2016 (4) TMI 1256 - HC - Companies Law

Approval of Real Estate Demerger & Portfolio Transfer Scheme with Shareholder & Creditor Dispensation

The court approved the Composite Scheme of Arrangement involving the Demerger and Transfer of Real Estate and Portfolio Investment Undertakings, along ... Composite Scheme of Arrangement - Demerger and Amalgamation - Scheme of Arrangement under Companies Act - Dispensation of meetings of shareholders and creditors - Written consent of shareholders and unsecured creditors - Utilisation of Securities Premium AccountDispensation of meetings of shareholders and creditors - Written consent of shareholders and unsecured creditors - Composite Scheme of Arrangement - Dispensation from convening meetings of the Equity Shareholders and Unsecured Creditors of the applicant company granted. - HELD THAT: - The applicant filed a petition for sanction of a Composite Scheme of Arrangement involving demerger, transfer of undertakings, consequential capital restructuring and amalgamation. The application sought dispensation of meetings of Equity Shareholders and Unsecured Creditors of the applicant company on the ground that all such shareholders and unsecured creditors, as on date, had given their approval by written consent letters. The consent letters are annexed as Exhibits 'D' and 'E', and a certificate confirming the status of shareholders and creditors and receipt of those consents is annexed as Exhibit 'F'. It was also stated that there are no secured creditors. Having heard counsel and on the basis of the recorded unanimous written consents and the supporting certificates, the Court found it appropriate to permit the dispensation from holding the meetings and granted the relief sought. [Paras 4, 5]The prayers for dispensation of meetings of the Equity Shareholders and Unsecured Creditors of Stolon Fincon Services Private Limited are allowed and the application is disposed of.Final Conclusion: On the applicant's showing of written unanimous consents from all Equity Shareholders and Unsecured Creditors and the absence of secured creditors, the High Court permitted dispensation of the statutory meetings and disposed of the application accordingly. Issues:1. Composite Scheme of Arrangement involving Demerger and Transfer of Real Estate and Portfolio Investment Undertakings2. Dispensation of meetings of Equity Shareholders and Unsecured CreditorsAnalysis:1. The judgment pertains to a Composite Scheme of Arrangement involving the Demerger and Transfer of Real Estate and Portfolio Investment Undertakings, along with the consequential restructure of share capital. The scheme proposes the utilization of the Securities Premium Account of four Demerged companies and the amalgamation of residue undertakings with a Transferee Company. The legal provisions invoked include Sections 391 to 394, Sections 78 and 100 to 103 of the Companies Act, 1956, and Section 52 of the Companies Act, 2013.2. The application seeking dispensation of meetings of the Equity Shareholders and Unsecured Creditors is filed by a Transferor Company. The Applicant Company has obtained written consent letters from all Equity Shareholders and Unsecured Creditors, as evidenced by annexed exhibits. It is highlighted that there are no Secured Creditors involved in the scheme. The certificates confirming the status of Shareholders and Creditors, along with the consent letters, are collectively annexed. The court, after hearing the submissions made by the advocate for the applicant, grants dispensation from convening the meetings of Equity Shareholders and Unsecured Creditors based on the approvals received.3. The judgment concludes by disposing of the application in light of the facts presented and the dispensation granted for the meetings of Equity Shareholders and Unsecured Creditors. The order signifies the approval and acceptance of the proposed Composite Scheme of Arrangement as detailed in the application.