MCA vide circular dated 21st August, 2019 issued clarification with regard to scheme of amalgamation which are mentioned below:
- Appointed date may be a specific calendar date or may be tied to the occurrence of an event such as grant of license by a competent authority; fulfillment of any preconditions agreed upon by the parties or meeting any other requirement as agreed upon between the parties.
- The ‘appointed date’ shall be deemed to be the ‘acquisition date’ and date of transfer of control for the purpose of conforming to accounting standards.
- where the ‘appointed date’ is chosen as a specific calendar date, it may precede the date of filing of the application for scheme of merger/amalgamation in NCLT. However, if the ‘appointed date’ is significantly ante-dated beyond a year from the date of filing, justification has to be given for the same.
- Appointed date may be based on the occurrence of a trigger event which is key to the proposed scheme and agreed upon by the parties. If such event based date being a date subsequent to the date of filing the order with the ROC, the company shall file an intimation of the same within 30 days of such scheme coming into force.
The complete content of circular is attached herewith: