Case Law Details
In para No. 5 of the affidavit dated 12.06.2012, Mr. B.K. Bansal has observed that “para 8.3 of part II of the scheme provides that” any excess in the value of net assets of software undertaking transferred to the resulting company shall be applicable for distribution to the shareholders of the resulting company. In this regard it has been submitted by the learned Regional Director that excess, if any, in the value of the net assets of the software undertaking should be adjusted to the capital reserve as prescribed in AS-14 (i.e. accounting standards) and not to the general reserve as proposed in the scheme of arrangements.” In response to the aforesaid observation it is clarified that AS-14 (i.e. accounting standards issued by the Institute of Chartered Accountants) is applicable only to amalgamations and not to demerger. On a plain reading of the accounting standard under reference, it is clear that the same is applicable only in case of an amalgamation and not in case of demergers. This has also been held by the Gujarat High Court in the case of 2010 1 CLJ 351 tiled Gallops Realty (P) Ltd. Copy of the order has been placed on record.
In view of the above said clarifications, the observations made by the Regional Director no longer survive.
HIGH COURT OF DELHI AT NEW DELHI
Date of Judgment: July 06, 2012
COMPANY PETITION NO. 137/2012
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