2021 (7) TMI 318 - Tri - Companies Law

Approval of scheme of Amalgamation - seeking directions for convening and holding of various meetings - Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 - HELD THAT - The meetings of the Secured Creditors of Applicant Company 1 is hereby dispensed with. Since there are NIL Secured Creditor in Applicant Company 2, question for convening of meeting of Secured Creditor in Applicant Company 2 does not arise. Application allowed.

Issues Involved:
1. Dispensation of the meeting of Secured Creditor of Applicant Company 1.
2. Directions for convening and holding meetings of Equity Shareholders and Unsecured Creditors of both Applicant Companies.
3. Declaration that the meeting of Secured Creditor of Applicant Company 2 is not required.
4. Compliance with Accounting Standards and regulatory approvals.
5. Appointment of Chairperson and Scrutinizer for the meetings.
6. Issuance of notices and advertisements for the meetings.
7. Reporting of meeting results to the Tribunal.

Detailed Analysis:

1. Dispensation of the Meeting of Secured Creditor of Applicant Company 1:
The Applicant Companies filed a joint application under Sections 230 to 232 of the Companies Act, 2013, seeking the dispensation of the meeting of the Secured Creditor of Applicant Company 1. It was stated that the sole Secured Creditor, with a debt value of ?127.34 Million, had given written consent for the Scheme of Arrangement and waived its right to convene the meeting. The Tribunal accepted the consent affidavit and dispensed with the meeting of the Secured Creditor of Applicant Company 1.

2. Directions for Convening and Holding Meetings of Equity Shareholders and Unsecured Creditors:
The Tribunal directed Applicant Company 1 to convene meetings of its Equity Shareholders and Unsecured Creditors on 31st July 2021 at specified times and venues. Similarly, Applicant Company 2 was directed to hold its meetings of Equity Shareholders and Unsecured Creditors on the same date at different times. Notices for these meetings were to be sent to all Equity Shareholders and Unsecured Creditors by various means, including registered post, speed post, courier, email, or hand delivery.

3. Declaration that the Meeting of Secured Creditor of Applicant Company 2 is Not Required:
The application stated that there were no Secured Creditors in Applicant Company 2. A certificate from M/s. VMRS & CO. Chartered Accountants confirmed this. Consequently, the Tribunal declared that the meeting of Secured Creditors of Applicant Company 2 was not required.

4. Compliance with Accounting Standards and Regulatory Approvals:
The Applicant Companies asserted that the accounting treatment specified in the Scheme of Arrangement conformed to the Accounting Standards prescribed by the Central Government. It was also reported that the Board of Directors of both companies had approved the Scheme through Board Resolutions. Additionally, no investigations or proceedings under the Companies Act were pending against the Applicant Companies. The companies had obtained no objections from relevant stock exchanges and depository participants.

5. Appointment of Chairperson and Scrutinizer for the Meetings:
Ms. Monica Choudhary was appointed as the Chairperson for the meetings of Equity Shareholders and Unsecured Creditors of both Applicant Companies, with Mr. Kalpesh Hariyan as the alternate. Mr. Narottam Bagaria was appointed as the Scrutinizer, with Mr. Narayan Parekh as the alternate.

6. Issuance of Notices and Advertisements for the Meetings:
The Tribunal ordered that at least one month before the meetings, advertisements about the meetings should be published in specified newspapers. Notices, along with copies of the Scheme of Arrangement and required statements, were to be sent to all Equity Shareholders and Unsecured Creditors. The publication and notices were to indicate that copies of the Scheme could be obtained free of charge from the registered offices of the Applicant Companies.

7. Reporting of Meeting Results to the Tribunal:
The Chairperson was directed to file an affidavit at least seven days before the meetings to confirm compliance with the issuance of notices and advertisements. The Chairperson was also required to report the results of the meetings to the Tribunal in Form CAA 4, verified by an affidavit, within 30 days of the meetings' conclusion.

Conclusion:
The Tribunal allowed the joint application with specific directions for convening and holding meetings of Equity Shareholders and Unsecured Creditors, dispensed with the meeting of the Secured Creditor of Applicant Company 1, and declared that no meeting was required for Secured Creditors of Applicant Company 2. The Tribunal also provided detailed instructions on the issuance of notices, advertisements, and reporting of the meetings' outcomes.

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