The Principal Bench of the National Company Law Appellate Tribunal (NCLAT) held that the National Company Law Tribunal (NCLT) has supervisory role when statutory requirements of amalgamation scheme satisfied.
The appellant is aggrieved of the fact that the NCLT while admitting the scheme of arrangement between the parties has unilaterally changed the appointed date from 1.4.2019 to 1.4.2020. It was submitted the Appellant No.1 is a wholly owned subsidiary of Appellant No.2 and was interalia engaged in the business of construction, development, and sale of commercial and residential real estate projects.
The NCLT, thereafter, in consideration of the approval of shareholders of the Appellants and basis the report of the applicable regulatory authorities, approved the Scheme of Amalgamation of Marathon Nextgen Townships Private Limited with Marathon Nextgen Realty Limited (“Scheme”) vide its order dated July 14, 2023. The Hon’ble NCLT, however, while approving the Scheme directed the Appellants to revise the Appointed Date from April 01, 2019, to April 01, 2020, without providing any cogent reasons. It held “the appointed date” is proposed as 01.04.2019 which is ante dated more than 2 years. Hence the appointed date be amended to 01.04.2020.
A Two-Member Bench comprising Justice Yogesh Khanna, Member (Judicial) and Ajai Das Mehrotra, Member (Technical) observed that “the scheme of arrangement if the Court comes to a conclusion that the provisions of statute have been complied with; and that there is no violation of any provision of law, or the proposed scheme of compromise or arrangement is not unquestionable, unconscionable or contrary to public policy, then the NCLT has no further jurisdiction to sit in appeal over the commercial wisdom of the class of person who with their eyes open have given their approval, even if, the Court is of the view that better scheme could have been framed.”
“Further we also agree the alterations in the Appointed Date would affect the calculation and would have a serious financial implication. Hence if the parameters for sanctioning the scheme are complete, then the Tribunal would only be left with supervisory jurisdiction” the Bench held.
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