2020 (9) TMI 848 - Tri - Companies Law

Sanction of scheme of merger by absorption - sections 230 to 232 and other applicable provisions of the Companies Act, 2013 - HELD THAT - Various meetings have been dispensed with - In compliance of sub-section (5) of section 230 of the Act and rule 8 of the Companies (CAA) Rules, the applicant-companies shall send a notice of meeting in Form No. CAA-3 with a copy of the scheme of arrangement, the explanatory statement and the disclosures mentioned under rule 6. Application disposed off.

Issues:
1. Application filed under sections 230 to 232 of the Companies Act, 2013 for merger by absorption.
2. Jurisdiction of the National Company Law Tribunal, Ahmedabad Bench.
3. Empowerment of companies to enter into a merger scheme.
4. Benefits of the proposed merger scheme.
5. Valuation report and scheme of merger submitted.
6. Confirmation of no pending proceedings or investigations.
7. Reliefs prayed by the applicant-companies.
8. Dispensation of meetings and approvals.
9. Detailed order by the Tribunal regarding meetings of stakeholders and creditors.
10. Compliance requirements under section 230 of the Act and Companies (CAA) Rules.

Analysis:

1. The judgment pertains to a joint application by two applicant-companies under sections 230 to 232 of the Companies Act, 2013, seeking approval for a merger by absorption. The scheme involves merging Seal for Life India P. Ltd. with PROJs Sealant India P. Ltd.

2. Both applicant-companies have their registered offices in Vadodara, Gujarat, falling under the jurisdiction of the National Company Law Tribunal, Ahmedabad Bench.

3. The companies are authorized by their memorandum of associations to enter into the merger scheme. Financial statements of the transferor company and provisional statements of both companies have been submitted.

4. The proposed merger aims at legal integration, resource consolidation, and operational efficiency, benefiting stakeholders. Board resolutions and benefits of the merger are detailed in the application.

5. A valuation report and merger scheme details have been provided, along with confirmation of no pending legal proceedings or investigations against the companies.

6. The application includes specific reliefs sought by the applicant-companies, such as dispensation of certain meetings and approvals from stakeholders.

7. The Tribunal, after hearing submissions, orders dispensation of equity shareholders and secured creditors meetings based on consent letters and confirmations provided.

8. Detailed provisions are made for convening a meeting of unsecured creditors of the transferor company, while dispensing with the sole unsecured creditor meeting of the transferee company.

9. The Tribunal issues specific directions for conducting the unsecured creditors meeting, including notice requirements, quorum, voting procedures, and appointment of officials for the meeting.

10. Compliance requirements under section 230 of the Act and Companies (CAA) Rules are outlined, including sending notices to relevant authorities and allowing representations within a specified period.

This judgment addresses various legal aspects of the merger application, ensuring compliance with statutory provisions and protecting the interests of stakeholders involved in the process.

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