The Gujarat High Court on Tuesday sanctioned the amalgamation of Mauritius-based Growmore Trade and Investment Private Limited (GTIPL) with Adani Power Ltd.
A division bench of Justices R R Tripathi and N VAnjaria approved the scheme of amalgamation after overruling the earlier order of a single judge which had called for additional details and reports from various investigating agencies before awarding sanction.
APL had obtained a stay on the implementation of single judge order and also challenged it before the division bench.
The Single judge in April had ordered that further opinion of investigating agencies like the Enforcement Directorate (ED), Directorate of Revenue Intelligence (DRI) and the Income Tax department was need on the grounds that GTIPL, which is based in tax heaven Mauritius, did not have any assets.
The agencies were asked to give their opinions in 40 days with regard to the legality of the proposed merger, GTIPL's conduct, business and affairs, its holding company, and its compliance with various laws, rules and guidelines of the government. The court had further said that it would be open to the office of Enforcement Directorate and Income Tax Department to seek comments from RBI.
The court said that there did not appear any ground to justify any reservation on exchange ratio as it was approved by majority of shareholders. Even one of the shareholders had opposed the amalgamation in the court on the ground that GTIPL was based in a tax haven country Mauritius and it did not have any business income.
"So as to remove any doubt or reservation and to ensure that there may not be any breach of any provision of any applicable laws, Rules, policy, etc. or any illegality or irregularity, more particularly in view of the fact that the shares of the transferee company are proposed to be issued and allotted in the above mentioned ratio to the members of the transferor company which has no assets, the Court has considered it appropriate to pass final order only after and subject to the reports/views from the concerned and competent authority," the court had observed.
The court had also directed APL to apply for and obtain, within prescribed time limit and in prescribed manner, all necessary permission, licences, registrations and certificates, required under all relevant and applicable laws, rules and regulations. The company had challenged this order.
