2010 (7) TMI 822 - HC - Companies Law

Winding up - meeting of the shareholders - Held that - In winding up applications, we ask the parties to serve a copy of the petition upon the company, thus dispensing with service by the court ; we dispense with drawing up and service of Writ Rules, and so on. Therefore, on a reading of section 391 with the aforesaid provisions the court has the power in appropriate cases to dispense with some formalities prescribed in the Rules. However, the court does not have the power to dispense with the mandate of the statute. The meeting cannot be dispensed with as it is a statutory requirement. A meeting has to be held, even if informal under section 391 for the purpose of adopting the scheme.

Issues:
1. Dispensing with the requirement of holding a meeting of equity shareholders under section 391.
2. Appointment of a special officer to hold a meeting of shareholders.
3. Convening and holding meetings of equity and preference shareholders for considering a proposed scheme of arrangement for amalgamation.
4. Advertisement requirements for convening the meetings.
5. Appointment of chairpersons for the shareholder meetings.
6. Quorum requirements for the shareholder meetings.
7. Voting by proxy and adjournment of meetings.
8. Determination of the value of each member for the meeting purposes.
9. Reporting the results of the meetings to the court.

Analysis:
1. The judgment addresses the issue of dispensing with the requirement of holding a meeting of equity shareholders under section 391. The court acknowledges its power to dispense with certain formalities but emphasizes that the mandate of the statute cannot be disregarded. A meeting must be held, even if informally, for the purpose of adopting the scheme.

2. A special officer, Mr. Subimal Mukherjee, is appointed to hold a meeting of the shareholders of the company to ascertain their consent to the scheme. This appointment is made in the interests of justice, to avoid unnecessary costs, delay, and hardship.

3. Meetings of equity and preference shareholders are to be convened and held to consider and approve, with or without modification, the proposed scheme of arrangement for amalgamation between the applicant-companies and their respective shareholders. Specific details regarding the date, time, and location of the meetings are provided.

4. Advertisement requirements for convening the meetings are outlined, including the insertion of advertisements in specified newspapers and the distribution of relevant documents to the shareholders.

5. Chairpersons are appointed for the shareholder meetings, with specific instructions regarding their roles, responsibilities, and remuneration.

6. Quorum requirements for the shareholder meetings are set at two persons each, present either in person or by proxy.

7. Provisions for voting by proxy, adjournment of meetings if necessary, and the submission of reports to the court regarding the meeting results are detailed.

8. The determination of the value of each member for the purpose of the meeting is specified, with instructions for dispute resolution.

9. The judgment concludes by directing all parties concerned to act on the signed copy of the order and provides for the disposal of the case.

This detailed analysis of the judgment provides a comprehensive overview of the issues addressed and the specific directives given by the court regarding each issue.

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