The challenge by the Ministry of Corporate Affairs (MCA) to the merger of two companies of Vedanta Resources – Sesa Goa Limited and Sterlite Industries Limited has been posted for final hearing by the Supreme Court..A Division Bench of Justice Anil R Dave and Justice Shiva Kirti Singh heard the matter yesterday..Senior Advocates Harish Salve and Arvind Datar appeared for Sesa Sterlite. Additional Solicitor General PS Patwalia appeared for the MCA while Solicitor General Ranjit Kumar represented the Income Tax Department (IT Department)..The MCA has challenged the merger of the two companies on the ground that it is a “colourable device” adopted to evade taxes. Sesa Goa and Sterlite Industries had merged to form Sesa Sterlite Limited following the Bombay High Court’s approval. Amarchand Mangaldas had acted as the sole legal advisor in this transaction..The merger was challenged before the Bombay High Court by one Shailesh H Bajaj. The High Court had, however, dismissed the same. Bajaj had, then, appealed to the Supreme Court against the High Court judgment which had also been dismissed..Subsequently, the IT Department had also moved the Supreme Court challenging the High Court’s refusal to allow it to intervene in the challenge before the High Court..Petitions of both IT Department and MCA are now being heard together..ASG Patwalia, appearing for MCA, submitted yesterday that the merger is a device to evade taxes and approval of the scheme will result in refund of Rs. 1500 crore paid earlier..Salve and Datar, however, argued that the shares of the company have been listed and are being traded for the last two years and that the amalgamation cannot be undone..They further contended that under 72A of Income Tax Act, if there is any merger or demerger, the company can take refund to set off the losses. They also submitted that the Supreme Court had dismissed the petition filed in 2013 by Shailesh H Bajaj challenging the merger..The Court after hearing the parties posted the matter for final hearing on April 28.
The challenge by the Ministry of Corporate Affairs (MCA) to the merger of two companies of Vedanta Resources – Sesa Goa Limited and Sterlite Industries Limited has been posted for final hearing by the Supreme Court..A Division Bench of Justice Anil R Dave and Justice Shiva Kirti Singh heard the matter yesterday..Senior Advocates Harish Salve and Arvind Datar appeared for Sesa Sterlite. Additional Solicitor General PS Patwalia appeared for the MCA while Solicitor General Ranjit Kumar represented the Income Tax Department (IT Department)..The MCA has challenged the merger of the two companies on the ground that it is a “colourable device” adopted to evade taxes. Sesa Goa and Sterlite Industries had merged to form Sesa Sterlite Limited following the Bombay High Court’s approval. Amarchand Mangaldas had acted as the sole legal advisor in this transaction..The merger was challenged before the Bombay High Court by one Shailesh H Bajaj. The High Court had, however, dismissed the same. Bajaj had, then, appealed to the Supreme Court against the High Court judgment which had also been dismissed..Subsequently, the IT Department had also moved the Supreme Court challenging the High Court’s refusal to allow it to intervene in the challenge before the High Court..Petitions of both IT Department and MCA are now being heard together..ASG Patwalia, appearing for MCA, submitted yesterday that the merger is a device to evade taxes and approval of the scheme will result in refund of Rs. 1500 crore paid earlier..Salve and Datar, however, argued that the shares of the company have been listed and are being traded for the last two years and that the amalgamation cannot be undone..They further contended that under 72A of Income Tax Act, if there is any merger or demerger, the company can take refund to set off the losses. They also submitted that the Supreme Court had dismissed the petition filed in 2013 by Shailesh H Bajaj challenging the merger..The Court after hearing the parties posted the matter for final hearing on April 28.