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Q1. The Company had total Equity Shareholding of 100 lakhs. Outstanding Debt stood at 50 Lakhs as per latest audited BS. The notice asking for vote on the adoption of C&A terms was sent out. Mr. A holding 2 Lakhs of the total debt was against the terms and chose to object. But was dissuaded to do so as he did not hold proper levels of debt. Is this treatment proper?
Q2. In the scheme of acquisition of shares or any class of shares in a company (transferor company) to another company (transferee company) needs approval of _________ of the shares within the time period of _____________ of making offer by the transferee company
3/4th shareholders in value, 120 day
9/10th shareholders, 120 day
9/10th shareholders in value , 4 months
90% shareholders, 120 day
Q3. Would the answer change if the remaining 10% were a part of the new co AB Ltd instead of the90%? If so, what would be the answer?
Yes it would be Amalgamation in Nature of Merger
Yes, it would be both (Merger and Purchase)
Yes, it would be neither (Merger nor Purchase)
No change would occur
Q4. The C&A terms were acceptable to be fair to both the Creditors and the Company. The auditors refused certificate objecting that the same are not in accordance with A.S u/s 133. The Tribunal:
Q5. After the terms of amalgamation were finalised the Book Values of assets appeared differently in the Books of the transferee as the accounting policies followed were shifted from SLM to WDV method of Depreciation. All other conditions were satisfied as needed for the amalgamation to be classified as amalgamation in the nature of merger. Is this:
Amalgamation in Nature of Merger
Amalgamation in Nature of Purchase
Both of these
None of these
Q6. A. Ltd got amalgamated into AB Ltd. All the assets were transferred from A Ltd to AB Ltd. Furniture were not transferred as they were sold and the money from sale was transferred to Shareholders of A Ltd. Was this a:
Amalgamation in Nature of Merger
Amalgamation in Nature of Purchase
Both of these
None of these
Q7. A . Ltd and B. Ltd decided to enter into an Amalgamation to form a new company AB Ltd. Which Company is the transferor company?
A Ltd.
B. Ltd.
A. Ltd & B. Ltd.
AB. Ltd
Q8. Which Company in the above case is the transferee Company?
A Ltd.
B. Ltd.
A. Ltd & B. Ltd.
AB. Ltd
Q9. Non-compliance with Sec 232 pertaining to the procedure of merger shall result to the officer of every (transferor/transferee) Company in:
Imprisonment: <=1yr Or Fine: 1-5 Lakhs Or Both
Imprisonment: <=6mt Or Fine: 1-5 Lakhs Or Both
Imprisonment: <=1yr Or Fine: 1-3 Lakhs Or Both
Imprisonment: <=6mt Or Fine: 1-3 Lakhs Or Both
Q10. In case when a acquirer or group of persons become majority holder b holding 90 % of issued eq share capital: then an offer to the Company of the intention to buy the remaining equity shares shall be made at:
Value determined by the registered valuer
Face Value of share as originally issued adjusted for inflation
Last registered transfer price of an equity share of the Company
At nominal value of Rs.1
Q11. After order of the Tribunal to call upon a meeting of Creditors / Members or class thereof; the “Supplementary Accounting Statement“ shall be required when FY of the merging Co has concluded:
3 months before the meeting to approve scheme is summoned
4 months before the meeting to approve scheme is summoned
6 months before the meeting to approve scheme is summoned
9 months before the meeting to approve scheme is summoned
Q12. A. Ltd. was amalgamated into a new Company called AB Ltd. 90% of the shareholders of A. Ltd holding 10 % shares were also the Shareholders in AB Ltd. Was this a:
Amalgamation in Nature of Merger
Amalgamation in Nature of Purchase
Both of these
None of these
Q13. If in the above case B Ltd held 75000 share instead of 70000 and the balance shareholders (excluding AB Ltd and AC Ltd) held merely 5000 shares, would the amalgamation be :
Amalgamation in Nature of Merger
Amalgamation in Nature of Purchase
Both of these
None of these
Q14. A Ltd was amalgamated into AB Ltd. AB Ltd had held 100 % shares in AC Ltd. Both AB Ltd and AC Ltd held 10000 shares apiece in A Ltd. before the amalgamation took place. A Ltd had 100000 issued shares in total before amalgamation and 70000 shares therein were held by B Ltd who also later became shareholder in AB Ltd under amalgamation. But the shareholders apart from B Ltd. (and excluding AB Ltd. and AC. Ltd) holding 10000 shares did not become shareholders in the new AB. Ltd. Assuming all other conditions for Amalgamation in the nature of merger are fulfilled , would this be:
Amalgamation in Nature of Merger
Amalgamation in Nature of Purchase
Both of these
None of these
Q15. After the terms of amalgamation were finalised the Book Values of assets appeared differently in the Books of the transferee. All other conditions were satisfied as needed for the amalgamation to be classified as amalgamation in the nature of merger. Is this:
Amalgamation in Nature of Merger
Amalgamation in Nature of Purchase
Both of these
None of these
Q16. A meeting of the creditors and any class thereof and the Company was called by the Tribunal. The terms of the scheme of Compromise and arrangement were to be discussed thereat. The total value of the Creditors was 93 lakhs. Out of which creditors of Rs 86 lakhs 49 thousand communicated by affidavit their confirmation to the terms of scheme of Compromise and Arrangement. Can the tribunal dispose off the requirement of Creditors’ meeting?
Yes, as the Companies Act provides for the waiving of a meeting if >= 90 % of the Creditors agree and confirm vide affidavit to the terms of C&A
No, the requirement of a meeting is absolute and under no circumstance can such a requirement be excused with as per the Companies Act, 2013
No, as the value of Creditors exceeds 50 Lakhs, the Companies Act provides compulsory meeting even though a majority of Creditors assent to the C&A terms
No, since 100 % of the Creditors have not assented to the terms of C&A the same cannot be waived off without meeting
Q17. Non-compliance with Sec 232 pertaining to the procedure of merger shall result to the (transferor/transferee) company in:
Fine: 1-5 Lakhs
Fine: 1-10 Lakhs
Fine: 5-25 Lakhs
Fine:1-25 Lakhs
Q18. Which of the following is not circulated at the Meeting called by the Tribunal of the Company and it’s Creditors/ Members and class thereof:
Draft of proposed terms of the scheme
Valuation report of the expert
Explanatory statement on impact of the compromise adopted by Directors
Statement of compliance of scheme as certified by CA/CS/Cost Accountant
Q19. The Company had total Equity Shareholding of 100 lakhs. Outstanding Debt stood at 50 Lakhs as per latest audited BS. The notice asking for vote on the adoption of C&A terms was sent out. Mr. A holding 5 Lakhs of the total Shareholding was against the terms and chose to object. But was dissuaded to do so as he did not hold proper levels of shareholding. Is this treatment proper?
Yes, since the right to object shall exclusively lie with the creditor. The Shareholders cannot object
No, since the Shareholder can object irrespective of the holding in the equity of the Company
Yes, since the right to object shall be available to Shareholders having holding >= 10 % of total eq shareholding only
Yes, since the objection shall be allowed only where there is >= 50% of shareholders of eq shareholding providing assent to the same
Q20. A Ltd was to be amalgamated in AB Ltd. Equity Shareholders holding 90 % shareholding value in A. Ltd. were to be shareholders in AB Ltd. as well. Their dues would be settled by AB Ltd. by issue of equity shares in AB Ltd. and Rs. 2000/- worth of coupons per shareholder to be used at retail outlets of AB Ltd. Balance in fractions, if any, shall be settled by Cash. Considering all other conditions for amalgamation in Nature of Merger are settled would this be:
Amalgamation in Nature of Merger
Amalgamation in Nature of Purchase
Both of these
None of these
