2021 (11) TMI 845 - Tri - Companies Law

Sanction of Composite Scheme of Arrangement - Section 230-232 read with Section 66 of the Companies Act, 2013 and read with of the Companies (Compromise, Arrangement, and Amalgamations) Rules, 2016 - HELD THAT - Various directions with regard to holding, convening and dispensing with various meetings issued - directions regarding issuance of various notices also issued. The scheme is approved - application allowed.

Summary

Issues Involved:
1. Approval of the Composite Scheme of Arrangement under Sections 230-232 read with Section 66 of the Companies Act, 2013.
2. Dispensation of meetings for equity shareholders, secured creditors, and unsecured creditors.
3. Compliance with statutory requirements and procedural directions.

Detailed Analysis:

1. Approval of the Composite Scheme of Arrangement:
The joint application was filed under Sections 230-232 read with Section 66 of the Companies Act, 2013, and the Companies (Compromise, Arrangement, and Amalgamations) Rules, 2016. The scheme involved Mahavir Rolling Mills Private Limited (Transferor Company No. 1), MGI Industries Private Limited (Transferor Company No. 2), MGI Tradecom Private Limited (Transferee Company/Demerging Company), and Mahavir Biztrade Private Limited (Resulting Company). The scheme aimed to merge Transferor Companies No. 1 and No. 2 into the Transferee Company and subsequently demerge the metal manufacturing undertaking into the Resulting Company. The benefits cited included operational efficiency, streamlined business activities, and increased competitive strength.

2. Dispensation of Meetings:
The tribunal considered the consent affidavits from equity shareholders and creditors, and issued the following directions:

Transferor Company No. 1:
- Dispensed with the meeting of equity shareholders.
- Directed to convene meetings of secured creditors on 27/12/2021 at 10:30 am and unsecured creditors at 11:30 am.
- Quorum: 1 for secured creditors and 10 for unsecured creditors.

Transferor Company No. 2:
- Dispensed with the meeting of equity shareholders.
- Directed to convene the meeting of unsecured creditors on 27/12/2021 at 12:30 pm.
- No secured creditors, hence no meeting required.
- Quorum: 2 for unsecured creditors.

Demerged Company:
- Dispensed with the meeting of equity shareholders.
- No secured or unsecured creditors, hence no meetings required.

Resulting Company:
- Dispensed with the meeting of equity shareholders.
- No secured creditors, hence no meeting required.
- Dispensed with the meeting of unsecured creditors.

3. Compliance with Statutory Requirements and Procedural Directions:
The tribunal directed the following procedural steps to ensure compliance:

- Advertisement and Notice: At least one month before the meetings, publish an advertisement in "Business Standard" (English) and "Navgujarat Samay" (Gujarati) and send notices to all creditors by registered post, speed post, email, or courier.
- Chairman and Scrutinizer: Appointed Mr. Anuj Aggarwal as the Chairman and Mr. Harshil Lohia as the Scrutinizer for the meetings.
- Affidavit and Reporting: The Chairman to file an affidavit confirming compliance with notice and advertisement requirements and report the meeting results in Form No. CAA.4 within seven days.
- Notices to Authorities: Send notices in Form No. CAA.3 to the Central Government, Registrar of Companies, Income Tax authorities, and Official Liquidator, allowing 30 days for representations.

The application was allowed and disposed of in accordance with these directions.