The single-member application sought dispensation from holding a shareholders' meeting to approve a scheme of arrangement. The court allowed the application, dispensing with the meeting as all seven shareholders had submitted no-objection affidavits.
The convening of a meeting of the shareholders of the applicant company is dispensed with.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
THE HON’BLE SRI JUSTICE C.V. NAGARJUNA REDDY COMPANY APPLICATION No.505 of 2014
ORDER:
This application is filed under Sections 391 and 394 of the Companies Act, 1956, read with Rule 69 of the Companies (Court) Rules, 1959, for dispensing with the convening of meeting of the shareholders of the applicant company for approving the proposed scheme of arrangement between it (resulting company-2) and M/s. Ananda Lakshmi Spinning Mills Limited (resulting company-1) and M/s. Suryavanshi Spinning Mills Limited (demerged company).
The applicant pleaded that it was incorporated on 26.08.2009, that its authorized share capital is Rs.5,00,00,000/- divided into 50,00,000 equity shares of Rs.10/- each and that its issued, subscribed and paid up capital is Rs.5,10,000/- divided into 51,000 equity shares of Rs.10/- each. That its main objects are to carry on the business of manufacturing, producing, processing, preparing, treating, packing, refining, buying, selling, importing, exporting, distributing, marketing and generally dealing in all kinds, descriptions and varieties of cotton, cotton silk, rayon, nylon, flax, hemp, jute, worsted and woolens, yarn, worsted stuffs, silk and artificial silks, hosiers, knitwear and wearing apparel of every kind, carpets, cloth, linen, fibrous substances, synthetic material, textile material, textile fabrics and the products thereof etc. That, for the reasons mentioned in paragraph 17 of the application, the applicant, resulting company-1 and demerged company seek to demerge undertaking-1 of the demerged company into resulting company-1 and undertaking-2 of the demerged company into the applicant. By the resolution of the Board of Directors of the applicant, dated 06.01.2014, the proposed scheme of arrangement was approved. The applicant further pleaded that it has seven shareholders, that they have given their consent for the proposed
scheme of arrangement by way of affidavits filed as annexure-A8 (Page Nos.274 to 281) and that it has no secured or unsecured creditors. It has, therefore, sought for dispensing with the holding of meeting of its shareholders.
Having regard to the fact that the seven shareholders of the applicant company have submitted their no objection/consent affidavits for the proposed scheme of arrangement, as evident from annexureA8, no purpose will be served by holding their meeting. Accordingly, holding of meeting of the shareholders of the applicant company is dispensed with.
The company application is accordingly allowed.
_________________________ C.V. NAGARJUNA REDDY, J
15th April, 2014 IBL
1 issue framed by the court
Whether a meeting of shareholders needs to be convened for approving a scheme of arrangement when all shareholders have provided consent affidavits.
3 provisions across 2 enactments
Applicant Company
C.V. Nagaryjna Reddy
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
