Best Computer Service Private Limited Vs

Subrata Kumar Dash, Member (Technical)

This is a joint second motion application filed  by  Petitioner Companies namely; Best  Computer  Service  Private  Limited  (Transferor Company/Petitioner Company No.1) and K K Printing Machines Manufacturing Co. Private Limited (Transferee Company/Petitioner Company No.2) under Section 230-232 of Companies Act, 2013 (the Act) and other applicable provisions of the Act read with Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 (the Rules).

The Petitioner Companies have prayed for sanctioning of the Scheme of Amalgamation between the respective companies. The said Scheme is attached as Annexure P-1 to the application.

The Petitioner Companies have filed first motion application bearing CA (CAA)No.21/Chd/Hry/2020 before this Tribunal for seeking directions for dispensing with the meetings of Equity Shareholders, Secured and Unsecured Creditors of both the Applicant Companies. The First motion application was disposed of vide order dated 05.03.2021, with directions to dispense with the meetings of Equity Shareholders, Secured and Unsecured Creditors of both the Applicant Companies for the reasons mentioned in the aforesaid orders.

The main objects, date of incorporation, authorized and paid-up share capital, and the rationale of the Scheme had been discussed in detail in the order dated 05.03.2021.

In the second motion proceedings, certain directions were issued by this Tribunal vide order dated 06.08.2021 and the same were compiled and an affidavit of compliance to the order was filed vide diary No.00415/1 dated 21.09.2021. The notice of hearing was published in “Business Standard” (English) Delhi NCR Edition and “Business Standard” (Hindi) Delhi NCR Edition on 14.08.2021. The original copies of the newspapers are attached as Annexure-1 and 2 of the aforesaid affidavit. It has also stated in the affidavit that copies of notices were served upon the (a) Central Government through Regional Director (Northern Region), Ministry of Corporate Affairs, New Delhi; (b) Registrar of Companies, NCT of Delhi and Haryana; (c) the Official Liquidator (attached to Punjab and Haryana High Court; and (d) Income Tax Department through the Nodal Officer-Principal Chief Commissioner of Income Tax, Aaykar Bhawan, Sector 17-E, Chandigarh, by way of hand delivery. Copy of notices issued by petitioner companies evidencing the receipt of notices are attached as Annexure-3, 4, 5 & 6 respectively of the aforesaid affidavit.

It is also deposed by the authorised signatories of the petitioner companies that both the Transferor and Transferee Companies have not received any objection under sub-Section (4) of Section 230 of the Companies Act, 2013. The aforesaid affidavits are filed vide Diary No.00415/1 dated 29.10.2021.

In response to the abovementioned notices, the statutory authorities have furnished their replies.

7.1 Registrar of Companies (RoC)/Regional Director (RD)

The Registrar of Companies (RoC) has along with the report of the Regional Director (RD) has been attached as Annexure - A6 of diary No.00415/8 dated 17.01.2022. The R.D. in its report has observed that as per the report of the Registrar of Companies, the Scheme is silent about following procedures laid down under Accounting Standard-14 read with Section 133 of the Companies Act, 2013 specifically applicable for giving accounting treatment of assets & liablities on merger. Hence, the Petitioner Companies should amend relevant para/clause by inserting provisions laid down in Accounting Standard-14 therein.

7.2   In response to the Report of RoC/RD, the Petitioner Companies have filed short notes vide Diary No.00415/6 dated 06.01.2022 and it is stated that the Petitioner Companies have made necessary amendments by inserting Para 21.1 & 21.4 in the Scheme which read as follows:

“Para 21.1:- On the Scheme becoming effective, the Transferee Company shall follow the accounting standard 14 read with Section 133 of the Companies Act, 2013 or any other relevant or related requirement under the Companies Act, as may be applicable and any amendments thereto, any other relevant standard/provisions issued by the Institute of Chartered Accountants of India as may be applicable in this regard.

Para 21.4:- Upon the Scheme becoming effective, all the assets and liabilities of the Transferor Company shall be recorded by the Transferee Company at their respective book value in compliance of the specific accounting method by pooling of interest method stipulated under Accounting Standard 14 prescribed and effective at that time.”

Thus, the observations of RD/RoC in respect of the petitioner Companies stand satisfied.

7.3 Official Liquidator

The Official Liquidator has filed his report vide Diary No.00415/4 dated 14.10.2021. The relevant parts of the report in respect of Petitioner Company No.1 are extracted below:

“i. The Company does not have any pending litigations which would impact its financial position.

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.”

On a perusal of the report it is seen that the Official Liquidator has made no adverse observation against the petitioner companies.

7.4 Income Tax Department

The Income Tax Department filed its report vide Diary No.00415/7 dated 06.01.2022 and has stated that a demand amounting to Rs.27,650/- for Assessment Year 2012-13 and Rs.730/- for Assessment Year 2019-20 is pending against the Petitioner Company No.2.

7.5 In response to the report of Income Tax Department, the petitioner companies has paid the outstanding demand of the company. The challans/receipts showing the payment of outstanding demand is attached as Annexure-2 of Diary No.00415/06 dated 06.01.2022. The undertaking given by authorised signatory of the Petitioner Company No.2 with regard to payment of any tax liability pertaining to Transferor Company is also attached as Annexure-1 of Diary no.00415/06 dated 06.01.2022.

The certificate of the Statutory Auditors with respect to the Scheme between Applicant-Companies to the effect that the accounting treatment proposed in the Scheme is in compliance with applicable Indian Accounting Standards (Ind AS) as specified in Section 133 of the Act, read with rules thereunder and other Generally Accepted Accounting Principles was filed as Annexure P-9 of the petition.

We have heard the learned Counsel for petitioner companies and learned Senior Standing Counsel for the Income Tax Department and perused the record carefully.

In the context of the above discussion, the Scheme contemplated between the petitioner companies, appears to be prima facie in compliance with all the requirements stipulated under the relevant Sections of the Companies Act, 2013. In the absence of any objections before us and since all the requisite statutory compliance have been fulfilled, this Tribunal sanctions the scheme of amalgamation appended as Annexure “P-1” with the company petition with amend Para 21.1 and Para 21.4 as specified in Diary No.00415/06 dated 06.01.2022.

Notwithstanding the submission that no investigation is pending against the petitioner companies, if there is any deficiency found or, violation committed qua any enactment, statutory rule or regulation, the sanction granted by this Tribunal will not come in the way of action being taken, albeit, in accordance with law, against the concerned persons, directors and officials of the petitioners.

While approving the scheme as above, it is clarified that this order should not be construed as an order in any way granting exemption from payment of stamp duty, taxes or any other charges, if any, payment is due or required in accordance with law or in respect to any permission/compliance with any other requirement which may be specifically required under any law.

THIS TRIBUNAL DO FURTHER ORDER:

(i) That all the property, rights and powers of the Transferor Company be transferred, without further act or deed, to the Transferee Company and accordingly, the same shall pursuant to Sections 230 to 232 of the Companies Act, 2013, be transferred to and vested in the Transferee Company for all the estate and interest of the Transferor Company but subject nevertheless to all charges now affecting the same;

(ii) That all the liabilities and duties of the Transferor Company be transferred, without further act or deed, to the Transferee Company and accordingly the same shall pursuant to Sections 230 to 232 of the Companies Act, 2013, be transferred to and become the liabilities and duties of the Transferee Company;

(iii) That the Appointed Date for the scheme shall be 01.04.2019 as specified in the scheme;

(iv) That the proceedings, if any, now pending by or against the Transferor Company be continued by or against the Transferee Company;

(v) That the employees of the Transferor Company shall be transferred to the Transferee Company in terms of the 'Scheme';

(vi) That the fee, if any, paid by the Transferor Company on its authorized capital shall be set off against any fees payable by the Transferee Company on its authorized capital subsequent to the sanction of the 'Scheme';

(vii) That the Transferee Company shall file the revised memorandum and articles of association with the Registrar of Companies, N.C.T. of Delhi & Haryana and further make the requisite payments of the differential fee (if any) for the enhancement of authorized capital of the Transferee Company; after setting off the fees paid by the Transferor Company;

(viii) That the Petitioner Companies shall, within 30 days after the date of receipt of this order, cause a certified copy of this order to be delivered to the Registrar of Companies for registration and on such certified copy being so delivered, the Transferor Company shall be dissolved without undergoing the process of winding up. The concerned Registrar of Companies shall place all documents relating to the Transferor Company registered with him on the file relating to the said Transferee Company, and the files relating to the Transferor Company and Transferee Company shall be consolidated accordingly, as the case may be;

(ix) That the Transferee Company shall deposit an amount of ₹1,00,000/-(Rupees One Lakh Only) to be paid in favour of “Pay and Accounts Officer, Ministry of Corporate Affairs, New Delhi ” and ₹1,00,000/- (Rupees One Lakh Only) in favour of "The Company Law Tribunal Bar Association" Chandigarh within a period of four weeks from the date of receipt of the certified copy of this order;

As per the aforesaid directions, Form No. CAA-7 of Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, formal orders be issued on the petitioners to the filing of the Schedule of Properties within three weeks from the date of receiving a certified copy of this order.

All the concerned Regulatory Authorities to act on a copy of this order annexed with the Scheme duly authenticated by the Registrar of this Bench.

The certified copy of this order, if applied for, be supplied to the parties, subject to compliance with all requisite formalities.

The Company Petition CP (CAA) No.6/Chd/Hry/2021 is disposed of accordingly.