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CS Professional · Corporate Restructuring, Valuation and Insolvency · Cross Border Mergers

Bharat Foods Ltd proposes to merge with Tasman Foods Ltd, incorporated in a country that the Central Government has not notified for the purposes of section 234(1). Applying the section, what is the position?

The country does not qualify. Section 234(1) applies the Chapter's merger provisions only to companies incorporated in jurisdictions of countries notified by the Central Government, so a scheme with a company from an un-notified country cannot proceed under this route.

  1. AThe Chapter's merger provisions apply to such schemes only for companies in jurisdictions notified by the Central Government, so this country does not qualifyCorrect
  2. BThe merger provisions apply to all foreign countries automatically
  3. CThe Tribunal can notify the country at the time of sanction
  4. DThe Registrar of Companies can notify the country for the particular scheme

Explanation

Section 234(1) extends the Chapter mutatis mutandis to mergers between Indian companies and companies incorporated in jurisdictions of countries notified by the Central Government. A country that has not been notified falls outside this route. The Tribunal and Registrar have no power to notify.

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