The main legal point established is the court's authority to sanction a scheme of amalgamation under Sections 230 to 232 of the Companies Act, 2013, based on the fairness, reasonableness, and compliance with statutory requirements.

Headnote:
Amalgamation - Companies Act, 2013 - The court sanctioned the scheme of amalgamation between two companies under Sections 230 to 232 of the Companies Act, 2013, after finding the scheme fair, reasonable, and in compliance with statutory requirements.
Fact of the Case:

The Petitioner Companies sought the sanction of the court for a scheme of amalgamation between two companies under Sections 230 to 232 of the Companies Act, 2013. The Regional Director and Official Liquidator raised certain observations and queries, which were duly addressed by the Petitioner Companies.
Finding of the Court:

The court found the scheme fair and reasonable, not in violation of any provisions of law, and not contrary to public policy. All requisite statutory compliances were fulfilled, and the Company Petition was made absolute.
Issues: The issues involved the compliance with statutory provisions, observations raised by regulatory authorities, and the fairness and reasonableness of the proposed scheme.
Ratio Decidendi: The court's decision was based on the fairness and reasonableness of the scheme, compliance with statutory requirements, and the absence of violation of any provisions of law or public policy.
Final Decision: The court sanctioned the scheme of amalgamation, fixed the appointed date as 1st April 2022, and directed the Petitioner Companies to file certified copies of the order and the scheme with the concerned authorities within specified timelines.

C.A (C.A.A)/79/MB/2023

In the matter of the Companies Act, 2013

AND

In the matter of Section 230 to Section 232 of the Companies Act, 2013 and other applicable provisions of the Companies Act, 2013 and

Rules framed thereunder.

AND

In the matter of Scheme of Amalgamation between Krishna Bleaching and Dyeing Private Limited (“First Petitioner Company/ “Transferor Company”) and Krishna Processors & Industries Private Limited Private Limited (“Second Petitioner Company/ “Transferee Company”) and their

respective shareholders.

Krishna Bleaching and Dyeing Private Limited ) …First Petitioner Company/

CIN: U17120MH1981PTC023850 ) Transferor Company Krishna Processors & Industries Private Limited) ….Second Petitioner

Company/

CIN: U1721MH2007PTC173343 ) Transferee Company

C.A (C.A.A)/79/MB/2023 First Petitioner Company and Second Petitioner Company are collectively referred as “Petitioner Companies”

Order delivered on 05.03.2024 Coram:

Anil Raj Chellan Kuldip Kumar Kareer Member (Technical) Member (Judicial)

For the Petitioner(s): Counsel, Hemant Sethi For the Regional Director: Mr. Bhagwati Prasad, Additional Director for the Office of the Regional Director, WR, MCA.

Order

Per: Coram

1. Heard the learned counsel for the Petitioner Companies. No objector has come before the Tribunal to oppose the Petition and nor any party has controverted any averments made in the Petition.

2. The sanction of this Tribunal is sought under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 (‘Act’) and in the matter of Scheme of Amalgamation between Krishna Bleaching and Dyeing Private Limited (‘First Petitioner Company’ or ‘the Transferor Company’) and Krishna Processors & Industries Private Limited (‘Second Petitioner Company’ or ‘the Transferee Company’)

and their respective Shareholders (‘the Scheme’ or ‘this Scheme’).

C.A (C.A.A)/79/MB/2023

3. Learned Counsel for the Applicant Companies further submits that the First Petitioner Company is currently not doing any business and the Second Petitioner Company is engaged in the business of textile processing.

4. The rationale of the Scheme is stated as follows: -

a) The Transferor Company is receiving dividend income from the Transferee company for its investment in Transferee Company. The Transferor Company holds 90,000 Equity shares representing 9% of the total issues, subscribed and paid-up share capital of the Transferee Company. With a view to maintain a simple corporate structure and eliminate duplicate corporate procedures it is desirable to merge and amalgamate Transferor Company with Transferee Company. Accordingly, the scheme of Amalgamation (“scheme”) is being presented for amalgamation of the Transferor Company with the Transferee Company and for various other matters consequential, supplemental and/or otherwise integrally connected therewith pursuant to Section 230 to 232 and other relevant provisions of the Companies Act, 2013.

5. The Petitioner Companies have approved Scheme by passing Board Resolution in their Board Meeting held on 28^th January, 2023. The Appointed Date for the Scheme is

1^st April, 2022.

C.A (C.A.A)/79/MB/2023

6. The Regional Director has filed his Report dated 26^th October, 2023 making certain observations. In response to the observation made by the Regional Director, the Petitioner has also given necessary undertakings and clarification vide their rejoinder affidavit dated 28^th November, 2023. The observations made by the Regional Director and the clarifications and undertakings given by the Petitioner Companies are Summarized in the table below: -

C.A (C.A.A)/79/MB/2023 C.A (C.A.A)/79/MB/2023 C.A (C.A.A)/79/MB/2023 C.A (C.A.A)/79/MB/2023 C.A (C.A.A)/79/MB/2023 C.A (C.A.A)/79/MB/2023 C.A (C.A.A)/79/MB/2023 C.A (C.A.A)/79/MB/2023 C.A (C.A.A)/79/MB/2023

7. The Official Liquidator in their report dated 15^th September, 2013 raised query stating that the Transferor Company appears to be a deemed NBFC. The Petitioner C.A (C.A.A)/79/MB/2023 company has filed Affidavit dated 29

Click Here to Read the rest of this document