2016 (4) TMI 1263 - HC - Companies Law

Scheme of arrangement - dispensing with the meeting of the Equity Shareholders, Secured and Unsecured Creditors of the Applicant Transferee Company - Separate procedure under Sections100 to 103 of the Companies Act, 1956, is dispensed with. Publication of notice in the Official Gazette is ordered to be dispensed with.

Summary

Issues:
1. Dispensing with the meeting of Equity Shareholders, Secured and Unsecured Creditors for considering a Scheme of Arrangement.
2. Reduction of capital as part of the Scheme.

Detailed Analysis:
1. The judgment involves an application by a Transferee Company seeking orders to dispense with meetings of Equity Shareholders, Secured and Unsecured Creditors to consider a Scheme of Arrangement. The Applicant submitted that all Equity Shareholders have given consent, supported by consent letters and a Chartered Accountant's certificate verifying the list of Equity Shareholders. The Applicant further stated that there are no Secured Creditors, as confirmed by a Chartered Accountant's certificate. Additionally, it was argued that Unsecured Creditors' rights and interests would not be affected by the proposed Scheme, as the post-Scheme assets would exceed liabilities, ensuring full discharge of liabilities without any compromise or reduction in liabilities. The Court considered the submissions and issued orders accordingly.

2. The judgment also addressed the reduction of capital as an integral part of the Scheme. The Applicant contended that separate procedures under the Companies Act, 1956, should be dispensed with concerning the reduction of capital. The Court, after hearing the arguments, passed an order dispensing with the separate procedure under Sections 100 to 103 of the Companies Act, 1956, and also ordered the dispensation of the publication of notice in the Official Gazette. Ultimately, the Court allowed the application in the terms mentioned in the judgment.