TaxTMI 
TaxTMI 
2019 (8) TMI 829
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....er referred to as the 'Act') arises out of declining of prayer seeking dispensation of meetings of Unsecured Creditors of Appellant No. 4 and Shareholders and Unsecured Creditors of Appellant No. 5 in terms of impugned order dated 7th June, 2019 passed by National Company Law Tribunal, Chandigarh Bench (hereinafter referred to as 'Tribunal'). It is urged that the proposed scheme of arrangement/ amalgamation is a scheme between wholly owned subsidiaries and their holding company. According to Appellants a first motion application was filed before the Tribunal seeking dispensation of meetings of Shareholders and creditors in view of the settled law on the subject followed by many benches of National Company Law Tribunal including ....
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....s. In that case both Applicant Companies had few shareholders all of whom had given their written consent and the Tribunal was of the view that there shall be positive net worth and the creditors were not compromised. Having regard for the same meeting of shareholders was dispensed with. (ii). In CA(29)(PB)2017 decided on 11th July, 2017 by NCLT Special Bench, New Delhi meeting of Unsecured Creditors was dispensed with as there was no Unsecured Creditor and the Transfer or Company was wholly owned subsidiary of the Transferee Company. 4. It is well settled that a Coordinate Bench is bound to follow the law enunciated by another Coordinate Bench and if it feels that the earlier view requires reconsideration....
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....ent law must be followed by all concerned; deviation from the same should be only on a procedure known to law. A subordinate court is bound by the enunciation of law made by the superior courts. A Coordinate Bench of a Court cannot pronounce judgment contrary to declaration of law made by another Bench. It can only refer it to a larger Bench if it disagrees with the earlier pronouncement. ....... " Hon'ble Apex Court in another case reported in (2005) 2 SCC 59, excerpts from para 16 whereof are reproduced, observed:- "..... These being judgments of coordinate benches were binding on the Tribunal. Judicial discipline required that the Tribunal follow those judgments. If the....
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....p; The Appellants prayed for dispensation of meetings of their respective Shareholders and Creditors of Appellants No. 1 to 5 as also in respect of warrant holders and CCD holders of Appellant No. 5. It was the further case of the Appellants that Shareholders of Appellant No. 1 to 4 had given written consent by way of affidavits. Same was the case with regard to Unsecured Creditors of Appellants No. 1 to 3 and Secured Debenture Holders, Warrant Holders and CCD Holders of Appellant No. 5. There were no Secured Creditors in Appellant No. 1 to 4. The Tribunal dispensed with these meetings to the extent of aforesaid stakeholders. However, the Tribunal, in terms of the impugned order declined to dispense with the me....
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....while relying on the judgments of larger Benches and Coordinate Benches of the Tribunal stated to have been brought to the notice of the Tribunal vide additional affidavit dated 15th February, 2019 vide Diary No. 787/19 as also the law propounded by various Hon'ble High Courts, submitted that in similar circumstances meetings of Shareholders and Creditors were dispensed with. We have referred to some of these judgments and the legal position enunciated therein would warrant the conclusion that the impugned order is per incuriam. It is noticed elsewhere in this judgment that following of the judicial precedent and observing the judicial view propounded by a Coordinate Bench in compliance is a matter of judicial discipline and the....
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....einabove declined the first motion to the extent it related to directions for convening of meetings of Unsecured Creditors of Appellant No. 4 and Equity Shareholders and Secured and Unsecured Creditors of Appellant No. 5. This is stated to have been done despite the settled legal position and view taken by the Coordinate Benches which were binding on the Tribunal. The first motion by the Appellants before the Tribunal sought dispensation in regard to calling of meeting of Members and Creditors, etc. This being the very threshold stage and not the Stage envisaged for consideration of the scheme for amalgamation by the Tribunal on merit, the Tribunal was required to exercise its discretion in accordance with the legal preced....