2022 (9) TMI 642 - Tri - Companies Law

Sanction of Scheme of Amalgamation - Section 230 to 232 of the Companies Act, 2013 read with Companies (Compromises, Arrangements and Amalgamation) Rule, 2016 - HELD THAT - In view of Section 230(9) of the Companies Act, 2013, the Tribunal is empowered to dispense with calling of a meeting of creditors or class of creditors where such creditors or class of creditors, having at least ninety percent value, agree and confirm, by way of affidavit, to the scheme of compromise or arrangement. Application allowed.

Summary

Issues: Application under Sections 230 to 232 of the Companies Act, 2013 for Scheme of Amalgamation

Analysis:

1. Prayers for Orders: The Applicant Companies filed an application under Sections 230 to 232 of the Companies Act, 2013, seeking various orders related to the Scheme of Amalgamation. These orders included dispensing with the requirement of convening meetings of Equity Shareholders and Unsecured Creditors of both the Transferor and Transferee Companies, publication of citations, permission to file the Second motion application, and exemption from filing certain copies as per the National Company Law Tribunal Rules, 2016.

2. Affidavits and Representations: Affidavits were filed in support of the application by a representative authorized by Board Resolutions of the Applicant Companies. It was stated that no investigations or proceedings were pending against the companies, and no reduction of share capital or retrenchment of employees was planned. The business activities of the companies were also detailed.

3. Proposed Amalgamation: The proposed amalgamation was to be carried out under the provisions of Sections 230 to 232 of the Companies Act, 2013, with an appointed date set as 01.04.2022. Details regarding the Equity Shareholders, Unsecured Creditors, and consent affidavits from all members were provided for both the Transferor and Transferee Companies.

4. Company Details: The Transferor Company and Transferee Company were described in terms of their incorporation dates, authorized share capital, issued share capital, and board approvals for the Scheme of Amalgamation. Financial statements, auditors' certificates, and a valuation report were submitted in compliance with legal requirements.

5. Directions by the Tribunal: In accordance with Section 230(9) of the Companies Act, 2013, the Tribunal had the authority to dispense with the calling of meetings of creditors or classes of creditors if a certain percentage agreed to the scheme. The Tribunal directed dispensation of meetings for Shareholders, Secured Creditors, and Unsecured Creditors of both the Transferor and Transferee Companies based on the consent-affidavits provided.

6. Decision: The Tribunal allowed the application, and the Second motion joint application was permitted to be filed within the specified time frame as per the provisions of the Companies Act, 2013. Compliance with the orders and requirements set forth in the judgment was essential for further proceedings related to the Scheme of Amalgamation.