MISCELLANEOUS SECTION OF COMPROMISE, ARRANGEMENTS AND AMALGMATIONS
MISCELLANEOUS SECTION OF COMPROMISE, ARRANGEMENTS AND AMALGMATIONS
MISCELLANEOUS SECTIONS – COMPROMISE, ARRANGEMENTS AND AMALGMATIONS
POWER OF TRIBUNAL TO ENFORCE COMPROMISE OR ARRANGEMENT [SECTION 231]:
The provisions of section 231 of the Companies Act, 2013 are detailed below:
POINTS
EXPLANATION
1. Power of Tribunal to implement the order:
Where the Tribunal makes an order under section 230 sanctioning a compromise or an arrangement in respect of a company, it:
shall have power to supervise the implementation of the compromise or arrangement; and
may, at the time of making such order or at any time, thereafter, give such directions in regard to any matter or make such modifications in the compromise or arrangement as it may consider necessary for the proper implementation of the compromise or arrangement.
2. Passing of Winding up order by Tribunal:
If the Tribunal is satisfied that the compromise or arrangement sanctioned under section 230 cannot be implemented satisfactorily with or without modifications, and the company is unable to pay its debts as per the scheme, it may make an order for winding up the company and such an order shall be deemed to be an order made under section 273.
3. Retrospective effect of order:
The provisions of this section shall, so far as may be, also
apply to a company in respect of which an order has been made before the commencement of this Act sanctioning a compromise or an arrangement.
REGISTRATION OF OFFER OF SCHEMES INVOLVING TRANSFER OF SHARES [SECTION 238]:
The provisions of Section 238 of the Companies act, 2013 provide for registration of offer of schemes involving transfer of shares.
POINT
EXPLANATION
1. Registration of circular / offer involving transfer of shares [Sub-section (1)]:
In relation to every offer of a scheme or contract involving the transfer of shares or any class of shares in the transferor company to the transferee company under section 235,
every circular containing such offer and recommendation to the members of the transferor company by its directors to accept such offer shall be accompanied by such information and in such manner as prescribed in Rule 28 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016.
every such offer shall contain a statement by or on behalf of the transferee company, disclosing the steps it has taken to ensure that necessary cash will be available; and
every such circular shall be presented to the Registrar for registration and no such circular shall be issued until it is so registered:
Provided that the Registrar may refuse, for reasons to be recorded in writing, to register any such circular which does not contain the information required to be given under clause (a) or which sets out such information in a manner likely to give a false impression and communicate such refusal to the parties within thirty days of the application.
2. Appeal against the order of the Registrar [Sub-section (2)]:
An appeal shall lie to the Tribunal against an order of the Registrar refusing to register any circular under sub-section (1).
3. Penalty for non-registration [Sub-section (3)]:
The director who issues a circular which has not been presented for registration and registered under clause (c) of sub-section (1), shall be liable to a penalty of one lakh rupees.
PRESERVATION OF BOOKS AND PAPERS OF AMALGAMATED COMPANIES [SECTION 239]:
According to Section 239 of the Companies Act, 2013, the books and papers of a company which has been amalgamated with, or whose shares have been acquired by, another company under this Chapter shall not be disposed of without the prior permission of the Central Government and before granting such permission, that Government may appoint a person to examine the books and papers or any of them for the purpose of ascertaining whether they contain any evidence of the commission of an offence in connection with the promotion or formation, or the management of the affairs, of the transferor company or its amalgamation or the acquisition of its shares.
LIABILITY OF OFFICER IN RESPECT OF OFFENCES COMMITTED PRIOR TO MERGER, AMALGAMATION ETC.
Retrospective effect of liability: Section 240 of the Companies Act, 2013 states that notwithstanding anything in any other law for the time being in force, the liability in respect of offences committed under this Act by the officers in default, of the transferor company prior to its merger, amalgamation or acquisition shall continue after such merger, amalgamation or acquisition.
