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Mergers and Acquisitions

Learning Objectives​

By the end of this topic, you should be able to:

  • Distinguish merger, amalgamation, acquisition (takeover), and demerger.
  • Explain the scheme of compromise or arrangement process under Sections 230-232 of the Companies Act, 2013, including the NCLT's role.
  • Describe fast-track mergers (Section 233), cross-border mergers (Section 234), minority squeeze-out (Sections 235-236), and preservation of registers/books (Section 239) and liability of officers (Section 240).
  • Outline the other regulatory layers: SEBI (SAST) Regulations, 2011, Competition Act, 2002 combination control, and stock-exchange/SEBI scheme approval for listed companies.
  • Explain how the IBC, 2016 (especially Section 29A) created a new M&A market for distressed companies.
  • Apply landmark decisions such as Miheer H. Mafatlal v. Mafatlal Industries and Hindustan Lever Employees' Union v. Hindustan Lever to scheme-sanction questions.

Quick Answer​

Mergers and acquisitions are the legal mechanisms by which companies combine or change control. In a merger/amalgamation, two or more companies fuse — the transferor company's assets, liabilities and shareholders move into the transferee, and the transferor dissolves without winding up. In an acquisition, one company simply buys control (shares or assets) of another, which survives. In India, court-supervised combinations run through a scheme of compromise or arrangement under Sections 230-232 of the Companies Act, 2013, sanctioned by the NCLT after approval by a majority in number representing three-fourths in value of each class of members and creditors. Small and group companies can use the fast-track route (Section 233) without the Tribunal. Listed-company takeovers additionally trigger SEBI's Takeover Code, and large deals need Competition Commission clearance. Since 2016, the IBC has made buying distressed companies through resolution plans a major M&A channel.

Overview​

Companies grow in two ways: organically (building) or inorganically (buying). M&A law exists because inorganic growth reshuffles the rights of many people at once — shareholders lose or change their shares, creditors get a new debtor, employees a new employer, and markets a new competitive landscape. Each affected constituency gets its own legal checkpoint.

Think of Indian M&A regulation as four gates a deal may have to pass:

  1. Company law gate — Sections 230-240, Companies Act, 2013: the scheme process before the NCLT, protecting shareholders and creditors through class meetings and Tribunal sanction.
  2. Securities law gate — SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011: acquiring 25% or more of a listed company's voting rights (or control) forces a mandatory open offer to public shareholders for at least 26% more, so exit is offered at the same premium the promoter got.
  3. Competition gate — Sections 5-6, Competition Act, 2002: combinations crossing asset/turnover (or, since 2023, deal-value) thresholds need prior CCI approval and observe a standstill.
  4. Sectoral/tax gates — FDI policy and FEMA for foreign buyers, RBI for banks/NBFCs, and the Income-tax Act (Sections 2(1B), 47, 72A) which makes court-approved amalgamations tax-neutral if conditions are met.

Not every deal passes every gate — a private share purchase may need none of them — but a large listed-company merger can need all four.

Core Concepts​

1. Merger vs. Amalgamation vs. Acquisition vs. Demerger​

Definition: A merger is the fusion of two or more companies into one (A + B → A, an absorption). Amalgamation is the Indian statutory term for the same family, often used where a new company results (A + B → C). An acquisition (takeover) is the purchase of control of a company that continues to exist. A demerger splits an undertaking out of a company into another.

Explanation: The legal signature of merger/amalgamation is universal succession without winding up: by force of the NCLT order under Section 232, all property, rights, liabilities and pending proceedings of the transferor vest in the transferee, contracts continue, and the transferor stands dissolved — no liquidator, no asset-by-asset conveyance. In an acquisition, by contrast, nothing vests automatically; the buyer acquires shares (control changes, company unchanged) or a business undertaking (slump sale). A demerger is the mirror image — the scheme route is the same (Sections 230-232), but assets flow out rather than in.

Example: If Alpha Ltd absorbs Beta Ltd by scheme, Beta's factory, bank loans and pending lawsuits all become Alpha's on the appointed date, Beta's shareholders receive Alpha shares per the exchange ratio, and Beta is dissolved without winding up.

Real-World Example: Vodafone India–Idea Cellular (2018) was a merger creating Vodafone Idea; Walmart's 2018 purchase of ~77% of Flipkart was an acquisition (Flipkart survived, its owner changed); Reliance Industries' hiving-off of Jio Financial Services (2023) was a demerger.

Why It Matters: Every downstream rule — which sections apply, whether an open offer triggers, how tax falls — depends on classifying the transaction correctly first.

Common Misunderstanding: That the transferor company is "wound up" in a merger. It is dissolved without winding up — a critical distinction, because winding up involves a liquidator realising assets, whereas merger transfers everything as a going concern.

2. Scheme of Compromise or Arrangement — Sections 230-232​

Definition: Sections 230-232 provide a single, court-supervised procedure by which a company may enter a compromise or arrangement with its members or creditors (or any class of them), including mergers, amalgamations and demergers.

Explanation: The process runs in stages. (1) Application to the NCLT by the company, any creditor or member (or liquidator, if in winding up), with disclosures of financials, auditor's certificate that the accounting treatment conforms to accounting standards, and any pending investigations. (2) Meetings: the Tribunal orders separate meetings of each class of members and creditors; notice goes to all of them and to regulators — Central Government (Regional Director), RoC, Income-tax, RBI, SEBI, CCI, stock exchanges as applicable — who get 30 days to object. Creditors' meetings can be dispensed with if creditors holding at least 90% in value consent by affidavit. (3) Approval threshold: a majority in number representing three-fourths in value of those present and voting in each class. Objections to the scheme can be raised only by shareholders holding at least 10% or creditors holding at least 5% of total debt — a 2013 Act innovation to stop nuisance objectors. (4) Sanction: the NCLT examines statutory compliance and fairness, then passes orders under Section 232 providing for vesting of assets and liabilities, allotment of shares, continuation of proceedings, employee transfer, and dissolution of the transferor without winding up. The scheme, once sanctioned, binds all members and creditors — including dissenters.

The scope of judicial review was settled in Miheer H. Mafatlal v. Mafatlal Industries Ltd (AIR 1997 SC 506): the court checks that the statutory procedure was followed, the majority acted bona fide and the scheme is not unfair or contrary to law — but it does not sit in appeal over the commercial wisdom of the shareholders. "The court's jurisdiction is supervisory, not appellate." Similarly, Hindustan Lever Employees' Union v. Hindustan Lever Ltd (1995 Supp (1) SCC 499) upheld the HLL-TOMCO merger, holding that a share-exchange ratio fixed by expert valuers will not be disturbed unless shown to be fraudulent or patently unfair, and that employees' objections receive consideration but employees cannot veto a scheme.

Example: Two mid-size pharma companies agree to merge with a 2:3 exchange ratio supported by a registered valuer's report. Equity shareholders and secured creditors approve at NCLT-convened meetings (majority in number + 75% in value each). No regulator objects. The NCLT sanctions; on filing the order with the RoC, the scheme takes effect from the appointed date.

Real-World Example: The HDFC Ltd–HDFC Bank merger (effective 1 July 2023), India's largest, travelled exactly this road: board approvals, RBI/SEBI/CCI/stock-exchange clearances, NCLT-convened meetings, and Tribunal sanction — with HDFC Ltd dissolved without winding up and its shareholders receiving HDFC Bank shares.

Why It Matters: The scheme procedure — thresholds, regulator notice, limited judicial review — is the single most examined block of M&A law, both as a direct question and inside problem scenarios about aggrieved minorities.

Common Misunderstanding: Treating the 75% threshold as "75% of all shareholders." It is a dual test — majority in number and three-fourths in value — of those present and voting in the class meeting, not of the entire register.

3. Fast-Track and Cross-Border Mergers — Sections 233 and 234​

Definition: Section 233 allows a simplified merger without NCLT sanction between two or more small companies, between a holding company and its wholly-owned subsidiary, and between such other classes as prescribed (the rules now extend it to certain startups). Section 234 permits mergers between Indian companies and foreign companies in notified jurisdictions, with prior RBI approval.

Explanation: Under the fast-track route, both companies' members (holding 90% of total shares) and creditors (90% in value) must approve, after inviting objections from the RoC and Official Liquidator; the scheme is then registered by the Central Government (Regional Director). If the RD believes the scheme is against public interest or creditors' interests, it can refer the scheme to the NCLT to be considered under the full Section 232 route. Cross-border mergers under Section 234 (operationalised in 2017) work both ways — inbound (foreign into Indian) and outbound (Indian into foreign, limited to notified jurisdictions) — with FEMA cross-border merger regulations handling currency, securities and asset issues.

Example: A parent absorbs its wholly-owned logistics subsidiary through Section 233: board approvals, member/creditor consents at the 90% level, notice to RoC and OL, RD registration — months faster and far cheaper than an NCLT scheme.

Real-World Example: Group simplification exercises — conglomerates collapsing dozens of dormant wholly-owned subsidiaries into the parent — routinely use Section 233, an efficiency the 1956 Act never offered.

Why It Matters: "Distinguish Section 232 and Section 233 mergers" is a favourite short-note; spotting when fast-track is available saves a client a year of Tribunal timelines.

Common Misunderstanding: Believing fast-track mergers escape scrutiny altogether. The RD, RoC and Official Liquidator all vet the scheme, and the RD can push a problematic scheme back into the NCLT process.

4. Takeovers of Listed Companies — SEBI (SAST) Regulations, 2011 and Squeeze-Outs​

Definition: The SEBI Takeover Code requires anyone acquiring 25% or more of voting rights in a listed company, or acquiring control (by any means), to make a mandatory open offer to public shareholders for at least 26% of the company's shares at a regulated minimum price; creeping acquisition beyond 5% per financial year by existing 25-75% holders also triggers the offer.

Explanation: The Code's philosophy is equality of exit: if a buyer pays a promoter a control premium, public shareholders must get the chance to sell at an equivalent price. Key mechanics: disclosure obligations at 5% and every 2% change thereafter; offer price built from negotiated price, market price and past acquisitions (whichever is highest); a detailed public announcement and letter of offer; and exemptions for inter-se promoter transfers, schemes sanctioned by courts/NCLT, and IBC resolution plans. On the company-law side, Sections 235-236 handle mopping up minorities: Section 235 lets an acquirer who has obtained approval of holders of 90% in value of the shares involved in a scheme acquire dissenting shareholders' shares on the same terms; Section 236 gives a 90% acquirer the right (and minority shareholders a mirror right) to buy out the residual minority at a price determined by a registered valuer.

Example: An acquirer agrees to buy 40% of a listed FMCG company from its promoters. Crossing 25%, it must simultaneously announce an open offer for a further 26% from public shareholders at not less than the promoter deal price.

Real-World Example: The Adani Group's 2022 acquisition of Ambuja Cements and ACC involved open offers to public shareholders under the Takeover Code alongside the purchase of the Holcim stake — a textbook mandatory-offer sequence.

Why It Matters: Takeover regulation is where company law meets securities law; exam problems often hide the 25% trigger or the creeping-acquisition limit inside a shareholding table.

Common Misunderstanding: That the Takeover Code applies to all companies. It applies only to companies with listed equity; control of unlisted companies changes by simple contract, checked only by company-law and competition-law gates.

5. Distressed M&A under the IBC — Section 29A and Resolution Plans​

Definition: Under the IBC, 2016, a company in CIRP is effectively auctioned: resolution applicants bid through resolution plans approved by 66% of the Committee of Creditors and sanctioned by the NCLT (Section 31). Section 29A disqualifies certain persons from bidding — most importantly, undischarged insolvents, wilful defaulters, persons whose accounts are NPAs for a year or more (unless dues are cleared), persons convicted of serious offences, and connected persons of all these.

Explanation: Section 29A (inserted in 2017) answers a moral-hazard question: should promoters who drove a company into insolvency be allowed to buy it back at a discount, washing away its debts? Parliament said no. The provision is drafted expansively ("acting jointly or in concert," "connected person") and the Supreme Court in ArcelorMittal India v. Satish Kumar Gupta (2019) 2 SCC 1 held that courts must pierce corporate veils to catch indirect control by ineligible persons — both ArcelorMittal's and Numetal's initial bids for Essar Steel were tainted by shareholders linked to NPA accounts, curable only by clearing the dues. An approved resolution plan binds all stakeholders including government (Section 31), and CoC of Essar Steel v. Satish Kumar Gupta (2019) confirmed the CoC's commercial wisdom on distribution is near-conclusive. A scheme of arrangement under Sections 230-232 is also possible for a company in liquidation — but the ineligibilities of Section 29A carry over even there (Arun Kumar Jagatramka v. Jindal Steel and Power, 2021).

Example: The promoter of an insolvent textile company routes a bid through his brother-in-law's newly formed LLP. Both are "connected persons" — the bid is invalid under Section 29A.

Real-World Example: Tata Steel's acquisition of Bhushan Steel (₹35,200 crore, 2018) and JSW's acquisition of Bhushan Power & Steel came through IBC resolution plans — the IBC has become one of India's largest M&A marketplaces for stressed assets.

Why It Matters: Modern M&A questions increasingly cross into insolvency; Section 29A plus ArcelorMittal is the most cited combination in recent papers.

Common Misunderstanding: That Section 29A bars all promoters everywhere. It bars specified categories (wilful defaulters, NPA-linked persons, etc.) and their connected persons; a clean promoter of an MSME corporate debtor even enjoys a partial exemption (Section 240A).

Visual Learning​

The NCLT scheme route under Sections 230-232:

Choosing the right M&A route:

Key Terms​

TermDefinitionContext / Related Concepts
AmalgamationStatutory fusion of companies; transferor dissolves without winding upSs.230-232; tax meaning in S.2(1B), Income-tax Act
Scheme of arrangementNCLT-supervised compromise with members/creditorsUmbrella covering mergers, demergers, debt restructuring
Appointed dateDate from which the scheme takes effect (vesting)Distinct from the "effective date" of RoC filing
Share-exchange (swap) ratioNumber of transferee shares issued per transferor shareFixed by registered valuers; HLL Employees' Union
Transferor / transferee companyCompany merging in / company receiving the undertakingTransferor dissolves without winding up
Fast-track mergerNon-NCLT merger for small companies / holding-WOSS.233; 90% consents; RD registration
Cross-border mergerMerger between Indian and foreign companiesS.234 + RBI/FEMA regulations (2017 onwards)
Open offerMandatory offer to public shareholders of a listed targetSEBI SAST 2011: 25% trigger, minimum 26% offer
Creeping acquisitionPermitted 5%/year accretion for 25-75% holdersBeyond 5% → open offer
Squeeze-outCompulsory acquisition of minority sharesS.235 (90% scheme approval); S.236 (90% holder)
DemergerTransfer of an undertaking out of a company by schemeTax-neutral if S.2(19AA) IT Act conditions met
Section 29A (IBC)Disqualification of tainted bidders in insolvency M&AArcelorMittal; extends to liquidation schemes
Combination (Competition Act)Acquisition/merger crossing asset, turnover or deal-value thresholdsPrior CCI approval; gun-jumping penalties
Reverse mergerLarger/profitable company merged into smaller/loss-making oneOften for tax losses (S.72A) or listing status

Common Mistakes​

Mistake 1

  • Misconception: "Section 230 deals with mergers and Section 232 with amalgamations — they are separate procedures for different transactions."
  • Why it's wrong: Section 230 is the general provision for any compromise or arrangement with members or creditors (debt restructurings included); Section 232 adds the machinery — vesting, share allotment, dissolution — when the arrangement involves a merger, amalgamation or demerger. They operate together for a merger, not as alternatives keyed to labels.
  • Correct: A merger scheme is filed under Sections 230-232 read together; "merger" and "amalgamation" are not legally distinct procedures under the Act.

Mistake 2

  • Misconception: "The NCLT can reject a scheme if it thinks the share-exchange ratio undervalues the transferor — it must ensure shareholders get the best price."
  • Why it's wrong: Miheer H. Mafatlal confines the Tribunal to supervisory review: statutory compliance, bona fides, fairness, legality. Valuation is commercial wisdom; a ratio fixed by independent expert valuers and approved by the statutory majority will not be second-guessed absent fraud or patent unfairness (HLL Employees' Union).
  • Correct: The NCLT does not sit in appeal over the majority's commercial judgment; a dissenting shareholder must show illegality, procedural default or manifest unfairness — and must hold 10% to even raise an objection.

Mistake 3

  • Misconception: "After a merger, the transferor company goes into winding up and its liabilities are extinguished."
  • Why it's wrong: Merger is universal succession: all liabilities, guarantees and pending litigation of the transferor vest in the transferee by the Section 232 order; nothing is extinguished, and there is no winding up — the transferor is dissolved by the order itself.
  • Correct: Creditors of the transferor automatically become creditors of the transferee (which is exactly why creditor class meetings and regulator notice are built into the process).

Comparison and Connections​

FeatureNCLT merger (Ss.230-232)Fast-track merger (S.233)Share acquisition (takeover)IBC resolution plan
Forum / approverNCLTRegional DirectorContract (+ SEBI if listed)CoC (66%) + NCLT (S.31)
Target's fateTransferor dissolved without winding upSameSurvives; ownership changesSurvives under new owner per plan
Consent thresholdMajority in number + 75% in value per class90% members and 90% creditorsSeller's consent; open offer to public if listed66% of CoC by voting share
Who is protectedMembers, creditors, regulators, employeesSame, via RD/RoC/OL vettingPublic shareholders (exit at equal price)Creditors (waterfall floor: S.30(2)(b))
Typical timeline9-18 months3-6 monthsWeeks-months (+offer period)180-330 days CIRP
Distinct riskObjections, regulator pushbackRD referral to NCLTOpen-offer cost, gun-jumpingS.29A ineligibility, litigation

Connections: schemes are the constructive counterpart of winding up (restructuring instead of death); the share-exchange ratio links to corporate finance valuation; open offers and squeeze-outs implicate shareholders' rights (minority protection, oppression remedies under Ss.241-242 as an alternative attack on unfair schemes); and CCI review connects company law to competition economics.

Practice Questions​

Recall​

  1. State the approval thresholds required for a scheme of arrangement under Section 230, and who may object to a scheme before the NCLT. Answer guidance: Majority in number representing three-fourths in value of the members/creditors of each class, present and voting; regulators get 30 days' notice; objections only by shareholders holding ≥10% of shareholding or creditors holding ≥5% of total outstanding debt.

  2. Which combinations qualify for the fast-track merger route under Section 233? Answer guidance: Two or more small companies; holding company and its wholly-owned subsidiary; other prescribed classes (certain startups inter se or with small companies). Note 90% member/creditor consent and RD registration, with RD's power to refer to the NCLT.

Understanding​

  1. Explain the scope of the NCLT's jurisdiction when sanctioning a scheme, with reference to Miheer H. Mafatlal v. Mafatlal Industries. Answer guidance: Supervisory checklist: statutory procedure followed; classes fairly represented; majority acted bona fide, not coercing the minority; scheme not contrary to law or public policy; disclosure complete. The court is "not a court of appeal" over commercial wisdom — a scheme a reasonable business person could approve must be sanctioned.

  2. Why does acquiring 25% of a listed company trigger a mandatory open offer? What policy does the rule serve? Answer guidance: 25% is the statutory proxy for de facto control. The rule ensures equality of treatment — public shareholders can exit at a price no worse than the controlling block received (sharing the control premium) — and deters creeping, undisclosed accumulations. Mention disclosure tiers (5%, then 2% changes) and the 26% minimum offer size.

Application​

  1. Prisma Ltd (listed) plans to absorb its wholly-owned subsidiary Quark Pvt Ltd, and separately to acquire 30% of listed Raga Ltd from Raga's promoters. Advise on the routes and approvals for each leg. Answer guidance: Leg 1: holding-WOS merger → Section 233 fast-track available (no NCLT), but as a listed transferee Prisma must also route the scheme through stock exchanges/SEBI (LODR scheme circular) — note no shares are issued for a WOS absorption. Leg 2: crossing 25% of Raga → mandatory open offer for ≥26% under SAST; check creeping limits, disclosure obligations, CCI thresholds and any sectoral caps.

  2. The erstwhile promoter of Sigma Steel (in CIRP) submits a resolution plan through a Mauritius entity owned by his wife's trust. The plan offers creditors 60 paise on the rupee — the highest bid. Can the CoC accept it? Answer guidance: No. Section 29A(c)/(j): the promoter's account was presumably NPA/wilful default territory, and the Mauritius entity is a "connected person"; ArcelorMittal mandates lifting the veil to trace real control. Highest value cannot cure ineligibility; the bid must be rejected unless the disqualification is cured (e.g., NPA dues paid) before plan submission. Mention MSME relaxation (S.240A) as the only carve-out.

Analysis​

  1. "The scheme jurisdiction protects process, not price." Critically examine whether Indian law adequately protects minority shareholders in mergers. Answer guidance: Protections: class meetings, dual-majority threshold, regulator notice, valuation by registered valuers, NCLT fairness review, exit rights (S.235-236 at valuer-determined price), oppression remedy (S.241). Gaps: courts defer on valuation (Mafatlal, HLL); 10% objection threshold silences small holders; promoters often command the 75% majority; squeeze-out pricing disputes. Compare appraisal-rights regimes elsewhere; conclude on whether deference to "commercial wisdom" plus procedural rigour is sufficient.

  2. Compare acquiring a distressed company through an IBC resolution plan with acquiring a healthy company through a Section 232 scheme. Which stakeholder trade-offs differ most? Answer guidance: IBC: creditor-controlled (CoC), debtor's shareholders effectively wiped out with no vote, clean-slate protection under S.31 & S.32A (immunity from prior offences), strict bidder eligibility (S.29A), compressed timelines. Scheme: shareholder-and-creditor controlled with class votes, no eligibility filter, liabilities travel with the company (no clean slate), longer timelines, tax neutrality available. Sharpest contrasts: who votes, what liabilities survive, and speed versus consent.

FAQ​

Q1. What is the difference between the "appointed date" and the "effective date" of a merger? The appointed date is the date fixed in the scheme from which the transfer and vesting operate (often retrospective, e.g., the start of a financial year, for clean accounting). The effective date is when the certified NCLT order is filed with the RoC, making the scheme operative. Between board approval and the effective date, the transferor typically runs the business "in trust" for the transferee.

Q2. Do employees automatically move to the new company in a merger? Yes — Section 232(3) orders provide for transfer of employees, and schemes routinely guarantee continuity of service on terms no less favourable. Employees may be heard at the sanction stage (as in HLL Employees' Union), but they cannot veto a scheme; their protection lies in the continuity terms and industrial law.

Q3. Is a merged (amalgamated) company still liable for the transferor's old tax demands and lawsuits? Yes. Universal succession means pending proceedings continue against the transferee. Note, though, that assessments made in the name of a dissolved transferor after the merger raise validity questions — the Supreme Court in PCIT v. Maruti Suzuki India Ltd (2019) held an assessment on a non-existent amalgamating entity is void.

Q4. When does a deal need Competition Commission of India approval? When it is a "combination" crossing the asset/turnover thresholds in Section 5 of the Competition Act (updated periodically, with a de minimis target exemption) or, after the 2023 amendment, a deal value above ₹2,000 crore where the target has substantial business operations in India. Approval must come before closing; "gun-jumping" attracts penalties.

Q5. Can a merger be undone after the NCLT sanctions it? Practically almost never. The order can be appealed to the NCLAT (and the Supreme Court), and Section 232 orders can be modified for implementation difficulties, but once assets vest, shares are allotted and the transferor is dissolved, unscrambling is close to impossible — which is why regulators front-load their objections and courts insist on full disclosure at the sanction stage.

Quick Revision​

  • Merger/amalgamation = fusion; transferor dissolved without winding up; acquisition = purchase of control, target survives; demerger = hiving-off by the same scheme route.
  • Scheme route: Ss.230-232 — NCLT-convened class meetings; approval by majority in number + 3/4 in value (present and voting) per class.
  • Notice to regulators (RD, RoC, IT, RBI, SEBI, CCI, exchanges) — 30 days to object; objections need 10% shareholding or 5% of debt.
  • NCLT review is supervisory, not appellate — Miheer H. Mafatlal; expert-fixed swap ratios stand unless patently unfair — HLL Employees' Union.
  • Fast-track (S.233): small companies / holding-WOS; 90% members and creditors; RD registers, can refer to NCLT.
  • Cross-border mergers: S.234 + RBI approval + FEMA regulations (inbound and outbound to notified jurisdictions).
  • Squeeze-outs: S.235 (90% scheme approval → acquire dissenters); S.236 (90% holder ↔ minority buy-out at valuer's price).
  • Takeover Code (SAST 2011): 25% voting rights or control → mandatory open offer for ≥26%; creeping limit 5%/year; disclosures at 5% and 2% steps.
  • Competition Act: combinations over thresholds (incl. ₹2,000 crore deal-value test) need prior CCI approval; standstill until cleared.
  • IBC M&A: resolution plan — 66% CoC + NCLT sanction (S.31, binds all); S.29A bars wilful defaulters, NPA-linked persons and connected persons — ArcelorMittal; bar extends to liquidation schemes (Jagatramka).
  • Tax: court-approved amalgamations/demergers tax-neutral if IT Act conditions met (Ss.2(1B), 2(19AA), 47, 72A).
  • Assessment on a dissolved transferor is void — PCIT v. Maruti Suzuki (2019).

Prerequisites​

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