2021 (8) TMI 1110 - Tri - Companies Law

Sanction of scheme of amalgamation - Seeking holding, convening and dispensation with various meetings - Sections 230 to 232 of the Companies Act, 2013 - HELD THAT - Various directions regarding holding, convening and dispensation with various meetings issued - directions regarding issuance of various notices issued. The scheme is approved - application allowed.

Summary

Issues Involved:
1. Dispensation of meetings of Equity Shareholders, Preference Shareholders, Secured Creditors, and Unsecured Creditors.
2. Compliance with the Companies Act, 2013 and Indian Accounting Standards.
3. Approval and rationale for the Scheme of Amalgamation and Arrangement.
4. Pending investigations or proceedings against the Applicant Companies.

Issue-wise Detailed Analysis:

1. Dispensation of Meetings:
The Applicant Companies sought to dispense with the meetings of Equity Shareholders, 9.5% Redeemable, Non-Cumulative, Non-Convertible Preference Shareholder, Secured Creditors, and Unsecured Creditors. The Tribunal noted that affidavits of no objection were filed by the respective shareholders and creditors. The Chartered Accountants issued certificates confirming the details of shareholders and creditors, and their consents were duly recorded. Consequently, the Tribunal dispensed with the requirement to convene these meetings.

2. Compliance with the Companies Act, 2013 and Indian Accounting Standards:
The Tribunal observed that the Scheme was framed in compliance with the extant provisions of the Companies Act, 2013, and the applicable Indian Accounting Standards. The Statutory Auditors certified that the accounting treatment in the Scheme complied with Section 133 of the Companies Act, 2013, and the Companies (Indian Accounting Standard) Rules, 2015. The Applicant Companies disclosed all material facts and filed the necessary documents, ensuring transparency and adherence to legal requirements.

3. Approval and Rationale for the Scheme of Amalgamation and Arrangement:
The Board of Directors of the Applicant Companies approved the Scheme in their respective meetings held on December 16, 2020. The rationale for the Scheme included creating economies in administrative and managerial costs by consolidating operations, reducing duplication of responsibilities, and minimizing legal and regulatory compliances. The Tribunal was convinced that the Scheme was in the best interests of the Applicant Companies and their respective shareholders and creditors.

4. Pending Investigations or Proceedings:
The Tribunal noted that there were no investigations or proceedings pending against the Applicant Companies under Sections 210 to 225 of the Companies Act, 2013. This ensured that the Scheme was not under any legal scrutiny or challenge, facilitating a smoother approval process.

Conclusion:
The Tribunal, after careful consideration of the pleadings and the provisions of the Companies Act, 2013, granted the relief sought by the Applicant Companies. The meetings of the Equity Shareholders, Preference Shareholder, Secured Creditors, and Unsecured Creditors were dispensed with. The Applicant Companies were directed to issue paper notifications in specified newspapers about the dispensation of the meetings within ten days. Any aggrieved party was entitled to file a miscellaneous application for appropriate directions. The Applicant Companies were permitted to file the necessary Company Petition for the sanction of the Composite Scheme of Amalgamation and Arrangement after complying with the extant provisions of law.