2021 (4) TMI 49 - Tri - Companies Law

Scheme of Amalgamation - seeking to dispense with the convening and holding of the meeting of Equity Shareholders of the Applicant Companies and Secured Creditors of the Applicant No. 2 and Unsecured Creditors of the Applicant No. 1 - seeking direction to convene the Meeting of Unsecured Creditors of the Applicant No. 2 - Sections 230 232 of the Companies Act, 2013 - HELD THAT - The Companies have followed extant provisions of Companies Act in framing the Scheme in question, which are duly approved by the Board of Directors of the Companies involved. The Statutory Auditors/Chartered Accountants of the Company have also issued respective Certificates by inter-alia certifying the details of shareholders, creditors, and compliance of accounting treatment as prescribed U/s. 133 of the Companies Act, 2013 with reference to the Scheme in question. The Applicant Companies have disclosed all the material facts relating to the Scheme in question and filed necessary documents along with the Application. The case, made out by the Applicants so as to grant relief as sought for, by dispensing with the meeting of the Equity Shareholders, Unsecured Creditors of the Applicant Company No. 1 and Secured Creditors of the Applicant company No. 2 and convene the meeting of the Equity Shareholders and Unsecured Creditors of the Applicant Company No. 2/Transferee Company by appointing the Chairperson and Scrutinizer for convening the meeting, fixing venue, time, quorum etc. is convincing. Various directions regarding holding and convening of various meetings issued - various directions regarding issuance of various notices issued - application alllowed.

Issues Involved:
1. Dispensation of meetings for Equity Shareholders and Creditors.
2. Approval of the Scheme of Amalgamation.
3. Compliance with statutory provisions and accounting standards.
4. Appointment of Chairperson and Scrutinizer for meetings.
5. Directions for convening meetings and subsequent actions.

Issue-Wise Detailed Analysis:

1. Dispensation of Meetings for Equity Shareholders and Creditors:
The Applicant Companies sought to dispense with the convening and holding of the meeting of Equity Shareholders of Applicant Company No. 1 and Secured Creditors of Applicant Company No. 2. The Tribunal was convinced by the affidavits and no-objection certificates provided by the shareholders and creditors, and thus, dispensed with these meetings.

2. Approval of the Scheme of Amalgamation:
The Scheme of Amalgamation involved the merger of WeP Digital Services Limited (Applicant Company No. 1) with WeP Solutions Limited (Applicant Company No. 2). The rationale for the Scheme included simplification of the group structure, greater efficiency in cash management, and maximization of shareholder value. The Tribunal noted that the Scheme was approved by the Board of Directors of both companies and certified by Chartered Accountants.

3. Compliance with Statutory Provisions and Accounting Standards:
The Tribunal reviewed the compliance with Sections 230 and 232 of the Companies Act, 2013, and the relevant rules. Certificates from Chartered Accountants confirmed that the accounting treatment specified in the Scheme complied with SEBI regulations and applicable Accounting Standards. The Tribunal found that the Applicant Companies had disclosed all material facts and complied with statutory requirements.

4. Appointment of Chairperson and Scrutinizer for Meetings:
The Tribunal appointed Mr. K.S. Vadivelu as Chairperson and Mr. Sriram Parthasarathy as Scrutinizer for the meetings of Equity Shareholders and Unsecured Creditors of Applicant Company No. 2. The remuneration for the Chairperson was fixed at ?75,000/- and for the Scrutinizer at ?40,000/-.

5. Directions for Convening Meetings and Subsequent Actions:
The Tribunal directed that the meeting of Equity Shareholders of Applicant Company No. 2 be held on 06.05.2021 at 11.00 a.m. and the meeting of Unsecured Creditors of Applicant Company No. 2 be held on the same day at 10.00 a.m. Notices of the meetings were to be published in "The Hindu" and "Udayavani." The Tribunal also directed the Chairperson and Scrutinizer to follow all extant provisions of the Companies Act, 2013, and to file their reports within two weeks of the meetings. The Applicant Companies were granted two weeks thereafter to file a Company petition seeking sanction of the Scheme.

Conclusion:
The Tribunal granted the relief sought by the Applicant Companies, dispensing with certain meetings and directing the convening of others, while ensuring compliance with statutory provisions and appointing officials to oversee the process. The Scheme of Amalgamation was deemed to be in the best interests of the companies and their stakeholders.

← Previous Next →