2017 (6) TMI 409 - Tri - Companies Law

Directions to convene and hold meeting of equity shareholders of the applicant company for the purpose of considering and if thought fit, approving, with or without modification, a Scheme of Arrangement in the nature of Demerger need to be adhered to. Scheme of demerger accepted.

Summary

Issues:
Application under sections 230 to 232 of the Companies Act, 2013 for directions to convene and hold a meeting of equity shareholders to consider a Scheme of Arrangement involving the demerger of a Pharma Undertaking.

Analysis:
The applicant, a private limited company, sought approval for a Scheme of Arrangement involving the demerger of a Pharma Undertaking from a Demerged Company to the Resulting Company. The Board of Directors approved the proposed Scheme, conforming to accounting standards. No secured or unsecured creditors were reported by the applicant. The Tribunal ordered the applicant to convene and hold a meeting of equity shareholders to consider and approve the scheme. The meeting was scheduled for a specific date and time at the registered office of the company, with provisions for postal ballot and e-voting as per relevant sections and rules. Advertisements about the meeting were to be published, and notices were to be sent to equity shareholders in advance.

The Tribunal appointed a chairman and a scrutinizer for the meeting, with specific instructions regarding the conduct of the meeting, voting procedures, and quorum requirements. Proxy voting was permitted under specified conditions. The number and value of equity shareholders were to be determined by the Chairperson in case of disputes. The Chairperson was required to file an affidavit confirming compliance with meeting-related directions. Additionally, a report on the meeting's results was to be submitted to the Tribunal within a specified timeframe.

Further compliance requirements included sending notices to relevant authorities and allowing a period for objections or representations. The authorities were to respond within 30 days; otherwise, it would be presumed they had no objections. The Tribunal disposed of the Company Application accordingly, outlining the detailed procedures and compliance measures to be followed throughout the process.