Scheme of arrangement meetings dispensed with after consents and no-objection letters for shareholders and creditors were filed.

The Delhi High Court dispensed with convening meetings of the equity shareholders, secured creditors, unsecured creditors and, where applicable, preference shareholder for consideration of a composite scheme of arrangement, because the applicant companies had placed on record the necessary consents, no-objection letters and proof of repayment or consent for outstanding unsecured debt. The scheme had been approved by the respective boards, the registered offices were within the Court's jurisdiction, and the filings under the Companies Act, 1956 and applicable Rules were found to be in order. On that basis, the requirement to hold meetings was waived and the application was allowed.

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Issues: Whether the Court should dispense with the convening and holding of meetings of the equity shareholders, secured creditors, unsecured creditors and, where applicable, preference shareholders of the applicant companies for considering the proposed composite scheme of arrangement.

Analysis: The application was moved under Sections 391 to 394 of the Companies Act, 1956 read with Rules 67 to 87 of the Companies (Court) Rules, 1959 and the provisions of the Companies Act, 2013 to the extent applicable. The registered offices of all the applicant companies were within the territorial jurisdiction of the Court. The proposed scheme had been approved by the respective boards of directors. The Court found that the requisite consents and no-objection letters of all equity shareholders in each company, the sole or relevant secured creditors where applicable, and the unsecured creditors either by consent or upon proof of full repayment of outstanding debt, had been placed on record and found in order. In the case of the preference shareholder of Applicant Company-V, written consent was also filed and accepted.

Conclusion: The requirement of convening meetings of the equity shareholders, secured creditors, unsecured creditors and preference shareholder, wherever applicable, was dispensed with and the application was allowed.

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