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2025 Supreme(Online)(NCLT) 6129
NATIONAL COMPANY LAW TRIBUNAL
ATUL CHATURVEDI, MEMBER (TECHNICAL), MANNI SANKARIAH SHANMUGA SUNDARAM, MEMBER (JUDICIAL)
M/s Spring City Centre (TRV) Private Limited – Appellant
Versus
M/s Samast Vikas Limited – Respondent
C.A. (CAA) NO. 50/ND/2024
For the Applicants:Mr. P. Nagesh, Senior Advocate, Mr. Suhas Puthige, Advocate
For the Income Tax: Mr. Anurag Ojha, Sr. SC, Ms. Hemlata Rawat, Mr. V. K. Saxena, JSC
For the RD: Mr. Shashi Raj Dara, Joint Director
Sanction for amalgamation granted under the Companies Act to streamline operations and ensure compliance without prejudice to stakeholders.
Headnote:(A) Companies Act, 2013 - Sections 230-232 - Application for amalgamation - The petitioner companies seek sanction for a scheme of amalgamation to consolidate operations, reduce costs, and promote efficiency. The approved scheme facilitates smoother management and compliance, allowing employers and employees to maintain contractual terms. Observations were made regarding statutory dues and classification under tax regulations. (Paras 5, 21, 23, 24)
(B) Statutory compliance - Proper affirmation and compliance with necessary procedural laws as stipulated in law was maintained to ensure no prejudice occurs to stakeholders including tax obligations. (Paras 12, 27)
Facts of the case:
The scheme involves two transferor companies amalgamating into a transferee company to improve operational efficiency and business structure. Shareholding will remain unchanged due to the mutual ownership structure. (Paras 7, 8)
Findings of Court:
The scheme's approval is justified as it promotes long-term benefits and fulfills statutory requirements while maintaining the interests of all stakeholders. (Paras 22, 23)
Issues: Whether the scheme is in the best interest of stakeholders and complies with the legal provisions for amalgamation as per the Companies Act. (Paras 21, 22)
Ratio Decidendi: The amalgamation was sanctioned as it was found beneficial for consolidation and operational efficiency, which outweighs any procedural concerns. The Tribunal emphasized that it is not their role to question the business decisions if made with due diligence by the shareholders. (Paras 21, 23)
Result: The scheme of amalgamation is sanctioned under the provisions of the Companies Act, 2013.
| Table of Content |
|---|
| 1. details on the companies involved in the amalgamation and their capital structure. (Para 1 , 2 , 3) |
| 2. rationale for amalgamation focusing on efficiency and cost reduction. (Para 5) |
| 3. observations on statutory compliance regarding ongoing legal and tax affairs. (Para 12 , 14) |
| 4. court finds amalgamation beneficial and compliant with statutory requirements. (Para 21 , 22) |
| 5. final approval of the scheme with directions for compliance and further procedures. (Para 23 , 24) |
ORDER
PER: ATUL CHATURVEDI, MEMBER (TECHNICAL)
1. The captioned application is a second motion petition jointly filed by the petitioner companies viz., M/s Spring City Centre (TRV) Private Limited (hereinafter referred to as Transferor Company No. 1/Petitioner Company No. 1) and M/s Spring Resorts Private Limited (hereinafter referred to as Transferor Company No. 2/ Petitioner Company No. 2) with M/s Samast Vikas Limited (hereinafter referred to as Transferee Company/Petitioner Company No. 3) under section 230-232 of Companies Act, 2013 , and other applicable provisions of the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 in relation to the Scheme of Amalgamation (hereinafter referred to as the “SCHEME”).
2. As has been stated in the petition, the Transferor Company No. 1/Petitioner Company No. 1 i.e., M/s Spring City Centre (TRV) Private Limited was incorporated on 25.07.2008, under the provisions of the Companies Act, 1956 bearing CIN: U45200DL2008PTC181380, having its registered office at DPT-103, Prime Towers, Okhla Phase-I, New Delhi South Delhi-110020. The Authorized Share Capital of the Transferor Company No. 1/Petitioner Company No. 1 is Rs. 8,40,00,000/- divided into 84,00,000 Equity shares of Rs. 10/- each. The Issued, Subscribed and Paid-up Share Capital is Rs. 8,33,40,000/- divided into 83,34,000 Equity Shares of Rs. 10/- each.
3. The Transferor Company No. 2/Petitioner Company No. 2 i.e., M/s Spring Resorts Private Limited was incorporated on 14.01.2009, under 2 the provisions of the Companies Act, 1956 bearing CIN: U55101DL2009PTC186658 having its registered office at DPT-103, Prime Towers, Okhla Phase-I, New Delhi South Delhi-110020. The Authorized Share Capital of the Transferor Company No. 2/Petitioner Company No. 2 is Rs. 24,90,000/- divided into 2,49,000 Equity shares of Rs. 10/- each. It’s Issued, Subscribed and Paid-up Capital of Transferor Company No. 2 is Rs. 10,00,000/- divided into 1,00,000 Equity Shares of Rs. 10/- each.
4. The Transferee Company/Petitioner Company No. 3 i.e., M/s Samast Vikas Limited was incorporated on 14.06.2006, under the provisions of the Companies Act, 1956 bearing CIN: U70109DL2006PLC149722 having its registered office at DPT-103, Prime Towers, Okhla Phase-I, New Delhi South Delhi-110020. The Authorized Share Capital of the Transferee Company/Applicant Company No. 3 is Rs. 700,00,00,000/- divided into 70,00,00,000 Equity shares of Rs. 10/- each. It’s Issued, Subscribed and Paid-up Capital of Transferee Company is Rs. 3,35,90,98,200/- divided into 33,59,09,820 Equity Shares of Rs. 10/- each.
5. RATIONALE FOR THE SCHEME
In order to consolidate the business at one place and effectively manage the Transferor Companies and Transferee Company as a single entity, which will provide several benefits including streamlined group structure by reducing the number of entities, reducing the multiplicity of legal and regulatory compliances, 3 rationalizing costs, it is beneficial that Transferor Companies be amalgamated with the Transferee Company.
The independent operations of the Transferor Companies and Transferee Company leads to incurrence of significant costs and the amalgamation would enable economies of scale by attaining critical mass and achieving cost saving. The amalgamation will thus eliminate a multi-layer structure and reduce managerial overlaps, which are necessary involved in running multiple entities and also prevent cost duplication that can
