2021 (8) TMI 1195 - Tri - Companies Law

Sanction of scheme of Arrangement - seeking to dispense with the meetings of the Equity Shareholders, Secured and Unsecured Creditors of the Applicant Companies - Sections 230 to 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 Companies 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. Various directions with regard to holding, convening and dispensation with various meetings issued - directions with regard to issuance of various notices issued - the scheme is approved - application allowed.

Summary

Issues:
1. Application under Sections 230 to 232 of the Companies Act, 2013 seeking dispensation of meetings of Equity Shareholders, Secured, and Unsecured Creditors of the Applicant Companies.

Analysis:
The judgment by the National Company Law Tribunal, Bengaluru Bench, involved a case where two Applicant Companies, M/s. Austin Global Ventures Private Limited and M/s. Zerodha Broking Limited, filed an application seeking dispensation of meetings of Equity Shareholders, Secured, and Unsecured Creditors under Sections 230 to 232 of the Companies Act, 2013. The Tribunal carefully examined the application, relevant provisions of the Companies Act, 2013, and the submissions made by the learned counsel for the Applicant Companies.

The Applicant Companies provided detailed facts about their incorporation, shareholding structures, and approvals obtained for the proposed Scheme of Arrangement. The Chartered Accountants of the Applicant Companies issued certificates confirming the details of Equity Shareholders and absence of Secured Creditors in the companies. The Board of Directors had approved the Scheme, and the Statutory Auditors certified compliance with accounting standards. The rationale behind the Scheme included operational efficiency and optimal resource utilization for the benefit of shareholders, employees, creditors, and stakeholders.

After considering the submissions and documents presented, the Tribunal found that the Applicant Companies had followed the necessary legal procedures and provided all relevant information regarding the Scheme. Therefore, the Tribunal granted the relief sought by the Applicants and dispensed with the meetings of Equity Shareholders, Secured, and Unsecured Creditors of the Applicant Companies. The judgment directed the Applicant Companies to issue notifications about the dispensation of meetings in English and Vernacular languages and allowed parties to file miscellaneous applications if aggrieved by the decision. The Applicant Companies were also permitted to file a Company Petition for the sanction of the Scheme of Arrangement following the applicable laws.

In conclusion, the judgment of the Tribunal highlighted the importance of compliance with legal provisions, proper disclosure of material facts, and adherence to accounting standards in seeking relief under the Companies Act, 2013. The decision reflected a thorough review of the application and supporting documents to ensure the interests of all stakeholders involved in the proposed Scheme of Arrangement.