. It is further submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n application is made to the Tribunal under section 230 for the sanctioning of a compromise or an arrangement proposed between a company and any such persons as are mentioned in that section, and it is shown to the Tribunal- (a) that the compromise or arrangement has been proposed for the purposes of, or in connection with, a scheme for the reconstruction of the company or companies involving merger or the amalgamation of any two or more companies; and (b) that under the scheme, the whole or any part of the undertaking, property or liabilities of any company (hereinafter referred to as the transferor company) is required to be transferred to another company (hereinafter referred to as the transferee company), or is proposed to be divided among and transferred to two or more companies, the Tribunal may on such application, order a meeting of the creditors or class of creditors or the members or class of members, as the case may be, to be called, held and conducted in such manner as the Tribunal may direct and the provisions of sub-sections (3) to (6) of section 230 shall apply mutatis mutandis. (2) Where an order has been made by the Tribunal under sub-section ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of LLP into company. In this regard Section 366 of the Act, 2013 provides that for the purpose of Part I of Chapter XXI the word company includes any partnership firm, limited liability partnership, cooperative society, society or any other business entity which can apply for registration under this part. It means that under this part LLP will be treated as company and it can apply for registration and once the LLP is registered as company then the company can be merged in another company as per Section 232 of the Act, 2013. 12. Section 55 to Section 57 of Chapter X of Limited Liability Partnership Act,2008 provides conversion from firms, private company and unlisted public company into limited liability partnership 13. In such a situation it is implicitly clear that the legislature has enacted provisions in Act, 2013 for conversion from the Indian LLP into Indian company and LLP Act 2008 provides conversion from Firm, Private company and unlisted public company into LLP. 14. Sub Section (4)(b) of Section 394 Act 1956 read as under:- transferee company does not include any company other than a company within the meaning of this Act, but transferor company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sult , said Danckwerts, L.J. in Artemiou V. Procopiou (All ER p. 544 I), is not to be imputed to a statute if there is some other construction available . Where to apply words literally would defeat the obvious intention of the legislation and produce a wholly unreasonable result we must do some violence to the words and so achieve hat obvious intention and produce a rational construction. (Per Lord Reid in Luke V. IRC where AC at p.577 (All ER p. 664 I) he also observed: This is not a new problem, though our standard of drafting is such that it rarely emerges. ) 24.It is then true that, when the words, of a law extend not to an inconvenience rarely happening, but do to those which often happen, it is good reason not to strain the words further than they reach, by saying it is cause omissus, and that the law intended quae frequentius accident . But , on the other hand, it is no reason, when the words of a law do enough extend to an inconvenience seldom happening, that they should not extend to it as well as it happened more frequently, because it happens but seldom A casus omissus ought not to be created by interpretation, save in some c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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