2020 (9) TMI 1000 - Tri - Companies Law

Tribunal Allows Virtual Meetings for Amalgamation Scheme Approval

The Tribunal granted dispensation for the meeting of equity shareholders and creditors for approving a Scheme of Amalgamation under sections 230 to 232 of ... Sanction of Amalgamation Scheme - dispensation of meeting of equity shareholders and creditors - sections 230 to 232 and other applicable provisions of the Companies Act, 2013 - HELD THAT:- This Bench hereby dispenses with the meetings of the Unsecured Creditors of each of the Applicant Companies. However, this Bench hereby directs that notices be issued to each Unsecured Creditor of each of the Applicant Companies with a direction that they may submit their objection, if any, to the Tribunal within thirty days of receipt of notice. Copies of such objections shall simultaneously be served upon the respective Applicant Company at its Registered Office. It shall be the duty of the Applicant Company concerned to ensure that every creditor of such company is put on notice as regards the Scheme. Further, any objection raised by any person shall be considered at the time of final disposal of the Company Petition. The Applicant Companies to serve the notice upon – (1) the Central Government through the office of the Regional Director (Western Region), Ministry of Corporate Affairs, Mumbai; (2) Registrar of Companies, Maharashtra, Mumbai; and (3) the Income Tax Authority within whose jurisdiction the Applicant Companies are assessed to tax, clearly indicating PAN of the company concerned; pursuant to section 230(5) of the Companies Act, 2013 and as perrule 8 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016. If no response is received by the Tribunal from such authorities within thirty days of the date of the receipt of the notice, it will be presumed that they have no objection to the proposed Scheme. The Applicant Companies shall file compliance report with the registry in regard to the directions given in this Order in lieu of customary affidavit of service, due to lockdown situation prevailing now proving service of notices to the regulatory authorities as stated above and do report to this Tribunal that the directions regarding the issue of notices have been duly complied with. Issues Involved:1. Dispensation of meeting of equity shareholders and creditors.2. Convening of meetings through video conferencing.3. Issuance and publication of notices for meetings.4. Appointment of Chairpersons and Scrutinisers for meetings.5. Reporting and compliance requirements.6. Dispensation of meetings for unsecured creditors.7. Service of notice to regulatory authorities.Issue-wise Detailed Analysis:1. Dispensation of Meeting of Equity Shareholders and Creditors:The joint application was filed under sections 230 to 232 of the Companies Act, 2013, seeking the dispensation of the meeting of equity shareholders and creditors for approving a Scheme of Amalgamation. The Tribunal noted that the Board of Directors of each Applicant Company had approved the Scheme in their respective meetings.2. Convening of Meetings Through Video Conferencing:The meetings of the equity shareholders of the Transferor Companies and the Transferee Company were scheduled to be convened through video conferencing or other audio-visual means on 03.09.2020. The meetings were to be conducted as per MCA General Circular No. 20/2020 due to the Covid-19 pandemic. Specific times were set for each company's meeting.3. Issuance and Publication of Notices for Meetings:At least thirty clear days before the meetings, notices convening the meetings, along with a copy of the Scheme, Explanatory Statement, and Form of Proxy, were to be sent to each equity shareholder by various modes including registered post and email. The Applicant Companies were also directed to publish the notice in 'Business Standard' (English) and 'Navshakti' (Marathi), both having wide circulation in Mumbai.4. Appointment of Chairpersons and Scrutinisers for Meetings:Mr. Pawan Khandelwal was appointed as the Chairperson for the meetings of equity shareholders of all the Transferor Companies and the Transferee Company, with Mr. Manish Khandelwal as the alternate Chairperson. Ms. Aditi Vohra, Practising Company Secretary, was appointed as the Scrutiniser for all meetings, with her remuneration fixed at Rs. 5,000 per meeting.5. Reporting and Compliance Requirements:The appointed Chairpersons were directed to file an affidavit at least seven days before the meetings, confirming compliance with the directions regarding the issue of notices, advertisement, and hosting on the company websites. They were also required to report the results of the meetings to the Tribunal within thirty days of the conclusion, verified by an affidavit.6. Dispensation of Meetings for Unsecured Creditors:The Tribunal dispensed with the meetings of the unsecured creditors of each Applicant Company, noting that there was no diminution of liability or sacrifice required from any creditor. However, notices were to be issued to each unsecured creditor, allowing them to submit objections to the Tribunal within thirty days of receipt. Any objections raised would be considered at the time of the final disposal of the Company Petition.7. Service of Notice to Regulatory Authorities:The Applicant Companies were directed to serve notices to the Central Government, Registrar of Companies, and the Income Tax Authority under section 230(5) of the Companies Act, 2013. Additionally, the Transferor Companies were to serve notice to the Official Liquidator, High Court, Bombay, with M/s H.K. Dedhia & Co, Chartered Accountants, appointed to assist on a consolidated remuneration of Rs. 30,000. If no objections were received within thirty days, it would be presumed that these authorities had no objection to the proposed Scheme.Additional Directives:The Applicant Companies were also instructed to publish the notice of filing of the Company Application on their respective websites and file a compliance report with the registry, proving service of notices to the regulatory authorities, due to the prevailing lockdown situation.