| Scheme of Amalgamation Under Sections 391-394 of the Companies Act 1956 for the amalgamation of BRPL with IndianOil |
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SCHEME OF AMALGAMATION
UNDER SECTIONS 391-394 OF THE COMPANIES ACT 1956
FOR THE AMALGAMATION OF BONGAIGAON REFINERY AND PETROCHEMICALS LIMTIED WITH INDIAN OIL CORPORATION LTD.
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| PART-1 |
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WHEREAS:
A. Indian Oil Corporation Limited ("IOC"or the "Transferee Company") is
a public limited company incorporated under
the Companies Act, 1956, having its registered
office at Indian Oil Bhavan, G-9, Ali Yavar
Jung Marg, Bandra (East), Mumbai - 400051.
IOC is a government company within the meaning
of Section 617 of the Companies Act, 1956
and is under the administrative control
of the Ministry of Petroleum and Natural
Gas, Government of India.
B. IOC is primarily engaged in the business
of refining, pipeline transportation and
marketing of petroleum products.
C. Bongaigaon Refinery And Petrochemicals
Limited ("BRPL" or the "Transferor
Company") is a public limited company
registered under the Companies Act, 1956,
having its registered office at P.O. Dhaligaon,
Dist. Chirang, Assam - 783385. BRPL is a
subsidiary company of IOC and consequently
is a government company within the meaning
of Section 617 of the Companies Act, 1956
and is under the administrative control
of the Ministry of Petroleum and Natural
Gas, Government of India.
D. BRPL is primarily engaged in the business
of refining of crude oil.
E. This Scheme proposes the amalgamation
of BRPL with IOC, which would result in
consolidation of the business of refining
of petroleum products in one entity and
would strengthen the position of the merged
entity i.e. IOC, by enabling it to harness
and optimize the synergies of the two companies.
Accordingly, it would be in the best interests
of BRPL, IOC and their respective shareholders.
The proposed amalgamation of BRPL into IOC
is in line with the global trends to achieve
size, scale, integration and greater financial
strength and flexibility, in the interests
of maximizing shareholder value. The merged
entity i.e. IOC is likely to achieve higher
long-term financial returns than could be
achieved by the companies individually.
IOC and BRPL believe that the financial,
managerial and technical resources, personnel
capabilities, skills, expertise and technologies
of IOC and BRPL pooled in the merged entity,
will lead to increased competitive strength,
cost reduction and efficiencies, productivity
gains, and logistic advantages, thereby
significantly contributing to future growth.
F. The restructuring
and vesting of BRPL into IOC, with effect
from the Appointed Date is in the interest
of the shareholders, creditors, stakeholders
and employees, as it would enable a focused
business approach for the maximization of
benefits to all stakeholders and for the
purposes of synergies of business of IOC
and BRPL.
G. The amalgamation of
BRPL with IOC shall be in accordance with
Section 2 (1 B) of the Income Tax Act, 1961.
H. IOC and BRPL now propose
by this Scheme of Amalgamation (the "Scheme")
to amalgamate BRPL with IOC.
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PART II
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1. DEFINITIONS AND INTERPRETATION
1.1 In this Scheme, unless repugnant to the meaning or context thereof, the following expressions shall have the same meanings given to them below: -
- (a) "Act" means the Companies Act, 1956.
- (b) "Appointed Date" means April 1, 2006.
- (c) "Effective Date" shall have the meaning given to it in Clause 5.9.
- (d) "Scheme" means the Scheme of Amalgamation as set out herein.
- (e)
"Transferor Company" or "BRPL" means Bongaigaon Refinery And Petrochemicals Limited, a government company registered under the Companies Act, 1956, having its registered office P.O. Dhaligaon, Dist. Chirang, Assam-783385 and includes:-
- (i) any and all immovable property, land, buildings, movable assets including plant, machinery and equipments, whether leased or otherwise, any and all rights, title, interest, covenant, undertakings, liabilities including continuing rights, title and interest in connection with the immovable properties whether leasehold or otherwise comprised in this business undertaking together with all present and future liabilities including contingent liabilities and debts appertaining to this business undertaking, as per the records of BRPL;
- (ii) any and all permits, quotas, rights, entitlements, licenses, tenancies. trademarks, servicemarks, patents, copyrights, privileges and benefits of all contracts, agreements and all other rights including lease rights, licenses, powers and facilities of every kind and description whatsoever appertaining to this business undertaking, as per the records of BRPL;
- (iii) any and all debts, borrowings and liabilities, present or future, whether secured or unsecured, pertaining to the business undertaking, as per the records of BRPL.
- (iv) any and all permanent employees of BRPL engaged in or in relation to this business undertaking at their respective offices, branches, factories, depots, or otherwise at their current terms and conditions, as per the records of BRPL;
- (v) any and all earnest monies and/or security deposits, or other entitlements in connection with or relating to this business undertaking, as per the records of BRPL;
- (vi) any and all investments and loans and advances including accrued interest, in connection with or relating to this business undertaking, as per the records of BRPL.
- (f) “Transferee Company” means Indian Oil Corporation Limited, a government company incorporated under the Companies Act, 1956, and having its registered office at IndianOil Bhawan, G-9, Ali Yavar Jung Marg, Bandra (E), Mumbai - 400051, Maharashtra.
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- 1.2 In this Scheme, unless the context otherwise requires:
- (a) references to persons shall include individuals, bodies corporate (wherever incorporated), unincorporated associations and partnerships;
- (b) the headings are inserted for ease of reference only and shall not affect the construction or interpretation of this scheme.
- (c) reference to one gender include all genders; and
- (d) words in the singular shall include the plural and vice versa.
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1.3 Any references in the Scheme to "upon the Scheme becoming effective" or "effectiveness of the Scheme" shall mean the Effective Date.
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1.4 All terms and words not defined in this Scheme shall, unless repugnant or contrary to the context or meaning thereof, have the same meaning ascribed to them under the Act, the Securities Contracts (Regulation) Act, 1956, the Depositories Act, 1996 and other applicable laws, rules, regulations, bye laws, as the case may be, including any statutory modification or re-enactment thereof from time to time.
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2. SHARE CAPITAL
The capital structure of the Transferee and Transferor Company as on March 31, 2006 is as under:
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| IOC |
AMOUNT (Rs.) |
| AUTHORISED SHARE CAPITAL
250,00,00,000 equity shares of Rs. 10/- each
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2500,00,00,000 |
| ISSUED SUBSCRIBED & PAID UP SHARE CAPITAL
1,16,80,12,200 equity share of Rs 10/- each
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1168,01,22,000 |
| BRPL |
AMOUNT (Rs.) |
| AUTHORISED SHARE CAPITAL
20,00,00,000 equity share of Rs. 10/- each
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200,00,00,000 |
| ISSUED SUBSCRIBED & PAID UP SHARE CAPITAL
19,98,17,900 equity share of Rs. 10/- full paid up
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199,81,79,000 |
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| PART III |
3. AMALGAMATION OF BRPL INTO IOC
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A. Transfer and Vesting of the Transferor Company
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3.1 With effect from the Appointed Date and upon the Scheme becoming effective, the Transferor Company shall be vested in and/or be deemed to have been vested in and managed by the Transferee Company, as a going concern, without any further deed or act, together with all its properties, assets, rights, benefits and interest therein, subject to existing charges thereon in favour of banks and financial institutions or otherwise, as the case may be and as may be modified by them, subject to the provisions of this Scheme, in accordance with Sections 391-394 of the Act and all other applicable provisions of law, if any
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3.2 Without prejudice to Clause 3.1 above in respect of such of the assets of the Transferor Company as are movable in nature or incorporeal property or are otherwise capable of transfer by manual delivery or by endorsement and delivery including plant, machinery and equipments, the same shall be so transferred to the Transferee Company and shall upon such transfer become the property and an integral part of the Transferee Company. In respect of such of the said assets other than those referred hereinabove, the same shall, without any further act, instrument or deed, be vested in and / or be deemed to be vested in the Transferee Company in accordance with the provisions of Section 394 of the Act.
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3.3 With effect from the Appointed Date and upon the Scheme becoming effective, the land, together with the buildings standing thereon held by the Transferor Company, and any documents of title / rights and easements in relation thereto shall be vested in and / or be deemed to have been vested in the Transferee Company and shall belong to the Transferee Company. With effect from the Appointed Date, the Transferee Company shall in relation to such properties, be liable for ground rent and municipal taxes. The mutation of title to the immovable properties shall be made and duly recorded by the appropriate authorities pursuant to the sanction of the Scheme and upon the Scheme becoming effective in accordance with the terms hereof in favour of the Transferee Company.
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- 3.4 (a) With effect from the Appointed Date and upon the Scheme becoming effective, all debts, liabilities, duties and obligations, secured or unsecured, and whether or not provided for in the books of accounts of the Transferor Company, whether disclosed or undisclosed in the balance sheet, shall be the debts, liabilities, duties and obligations of the Transferee Company and the Transferee Company undertakes to meet, discharge and satisfy the same.
- (b) Where any of the liabilities and obligations attributed to the Transferor Company on the Appointed Date has been discharged by the Transferor Company after the Appointed Date and prior to the Effective Date, such discharge shall be deemed to have been for and on behalf of the Transferee Company.
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3.5All loans raised and used and liabilities incurred by the Transferor Company after the Appointed Date but before the Effective Date for operations of the Transferor Company shall be loans and liabilities of the Transferee Company.
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3.6 (a) With effect from the Appointed Date and upon the Scheme becoming effective, all contracts, deeds, bonds, agreements, schemes, arrangements and other instruments of whatsoever nature in relation to the Transferor Company, or to the benefit of which the Transferor Company may be eligible, and which are subsisting or having effect immediately before the Effective Date, shall be in full force and effect on or against or in favour of the Transferee Company and may be enforced as fully and effectually as if, instead of the Transferor Company, the Transferee Company had been a party or beneficiary or obligee thereto.
(b) With effect from the Appointed Date and upon the Scheme becoming effective, all rights and licenses relating to trademarks, know-how, technical know-how, trade names, descriptions, trading style, franchises, labels, label designs, colour schemes, utility models, holograms, bar codes, designs, patents, copyrights, privileges and any rights, title or interest in intellectual property rights in relation to the Transferor Company to which the Transferor Company is a party or to the benefit of which the Transferor Company may be entitled / eligible shall be in full force and effect on, or against, or in favour of, the Transferee Company as the case may be, and may be enforced as fully and effectually as if, instead of the Transferor Company, the Transferee Company had been a party or beneficiary or obligee thereto.
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3.7 With effect from the Appointed Date and upon the Scheme becoming effective, all permits, quotas, rights, entitlements, licenses including those relating to tenancies, trademarks, patents, copyrights, privileges, powers, facilities of every kind and description of whatsoever nature in relation to the Transferor Company, to the benefit of which the Transferor Company may be eligible and which are subsisting or having effect immediately before the Effective Date, shall be and remain in full force and effect in favour of or against the Transferee Company, and may be enforced fully and effectually as if, instead of the Transferor Company, the Transferee Company had been a beneficiary or obligee thereto.
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3.8 With effect from the Appointed Date and upon the Scheme becoming effective, any statutory licenses, permissions, approvals, exemption schemes, or consents required to carry on operations in the Transferor Company, respectively, shall stand vested in or transferred to the Transferee Company without any further act or deed, and shall be appropriately mutated by the statutory authorities concerned therewith in favour of the Transferee Company. The benefit of all statutory and regulatory permissions, factory licenses, environmental approvals and consents including the statutory licenses, permissions or approvals or consents required to carry on the operations of the Transferor Company shall vest in and become available to the Transferee company pursuant to the Scheme.
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3.9 The Transferee Company, at any time after the Scheme becoming effective in accordance with the provisions hereof, if so required under any law or otherwise, will execute deeds of confirmation or other writings or arrangements with any party to any contract or arrangement in relation to the Transferor Company to which the Transferor Company is a party in order to give formal effect to the above provisions. The Transferee Company shall, under the provisions of this Scheme, be deemed to be authorized to execute any such writings on behalf of the Transferor Company and to carry out or perform all such formalities or compliances, referred to above, on behalf of the Transferor Company.
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3.10 With effect from the Appointed Date and upon the Scheme becoming effective, the Transferee Company undertakes to have such legal, quasi judicial or other proceedings initiated by or against the Transferor Company, transferred in its name and to have the same continued, prosecuted and enforced by or against the Transferee Company to the exclusion of the Transferor Company, as the case may be. The Transferee Company also undertakes to deal with all legal or other proceedings which may be initiated against the Transferor Company after the Effective Date relating to the Transferor Company in respect of the period up to the Effective Date, in its own name and account and to the exclusion of the Transferor Company, and further undertakes to pay all amounts including interest, penalties, damages, etc. which the Transferor Company may be called upon to pay or secure in respect of any liability or obligation relating to the Transferor Company for the period up to the Effective Date.
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- 3.11 (a) With effect from the appointed date and upon the scheme becoming effective, any and all whole-time Directors including the Managing Director of the Transferor Company as on the effective date shall cease to be a Director on the Board of the Transferor Company. They would be reverted to their substantive positions in the Transferor Company and would become the employees of the Transferee Company on existing or similar terms & conditions as to remuneration and without any break or interruption of service. In the event of any of the whole-time Directors either not having occupied substantive position in the transferor company prior to his appointment as a Director or not willing to continue in the employment of the Transferee company post-merger, then such whole-time Director shall be entitled to compensation from the Transferee company an amount that is equivalent to the amount of remuneration for the balance period remaining of their term of employment under the terms & conditions of employment issued by the Ministry of Petroleum & Natural Gas, Govt. of India.
(b) With effect from the Appointed Date and upon the Scheme becoming effective, any and all employees of the Transferor Company as on the Effective Date shall become employees of the Transferee Company employed on existing or similar terms and conditions as to remuneration, and without any break or interruption of service.
(c) With regard to Provident Fund, Gratuity Fund, Superannuation Fund or any other special fund created or existing for the benefit of such employees of the Transferor Company, it is the aim and intent of the Scheme that all the rights, duties, powers and obligations of the Transferor Company in relation to such schemes or funds shall become those of the Transferee Company. Upon the Scheme becoming effective, the Transferee Company shall stand substituted for the Transferor Company for all purposes whatsoever relating to the obligation to make contributions to the said funds in accordance with the provisions of such schemes or funds in the respective trust deeds or other documents. The existing Provident Fund, Gratuity Fund and Superannuation Fund trusts created by the Transferor Company for its employees shall be continued for the benefit of such employees on the same terms and conditions till such time that they are transferred in the relevant funds of the Transferee Company. It is clarified that the services of all employees of the Transferor Company transferred to the Transferee Company will be treated as having been continuous and uninterrupted for the purpose of the aforesaid schemes or funds.
(d) The Transferee Company undertakes to continue to abide by any agreement(s) / settlement(s) entered into with any labour unions / employees by the Transferor Company. The Transferee Company agrees that for the purpose of payment of any retrenchment compensation, gratuity and other terminal benefits, the past services of such permanent employees, if any, with the Transferor Company, as the case may be, shall also be taken in to account, and agrees and undertakes to pay the same as and when payable.
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3.12 Subject to the other provisions contained in this Scheme, all contracts, business / asset purchase agreements, memoranda of undertakings, memoranda of agreement, memoranda of agreed points, letters of agreed points, arrangements, undertakings whether written or otherwise, lease rights, deeds, bonds, other agreements and instruments of whatsoever nature to which the Transferor Company is a party or having effect immediately before the Effective Date, shall remain in full force and effect against and in favour of the Transferee Company and may be enforced fully and effectually as if, instead of the Transferor Company, the Transferee Company had been a party thereto.
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3.13 The Transferee Company shall be entitled to use the labeling and marking materials for the goods manufactured and packaged which the Transferor Company is entitled to use pursuant to the packing laws and Weights & Measures Laws and other similar laws till such times such packaging materials, labels, wrappers, boxes carrying such labeling rights and disclosures and information in accordance with these laws are exhausted.
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3.14 With effect from the Appointed Date in accordance with the CENVAT Credit Rules 2002 framed under the Central Excise Act, 1944 as are prevalent at the time of sanction of the Scheme, the CENVAT Credit lying unutilized in the Transferor Company, shall stand transferred to the Transferee Company as if the same were the CENVAT credit unutilized in the Transferee Company’s accounts. It is declared that the transfer of the CENVAT Credit stands allowed as stock of inputs as such or in process, including capital goods are also transferred by the Transferor Company to the Transferee Company. The inputs or capital goods on which the credit has been availed of have been duly accounted for.
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3.15 The Transferor Company is entitled to various benefits under incentive schemes and policies under various laws, regulations and notifications. Pursuant to this Scheme it is declared that the benefits under all of such schemes and policies shall be transferred to and vest in the Transferee Company and all benefits, entitlements and incentives of any nature whatsoever including sales tax concessions and incentives shall be claimed by the Transferee Company and these shall relate back to the Appointed Date as if the Transferee Company was originally entitled to all benefits under such incentive scheme and policies, subject to continued compliance by the Transferee Company of all the terms and conditions subject to which the benefits under the incentive schemes and policies were made available to the Transferee Company.
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3.16 Since each of the permissions, approvals, consents, sanctions, remissions, special reservations, backward area sales tax remissions, holidays, incentives, concessions and other authorizations of the Transferor Company, shall stand transferred by the order of the Ministry of Company Affairs, Government of India to the Transferee Company, the Transferee Company shall file the relevant intimations, for the record of the statutory authorities who shall take them on file, pursuant to the vesting orders of the Ministry of Company Affairs, Government of India.
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3.17 For the purpose of giving effect to the vesting order passed under Section 391 and 394 in respect of this Scheme, the Transferee Company shall at any time pursuant to the orders on this Scheme be entitled to get the recordal of the change in the legal right(s)upon the vesting of the Transferor Company in the Transferee Company, in accordance with the provisions of Section 391 and 394 of the Act.
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3.18 With effect from the Appointed Date and up to and including the Effective Date:
- (a) The Transferor Company shall be deemed to have been carrying on and to be carrying on all business and activities relating to the Transferor Company respectively, for and on behalf of and in trust for the Transferee Company.
- (b) All profits accruing to the Transferor Company and all taxes thereof or losses arising or incurred by it relating to the Transferor Company shall, for all purposes, be treated as the profits, taxes or losses as the case may be of the Transferee Company.
- (c) The Transferor Company shall carry on their business activities with reasonable diligence and business prudence and shall not undertake any additional financial commitments of any nature whatsoever, borrow any amounts or incur any other liabilities or expenditure, issue any additional guarantees, indemnities, letters of comfort or commitment either for itself or on behalf of its subsidiaries or group companies or any third party, or sell, transfer, alienate, charge, mortgage or encumber or deal, save and except, in each case, in the following circumstances:
- (i) if the same
is in the ordinary course of business
as carried on by it as on the date of
filing this Scheme with the Ministry
of Company Affairs, Government of India;
or
- (ii) if the same
is expressly permitted by this Scheme;
or
- (iii) if written consent of the Transferee Company has been obtained.
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B. Dissolution of the Transferor Company:
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3.19 Upon the Scheme becoming effective, and from the Appointed Date, the Transferor Company shall stand dissolved without being wound up.
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C. General Terms and Conditions:
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3.20 The Transferor Company has declared and paid dividend on the equity shares of the Transferor Company for the year ending March 31st, 2006 on 15th September, 2006 to the then existing shareholders of the Transferor Company. The Transferee Company has declared and paid dividend on the equity shares of the Transferee Company for the year ending March 31st, 2006 on 28th September, 2006 to the then existing shareholders of the Transferee Company. Any dividend for the current year declared by the Transferee Company prior to the Effective Date of this Scheme shall be paid only to the equity shareholders of the Transferee Company, who are registered as members in the Register of Members of the Transferee Company on the record date determined by the Transferee Company in relation to the payment of such dividend. It is hereby clarified that the equity shareholders of the Transferor Company that become equity shareholders of the Transferee Company upon this Scheme becoming effective and with effect from the Appointed Date, shall not be entitled to claim any such dividend declared by the Transferee Company.
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3.21 Upon the coming into effect of this Scheme the resolutions, if any, of the Transferor Company, which are valid and subsisting on the Effective Date shall continue to be valid and subsisting and be considered as resolutions of the Transferee Company and if any such resolutions have upper monetary or other limits being imposed under the provisions of the Act, or any other applicable provisions, then the said limits shall be added and shall constitute the aggregate of the said limits in the Transferee Company.
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PART IV
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4. ISSUE OF SHARES AND MATTERS RELATING TO ACCOUNTS
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4.1 The Transferee Company may, on the Effective Date, transfer all the shares of the Transferor Company held by it on such date (the “Trust Shares") to an individual trustee or a board of trustees (including the survivors or survivor of any of the trustees comprising such board of trustees) or a corporate trustee (hereinafter referred to as the "Trustees"), to have and to hold the Trust Shares in trust together with all additions or accretions thereto upon trust exclusively for the benefit of Transferee Company and its successor subject to the powers, provisions, discretions, rights and agreements contained in the instrument (the "Trust Deed") establishing the aforesaid trust (the "Trust"). The constitution of the Trust, and the functions and powers of the Trustee shall be set forth in the Trust Deed. The obligations of the Trustees shall stand discharged and the Trust shall stand terminated in accordance with the provisions of the Trust Deed.
For the purpose of this clause, it is hereby clarified that the procedural requirements of the Act, including the passing of resolutions by the Board of Directors, need not be separately complied with/obtained and the required consents shall be deemed to have been given on the sanction of this Scheme.
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4.2 Upon this Scheme coming into effect and upon vesting of the Transferor Company in the Transferee Company, the Transferee Company shall determine a record date ("Record Date") being a date post filing of the sanction order of the Scheme with the Registrar of Companies, Mumbai for ascertaining the eligibility of equity shareholders of Transferor Company to whom fully paid up equity shares of the face value of Rs. 10/- each, at par are to be issued and allotted by the Transferee Company in the following manner:
- (a) The Transferee Company shall (without further application, act or deed) issue at par and allot to the shareholders of the Transferor Company, equity shares in the Transferee Company in the proportion of 4 (four) equity shares of Rs 10/- each in the Transferee Company credited as fully paid up for every 37 (thirty-seven) equity shares of Rs.10/- each held by them in the Transferor Company as on the Record Date.
- (b) No equity shares shall be issued by the Transferee Company to any equity shareholder of the Transferor Company in respect of fractional entitlements, if any, of such equity shareholder, at the time of issue and allotment of equity shares by the Transferee Company. The board of directors of the Transferee Company shall instead consolidate all such fractional entitlements, ignoring any fraction remaining after such consolidation, and thereupon shall issue and allot equity shares in lieu thereof to a director or officer of the Transferee Company or such other person as the board of directors of the Transferee Company shall appoint in this behalf who shall hold such equity shares in trust for all such equity shareholders of the Transferor Company who are entitled to such fractional balances, with the express understanding that such director, officer of the Transferee Company or such other person, who is allotted such consolidated shares, be bound by the express understanding to cause the sale of such shares by a committee of directors, acting in trust on behalf of the equity shareholders of the Transferor Company entitled to the fractional balances. Such sale of shares in the market shall be by the committee of directors at such time(s), at such price(s) and to such person(s) as the committee of directors may deem fit and the net sale proceeds thereof, deposited with the Transferee Company (i.e., after deduction there from of expenses incurred in connection with the sale), shall be distributed by the Transferee Company to the equity shareholders of the Transferor Company (as on the Record Date) in proportion to their respective fractional entitlements.
- (c) The said equity shares in the Transferee Company to be issued to the shareholders of the Transferor Company shall rank pari passu in all respects, except in relation to any dividends declared by the Transferee Company in the manner stated in clause 3.20 above, to the existing equity shares of the Transferee Company from the Appointed Date. Such shares in the Transferee Company to be issued to the shareholders of the Transferor Company will, for all purposes, save as expressly provided otherwise, be deemed to have been held by each such member from the Appointed Date.
- (d) All shareholders of the Transferor Company, whose names shall appear on the Register of Members of the Transferor Company on the Record Date, shall surrender their share certificates for cancellation thereof to the Transferee Company. In default, upon the issue and allotment of new shares to the shareholder of the Transferor Company, whose names shall appear on the Register of Members of the Transferor Company on such date as aforesaid, the share certificates in relation to the shares held by them in the Transferor Company shall be deemed to have been cancelled. All certificates for the new shares shall be sent by the Transferee Company to the shareholders of the Transferor Company at their respective registered addresses as appearing in the Register of Members (or in the case of joint holders to the address of that joint holder whose name stands first in such Register in respect of such joint holding) and the Transferee Company shall not be responsible for any loss in transmission.
- (e) All equity shareholders of the Transferor Company holding their equity shares in the Transferor Company in dematerialized form, as on the Record Date, shall be issued fresh equity Shares in the Transferee Company in dematerialized form.
- (f) On the approval of the Scheme by the members of the Transferee Company pursuant to section 391 of the Act, it shall be deemed that the said members have also accorded their consent under Section 81 (1A) of the Act or other provisions of the Act as may be applicable.
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4.3 In so far as the issue of shares of the Transferee Company to the shareholders of the Transferor Company pursuant to Clause 4.2 is concerned, each shareholder of the Transferor Company shall have the option, to be exercised by way of giving a notice to Transferee Company, on or before such date as may be determined by the Board of Directors of the Transferee Company, to receive the shares either in certificate form or in dematerialized form. In the event that such notice has not been received by Transferee Company in respect of any shareholder of the Transferor Company by the specified date, the shares shall be issued to such members in certificate form. In respect of those shareholders of the Transferor Company exercising the option to receive the shares in dematerialized form, such members shall have opened and maintained an account with a depository participant, and shall provide such other confirmation, information and details as may be required, to the Transf eree Company.
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4.4 The new equity shares of the Transferee Company issued in terms of the Scheme shall, subject to applicable regulations, be listed/admitted to trading on the relevant stock exchange(s) where the equity shares of the Transferee Company are listed/admitted to trading.
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4.5 The exchange ratio stated in Clause 4.2(a) herein, has been determined by the Board of Directors of the Transferee Company and the Transferor Company based on their independent judgement and on the independent valuation.
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4.6 Accounting Treatment
On the Scheme becoming effective, the Transferee Company shall account for the merger in its books as specified hereunder:
- (i) All the assets and liabilities recorded in the books of the Transferor Company shall stand transferred to and vested in the Transferee Company pursuant to the Scheme and shall be recorded by the Transferee Company at their respective book values as appearing in the books of the Transferor Company;
- (ii) On and from the Appointed Date, and subject to any corrections and adjustments as may, in the opinion of the Board of Directors of the Transferee Company, be required the reserves, both capital and revenue, of the Transferor Company, will be merged with those of the Transferee Company, in the same form as they appear in the financial statements of the Transferor Company.
- (iii) After the reserves of the Transferor company are merged with the respective balances of the Transferee company as aforesaid, the Board of Directors of the Transferee Company may adjust from such of the merged reserves of the Transferee Company, whether capital or revenue, including share premium, as it deems fit:
- a. Cost of investments of the Transferee Company in the equity share capital of the Transferor Company, which is settled on the Trust in pursuance of Clause 4.1 of the Scheme;
- b. the difference, if any, between the amount of share capital of the Transferor Company and the amount recorded as fresh share capital issued by the Transferee Company on amalgamation.
- (iv) In case of any difference in accounting policy between the Transferor Company and the Transferee Company, the impact of the same till the amalgamation will be quantified and adjusted in the reserves of the Transferee Company to ensure that the financial statements of the Transferee Company reflect the financial position on the basis of consistent accounting policy.
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PART V
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GENERAL TERMS AND CONDITIONS
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- (5.1) The revised accounts of the Transferee Company, as on the Appointed Date, shall be reconstructed in accordance with the terms of the Scheme.
- (5.2) The Transferee Company is expressly permitted to revise its Income Tax returns and related TDS certificates and the right to claim refund, advance tax credits etc. upon this Scheme becoming effective and have expressly reserved the right to make such revisions in the Income Tax returns and related TDS certificates and the right to claim refund, advance tax credits etc. pursuant to the sanction of this Scheme.
- (5.3) With effect from the Appointed Date and upon the Scheme becoming effective, the unabsorbed depreciation and losses of the Transferor Company shall be treated as the unabsorbed depreciation and losses of the Transferee Company as on the Appointed Date and the Transferee Company shall be entitled to carry forward the losses and unabsorbed depreciation of the Transferor Company.
- (5.4) It is clarified that all taxes payable by the Transferor Company from the Appointed Date onwards, including all or any refunds and claims shall, for all purposes, be treated as the tax liabilities or refunds and claims of the Transferee Company. Accordingly, upon the Scheme becoming effective, with effect from the Appointed Date, the Transferee Company, if required, is expressly permitted to revise its sales tax returns, excise, CENVAT returns and other tax returns, and to claim refunds and / or credits, pursuant to the provisions of this Scheme.
- (5.5) Upon the Scheme becoming effective, the Transferee Company, if required, is also expressly permitted to revise its income-tax returns, and to claim the advance tax, withholding tax credits, and such 'other relevant credits of the Transferor Company, pursuant to the provisions of this Scheme.
- (5.6) The Transferee Company and the Transferor Company shall make necessary applications before the Ministry of Company Affairs, Government of India for sanction of this Scheme and any disputes arising out of this agreement shall be subject to the jurisdiction of the Ministry of Company Affairs, Government of India only.
- (5.7) All costs, charges, taxes, including duties, levies and fees and all other expenses, if any, arising out of or incurred in carrying out and implementing the terms and conditions or provisions of this Scheme and incidental to the completion of the amalgamation in pursuance of this Scheme, shall be borne by the Transferee Company.
- (5.8) The Transferee Company and the Transferor Company, through its directors or authorized persons, may in their full and absolute discretion, assent to any alteration or modification to which the Ministry of Company Affairs, Government of India and / or any other Authority may deem fit to approve or impose and may consider necessary to settle any question or difficulty arising under the Scheme or in regard to its implementation or in any matter connected therewith. The Transferee Company and the Transferor Company, through its directors or authorized persons, may also in their full and absolute discretion, withdraw or abandon this Scheme at any stage of the proceedings.
(5.9) The Scheme is conditional and is subject to -
- a. All necessary certified copies of the orders of the Ministry of Company Affairs, Government of India referred to in this Scheme being filed with the Registrar of Companies, Mumbai, Maharashtra and Registrar of Companies, Guwahati, Assam.
- b. The Scheme being agreed to by the respective requisite majorities of the members (either by way of a meeting or a letter of consent from the shareholders) (on behalf of the Transferor Company and the Transferee Company) and the creditors of the Transferor Company and the Transferee Company (except where exempted by the Ministry of Company Affairs, Government of India) under Section 391 of the Act:
- c. Any other sanction or approval of any statutory or regulatory authorities, as may be considered necessary by the board of directors of the Transferor Company or the Transferee Company, being obtained.
The last of the date on which any of the above three events occur shall be the Effective Date.
- 5.10 In the event of this Scheme
failing to take effect finally, this Scheme
shall become null and void and in that case,
no rights and liabilities whatsoever shall
accrue to or be incurred inter-se by the
parties or their shareholders or creditors
or employees or any other person.
- 5.11 No stamp duty is payable on the amalgamation contemplated herein as no stamp duty is payable on an order of the Ministry of Company Affairs, Government of India, sanctioning a scheme of amalgamation.
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