2012 (12) TMI 835 - HC - Companies Law

Scheme of Amalgamation - Held that - No proceedings under sections 235 and 251 of the Companies Act, 1956 are pending against any of the Applicant Company as on date of the present Application & the scheme has been approved by the Board of Directors of the Applicant Companies. In view of the written consent / NOC given, the requirement of convening meetings of Shareholders, Unsecured Creditors of Applicant Company nos. 1, 3 & 4 & Five Secured Creditors, holding 99.99% of total debts of Secured of Applicant Company no. 5 / the Transferee Company is dispensed with. Direct the meeting of Un- Secured Creditors of Applicant Company no. 5 / Transferee Company on 09.02.2012 (Saturday) at 10.30 a.m & Unsecured Creditors of Applicant Company no. 2 / Transferor Company no. 2 shall be held on 09.02.2013 (Saturday) at 1.30 Noon at Sri Sathya Sai International Auditorium, Bheeshm Pitahmah Marg, Pragati Vihar, Near Nehru Stadium, New Delhi -110003 to be headed by appointed Chairperson and the Alternate Chairperson - direction to publish advance notice of aforesaid meetings in defined newspapers & Individual notices minimum 21 days in advance. If the quorum is not present in the meeting, the meeting would be adjourned for 30 minutes and the persons present in the meeting would be treated as proper quorum - Voting and proxy is permitted as filed with the companies at their registered offices, not later than 48 hours before the said meeting. The Chairmen / Alternate Chairmen shall file their reports within 2 weeks of the conclusion of the meeting.

Summary

Issues:
1. Application under section 391 & 394 of the Companies Act, 1956 for Scheme of Amalgamation.
2. Approval of the proposed Scheme by the Board of Directors.
3. Status of Shareholders, Secured and Unsecured Creditors, and consents obtained.
4. Dispensation of the requirement of convening meetings for Shareholders and Creditors.
5. Appointment of Chairpersons and secretarial assistance for creditor meetings.
6. Publication of advance notices of meetings and individual notices.
7. Fixing the quorum for Unsecured Creditors.
8. Voting and proxy provisions for the meetings.
9. Filing of reports by Chairmen/Alternate Chairmen after the meetings.

Analysis:

1. The judgment pertains to a joint application under sections 391 & 394 of the Companies Act, 1956, regarding the Scheme of Amalgamation of multiple companies. The application includes the proposed Scheme of Amalgamation and confirms that the registered offices of the companies are within the jurisdiction of the Delhi High Court.

2. It is noted that the proposed Scheme has been duly approved by the Board of Directors of the Applicant Companies, and copies of the Board Resolutions have been submitted along with the application. This indicates compliance with internal corporate governance requirements.

3. The judgment details the status of Shareholders, Secured and Unsecured Creditors of the companies involved in the Scheme, along with the consents obtained from them. The information is presented in a tabular format, providing transparency regarding the stakeholders' involvement in the process.

4. The Court grants dispensation of the requirement to convene meetings of Shareholders and Creditors based on the written consents and NOCs received, streamlining the procedural aspects of the amalgamation process.

5. Specific instructions are given for the appointment of Chairpersons and secretarial assistance for conducting separate meetings of Unsecured Creditors of the companies involved, ensuring proper facilitation and organization of the creditor gatherings.

6. Provisions are made for the publication of advance notices of meetings and individual notices, emphasizing the importance of transparency and communication in corporate actions of this nature.

7. The judgment fixes the quorum for Unsecured Creditors, outlining the minimum percentage required for a valid meeting and providing for adjournment procedures in case of quorum non-fulfillment.

8. Detailed provisions for voting and proxy mechanisms are established, ensuring that shareholders' rights are protected and enabling effective participation in the decision-making process related to the Scheme of Amalgamation.

9. Lastly, the judgment mandates the filing of reports by the appointed Chairpersons/Alternate Chairpersons within a specified timeframe after the conclusion of the meetings, ensuring accountability and documentation of proceedings for future reference.