Fast Track Merger Procedure – Section 233 – Companies Act, 2013

Megha Sharma 19 May 2022 11,046 Views 0 comment Print Company Law | Articles

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PROCESS NOTE OF FAST TRACK MERGER u/s 233 OF COMPANIES ACT, 2013
STEPS	PROCEDURE	DOCUMENTS REQUIRED	TIMELINES	FORMS
FIRST MOTION PROCEEDING
1	Take Declaration of Solvency + Statement of Asset & Liabilities	>DOS on Stamp Paper >Statement of A&L from Auditor	–	–
2	Draft Scheme
3	Board Meeting (1st)
	Convene a Board Meeting and pass the following resolutions:		–	–
	a) Approval of the scheme;	>Draft BR for approval of scheme >Draft BR for approving Assets and Lia. And Declaration of solvency along with Auditors Certificate
	b) Approval of Assets and Liabilities and declaration of solvency
4	Notice of the proposed scheme
	The notice of the proposed scheme inviting objections or suggestions, if any, shall be sent to the Registrar of Companies (“ROC”), Official Liquidators and Income Tax Department where registered office of the respective companies are situated or persons affected by the scheme along with a copy of the Scheme.	Take the delievery receipts + also send the notice through mail	After holding the Board meeting	CAA.9 (Format prescribed) + Form GNL-1
			After holding the Board meeting	CAA.9 (Format prescribed) + Form GNL-1
5	Filing a declaration of solvency with the ROC
	Each of the companies involved merger files a declaration of solvency, in the prescribed form, with the ROC where the registered office of the company is situated, before convening the meeting of members and creditors for approval of the scheme.	>BR >CAA-10(should be on stamp paper) >Proposed Scheme		CAA.10 (Format attached) in Form GNL-2

SECOND MOTION PROCEEDING
6	Board Meeting (2nd)
	Convene a Board Meeting and pass the following resolutions:		must be held after 35 days of sending notice to ROC, OL, IT (i.e. 35 days from step 4)
	a) Approval of the scheme after taking into consideration of any suggestions and objections	>BR for approval of Notice of EGM >BR for aprroval of Proposed Scheme
	b) Fixing date, time and place for convening of shareholders meeting;
7	Convening a meeting of members
	The notice of the meeting sent to the members shall be accompanied by –		Clear 21 days before the date of the meeting or shorter notice	MGT-14 (u/s 117)
	a) a statement, disclosing the details of the compromise or arrangement, as far as applicable, as referred to in sub-section 230 (3) of the Act read with sub-rule (3) of rule 6 of the Rules.	>SR >Explanatory Statement >Approved Scheme >Take note of NOC from authorities
	b) the declaration of solvency made in Form No. CAA.10;
	c) a copy of the scheme.

	The objections and suggestions received by the ROC, Official Liquidator and persons affected by the scheme are considered by the companies in their respective general meetings and the scheme is approved by the respective members or class of members at a general meeting holding at 90% of the total number of shares.
8	NOC from Creditors
	Meeting can be dispensed with by taking approval of majority representing nine-tenths in value of the creditors	>NOC from creditors along with Auditor’s Certificate (*NOC should be on stamp paper)`*
9	Filing of the Scheme
	a) File a copy of Scheme and report of the result of each of the meetings with the Regional Director.	>CAA.11 >BR-approval of scheme, EGM Notice >CAA.09 + Delievery receipts >GNL-1 for Noticing ROC & OL >CAA.10 along with Statement of A&L >GNL-2 for submission of CAA.10 >NOCs from authorities >EGM Notice >SR-approval of scheme >MGT-14 >Creditiors Approval >Approved Scheme	Within seven days from the conclusion of the meeting of members or creditors.	a) CAA.11 (Form attached) in Form RD-1 and GNL-2
	b) A copy of the scheme along with Form CAA. 11 shall also be filed with :			b) Hand delivery to OL

	· the ROC in Form GNL 1;

	· the Official Liquidator through hand delivery or by registered post or speed post.
10	Approval of the Scheme by the Regional Director
	1. On the receipt of the scheme, if the ROC or the Official Liquidator has no objections or suggestions to the scheme, the Regional Director shall register the same and issue a confirmation thereof to the companies.

	2. If the ROC or Official Liquidator has any objections or suggestions, he may communicate the same in writing to Regional Director within a period of thirty days. If no such communication is made, it shall be presumed that he has no objection to the scheme.

	3. If the Regional Director after receiving the objections or suggestions or for any reason is of the opinion that such a scheme is not in public interest or in the interest of the creditors, it may file an application before the Tribunal in Form No. CAA.13 within a period of sixty days of the receipt of the scheme under sub-section (2) stating its objections and requesting that the Tribunal may consider the scheme under section 232.

	4. On receipt of an application from the Regional Director or from any person, if the Tribunal, for reasons to be recorded in writing, is of the opinion that the scheme should be considered as per the procedure laid down in section 232, the Tribunal may direct accordingly or it may confirm the scheme by passing such order as it deems fit.

	5. If the Regional Director does not have any objection to the scheme or it does not file any application under this section before the Tribunal, it shall be deemed that it has no objection to the scheme.

	6. Where no objection or suggestion is received to the scheme from the ROC and Official Liquidator or where the objection or suggestion of ROC and Official Liquidator is deemed to be not sustainable and the Regional Director is of the opinion that the scheme is in the public interest or in the interest of creditors, the Regional Director shall issue a confirmation order of such scheme of merger or amalgamation in Form No. CAA. 12.
11	Filing of confirmation order with the ROC
	A copy of the order confirming the scheme by the Tribunal or Regional Director shall be communicated to the ROC having jurisdiction over the transferee company and the persons concerned and the ROC shall register the scheme and issue a confirmation to the companies and such confirmation shall be communicated to the ROC where transferor company or companies were situated.	>RD order >Approved Scheme	Within 30 days of the receipt of the order of confirmation of the scheme.	Form INC-28