Scheme of amalgamation meetings dispensed with where shareholder and creditor consents satisfied statutory requirements

Consent affidavits from all equity shareholders and relevant creditors, together with auditors' certificates supporting the scheme's accounting treatment, satisfied the statutory requirements for sanction proceedings under sections 230 to 232 of the Companies Act, 2013 and the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016. As the notice requirements to statutory authorities remained part of the scheme process and the proposed meetings would serve no useful purpose, the Tribunal dispensed with the meetings of the equity shareholders of all applicant companies.

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Issues: Whether the meetings of the equity shareholders, unsecured creditors and secured creditor could be dispensed with in proceedings for sanction of the scheme of amalgamation.

Analysis: The applicant companies produced consent affidavits of all equity shareholders and the relevant creditors, and the accounting treatment under the scheme was supported by the auditors' certificates. The Tribunal noted that the statutory requirements under sections 230 to 232 of the Companies Act, 2013 and the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 were satisfied, and that the notice requirements to the statutory authorities were to be complied with in terms of the scheme process. In these circumstances, the meetings sought to be convened served no useful purpose.

Conclusion: The meetings of the equity shareholders of all applicant companies were dispensed with, and the application was allowed.

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