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Section 230 and 232 of Companies Act 2103 read with rules Companies (Compromise, Arrangements and Amalgamation) Rules, 2016 




Call Board Meeting and approve following resolutions:

a. Approve the draft scheme of Merger.

b. Authorization to filing of application to NCLT

c. Authorization to file a Petition for confirmation of scheme by the NCLT.

d. Appointment of an Independent Registered Valuer for valuing shares to determine the share exchange ratio.


Company files preliminary petition and draft scheme of merger to NCLT:

Form NCLT-1 Application for order of meeting with fees,

Form NCLT-2 Notice of Admission

Form NCLT-6 attached with Affidavit disclosing:

a. latest financial position, latest auditors report, and pendency of any investigation or proceedings.

b. Reduction of share capital of the Company, if any.

c. Any scheme of corporate debt restructuring (CDR) if any

Joint-application application may be filed where there are more than one company


– NCLT fix Date, Time, and Place of Class Meeting and Appoint Chairpersons

 (In the class meeting, PASS SPECIAL RESOLUTION –majority by number and also hold ¾th by value):

– NCLT may directs as below:

  • Determining class of creditors or members whose meeting should be held.
  • Fixing the time and place of meetings.
  • Appointing a chairman & scrutinizer for the meeting.
  • Fixing the quorum.
  • Notice and the advertisement of such notice.
  • Time within to report to the NCLT, the result.

– Other matters NCLT may directs relating to Merger:

  • Transfer any or whole of the properties/undertakings etc.
  • Allotment or appropriation of shares or debentures etc. provided any shares hold in his own name shall be cancelled or extinguished.
  • Continuation of legal proceedings
  • Transfer of employees
  • Where transfer or company is dissolved, the fees, paid by it on authorized share capital shall be set off.
  • All incidental or supplementary matters.

Further no Compromise and arrangement shall be sanction by the NCLT unless Certificate by the company’s auditor is filled with NCLT for the accounting treatment effect.

(Note: NCLT may dispense with calling of a meeting of creditor or class of creditors where such creditors or their class, having at least 90 %value, agree and confirm, by way of affidavit to the scheme of demerger.)

Step: 6 Notice of such meeting shall be send to every member/creditor/Regulatory Authority Attaching following documents along with Form No. CAA.2: 

a. Copy of the scheme,

b. Details of the order of NCLT

c. Explanatory statement,

d. Date of the Board Meeting at which the scheme was approved along with voting results,

e. Copy of the valuation report, if any,

f. Explain effect of merger on Creditors, KMP, Directors, Promoters, Debenture-holder, Employees, etc.

g. Investigation or proceedings, if any, pending against the Company

Step: 7 Reporting by Chairman

  • Chairman file an affidavit not less than 7 days from the meeting to the NCLT
  • Advertise (Form CAA-2) in newspaper having wide circulation the Notice on Website of the company.
  • Within next 3 days of meeting file the result to NCLT for sanctioning the scheme

Step: 8 File the Petition to the NCLT for Confirming the Merger scheme:

The NCLT shall fix date for the hearing of the second petition, and notice of the hearing, not less than 10 days before the date fixed for the hearing.

Step: 9 NCLT may sanction the Scheme or not:

If sanction by NCLT: File to ROC copy of scheme

Copy of NCLT Order

E-form INC-28 (within 30 days)

After filling it shall become fully binding and effective.

 If not sanction by NCLT: File an appeal to NCLAT 

Every Company shall, until the completion of the scheme, file a statement in every year within 210 days from the end of each financial year with the ROC, certified by a CA or CS or CWA in practice indicating whether the scheme is being complied with in accordance with the orders of the NCLT or not by filling Form No.CAA.8.

Forms Involved: 

NCLT-1: Application to NCLT

NCLT-2: A notice of admission

NCLT-6:  Affidavit verifying Petition

CAA-2: Notice and advertisement to notice

CAA-3: Notice to Government Regulatory authorities

CAA-4: Result of report of meeting by chairperson

CAA-5: Petition to sanction Merger

CAA-6: Order of petition

CAA-8: Statement to be filled with ROC

INC-28: Notice of Order of the court

About the Author

ACS Divya Goel

Author is Divya Goel, ACS working as Assistant Manager- Company Secretary with Neeraj Bhagat & Co. Chartered Accountants, a Chartered Accountancy firm helping foreign companies in setting up business in India and complying with various tax laws applicable to foreign companies while establishing their business in India.


Author Bio

Neeraj Bhagat & Co. is helping foreign companies in opening up of Liaison/ Branch Office in India and complying with various tax laws applicable to foreign companies while establishing a business in India. Neeraj Bhagat is the founder of Neeraj Bhagat & Co. Chartered Accountants, a Chartered View Full Profile

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  1. Anusha G says:

    Dear sir
    If two companies are being amalgamated under which section do we have to report the creditors confirmation?
    Thanks in advance for your valuable services.

  2. shalini says:

    A company has been demerged and has resulted into 1 parent and 2 resultant companies. Share holders of Demerged Co. have been issued shares into resultant companies as per scheme of demerger. Reporting in Form FCGPR of shares allotted to Non Resident Shareholders in resultant companies has been done. The question is- 1. Whether Form FC-TRS needs to be filed by the Demerged Company to report reduction in no.of shares of Non Resident Shareholder? 2. How does the reduction in quantity and value of shares of Demerged Company get reported to ROC? Which Form? Form INC-28 was filed with ROC, but Company Master Data still shows old paid-up share capital of the company.

  3. Govindaraju Hanumantha rao says:

    good article and one can save time in dealing with mergers. i am involved in various types of audits of banks and companies as such i like this article. those who are interested to utilise my services in states of karnataka and AP/Telangana for any financial audit can contact me as i am ex banker and CA presently imparting trainings on BFSI and audits

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July 2024