2015 (10) TMI 2681 - HC - Companies Law

Scheme of Amalgamation in the nature of merger - dispensation of meetings - Held that - The meetings of Secured Creditors and Unsecured Creditors of the applicant company shall be convened and held at the Registered Office of the Company, on 10.12.2015 at 11.00 a.m. and 12 00 noon respectively for the purpose of considering, and if thought fit, approving, with or without modifications, the Compromise or Arrangement proposed to be made between the said Companies. That at least 21 clear days before the day appointed for the meetings, an advertisement convening the same and stating that copies of the said arrangement and of the statement required to be furnished pursuant to Section 393 and forms of proxy can be obtained free of charge at the registered office of the company or at the office of their advocate, be inserted once in each dailies viz. Gujarati Daily Sandesh and English Daily Times of India , both Baroda Editions. That in addition, at least 21 clear days before the meetings to be held as aforesaid, a notice convening the said meetings at the place and time aforesaid, together with a copy of the said compromise or arrangement, a copy of the statement required to be sent under Section 393 and the prescribed form of proxy, shall be sent by prepaid letter post addressed to Secured Creditors and Unsecured Creditors at the registered or last known addresses. Voting by proxy to be permitted, provided that a proxy in the prescribed form duly signed by the person entitled to attend and vote at the meetings, is filed with the company at the above address not later than 48 hours before the meetings. That the value of debt of each of the secured and unsecured creditors shall be in accordance with the books of the company and, where the entries in the books are disputed, the Chairman shall determine the value for purposes of the meetings. And it is further ordered that the Chairman reports to this Court result of the said meetings within 21 days of the conclusion of the meetings, and the said reports shall be verified by his affidavit. The publication of the notice in the official gazette is ordered to be dispensed with. In view of the fact that the consent of all the equity shareholders are obtained and produced on record, the meeting of the equity shareholders is ordered to be dispensed with.

Summary

Issues:
Convening meetings of Secured Creditors and Unsecured Creditors for approving Scheme of Amalgamation and dispensation of Equity Shareholders' meeting.

Analysis:
The judgment involves the application by Centurion Remedies Private Limited seeking orders to convene meetings of Secured Creditors and Unsecured Creditors to approve the Scheme of Amalgamation for the merger with Centurion Laboratories Pvt. Ltd. The applicant requested dispensation of the Equity Shareholders' meeting, citing that consent from all equity shareholders has been obtained and recorded.

The Court, after hearing the applicant's submission and reviewing the relevant documents, ordered the meetings of Secured Creditors and Unsecured Creditors to be held at the Registered Office of the Company on a specified date. The advertisement for the meetings was required to be published in Gujarati Daily 'Sandesh' and English Daily 'Times of India' (Baroda Editions) at least 21 days prior to the meetings. Additionally, notices with relevant documents were to be sent to the Secured Creditors and Unsecured Creditors at their registered addresses.

The judgment appointed specific individuals to chair the meetings and oversee the necessary procedures. It specified the quorum for both types of creditors and allowed for voting by proxy, subject to the prescribed form being submitted within the stipulated time frame. The valuation of debts for each creditor was to be based on the company's books, with the Chairman authorized to determine values in case of disputes.

Furthermore, the Chairman was required to report the meeting outcomes to the Court within 21 days, with verification through an affidavit. The judgment waived the publication of notice in the official gazette and dispensed with the Equity Shareholders' meeting due to the prior consent obtained and documented. Finally, the application was disposed of, subject to the provided directions and observations.