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2025 Supreme(Online)(NCLT) 2169
NATIONAL COMPANY LAW TRIBUNAL
Shri Prabhat Kumar, Justice V.G. Bisht (Retd.), JJ
Global Copper Private Limited – Appellant
Versus
Ram Ratna Wires Limited – Respondent
C.A.(CAA)/248(MB)/2024
For the Appellants/Petitioners: Mr. Hemant Sethi, Tanaya Sethi
For the Respondents: Mr. Bhagwati Prasad
The court sanctioned the Scheme of Amalgamation between two companies, emphasizing compliance with statutory provisions and the assumption of tax liabilities by the transferee company.
Headnote:(A) Companies Act, 2013 - Sections 230 and 232 - Scheme of Amalgamation - The Scheme involves the merger of Global Copper Private Limited with Ram Ratna Wires Limited, with no objections raised by any party - The rationale includes operational synergies, improved market position, and enhanced shareholder value - The Scheme is compliant with statutory requirements and is sanctioned with an appointed date of 01 April 2024. (Paras 2, 5, 13, 15, 16)
(B) Tax Liabilities - The transferee company assumes liabilities for pending tax demands of the transferor company, ensuring no adverse impact on stakeholders. (Paras 11, 12)
Facts of the case:
The Scheme of Amalgamation is between two companies engaged in the manufacturing of copper products, approved by their respective Boards and compliant with statutory requirements. No objections were raised against the Scheme. (Paras 1, 2, 5)
Findings of Court:
The Scheme is deemed fair and reasonable, fulfilling all legal requirements, and is sanctioned. (Paras 13, 15)
Issues: Main issues include the compliance with statutory provisions and the impact of amalgamation on tax liabilities. (Paras 10, 11)
Ratio Decidendi: The court found the Scheme beneficial for operational efficiencies and market position, with no prejudice to creditors or stakeholders, while ensuring compliance with tax obligations. (Paras 12, 13)
Result: The Scheme is sanctioned, and the transferor company is dissolved without winding up.
| Table of Content |
|---|
| 1. amalgamation scheme overview (Para 1 , 2 , 3) |
| 2. rationale for amalgamation (Para 4 , 5) |
| 3. compliance with legal requirements (Para 6 , 7 , 8) |
| 4. satisfactory explanations and no objections (Para 9 , 10 , 12) |
| 5. tax implications of amalgamation (Para 11) |
| 6. fairness and legality of the scheme (Para 13 , 14) |
| 7. sanction and dissolution order (Para 15 , 16) |
| 8. regulatory compliance post-order (Para 17 , 18 , 19) |
ORDER
1. Heard Learned Counsel for the Petitioner Companies. No objector has come before this Tribunal to oppose the Scheme nor has any party controverted any averments made in the Petition, except otherwise stated.
2. The present Scheme is the Scheme of Amalgamation (merger by absorption) between Global Copper Private Limited (Transferor Company”) with and into Ram Ratna Wires Limited (Transferee Company”) and their respective shareholders (‘Scheme’), under the provisions of Section 232 r/w Section 230 and other applicable provisions of the Companies Act, 2013 and Rules framed there under as in force from time to time.
3. The Board of Directors of the Petitioner Companies in their respective board meetings held on 13th June 2024 has passed a resolution approving the Scheme. The Appointed Date fixed for the Scheme of Amalgamation is 01 April 2024.
4. The First Petitioner Company is engaged in the business of manufacturing and dealing in Copper Seamless Tubes, Level Wound Coils (LWC), Pancake Coils (PCC), and Straight Copper Tubes, etc. The Second Petitioner Company is engaged in the business of manufacturing of super enamelled copper winding wires and strips, enamelled aluminium wires and strips, submersible winding wires, fiber glass covered copper and aluminium strips, paper cover round wires, braided wire, self-bonding wire, etc. The equity shares of the Second Petitioner Company are listed on BSE Limited and National Stock Exchange of India Limited. The First Petitioner Company is a subsidiary of the Second Petitioner Company.
5. The rationale of the Scheme is as follows:
Both the companies are part of the same management group viz. RR Global which is one of the leading conglomerates in the electrical and copper industry. RRWL, the Transferee Company is one of the leading manufacturers of super enamelled copper wires in India. It is the holding company of the Transferor Company holding 60% of the equity share capital of the Transferor Company. GCPL, the Transferor Company is India’s leading manufacturer of Level Wound Coils (LWC), Pancake Coils (PCC) and Straight Copper tubes as well as seamless copper tubes. Thus, the commercial activities of both the companies are complimentary in nature.
As a result of recent government policies like imposition of Anti- subsidy Duty as well as introduction of Production Linked Incentive Scheme, it is anticipated that the manufacturing activity of air conditioners with demand of copper tubes has a very bright future. It has been realised by the Board of Directors of both the Petitioner Companies that the amalgamation shall be immensely helpful under these circumstances and will also help to streamline the current organization structure and realize commercial synergies thereby achieving following objectives:
i. The proposed amalgamation will offer an immense opportunity to consolidate the portfolio of products that are relevant to the industry under a single roof;
ii. The proposed amalgamation will facilitate better reach in terms of various customer base and will provide a stronger market position to the merged entity;
iii. The proposed amalgamation will result in operational synergies and efficiency for the merged entity. Accordingly, the Scheme would strengthen and complement the businesses of the companies;
iv. The Scheme would help in achieving synergies in business operations and streamlining the business activities for the companies, combining the following activities which would result in significant growth in business:
a. material procurement; b. storage and dispatches;
c. i
