Comments on Companies (Compromises, Arrangement & Amalgamation) Rules, 2016
By Team Legistify / 2016-04-26
The Central Government notified the Companies (Compromises Arrangements and Amalgamation) Rules, 2016 (“Companies Amalgamation Rules”). The Companies Amalgamation Rules came into force on December 15, 2016

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The Companies Amalgamation Rules prescribe various forms in which the documents may be filed with the National Company Law Tribunal (“ NCLT ”), Registrar of Companies (“ RoC ”) and other authorities for facilitating implementation of aforesaid provisions of the Act.

Authority before which application has to be made

As per the Companies Act 1956, The authority before whom an application has to be made is the “High Court” having jurisdiction in the State in which the registered office of the company is situated As per the new Act and draft the authority is the National Company Law Tribunal (Hereinafter referred to as Tribunal) to sanction all schemes of compromises or arrangements.

Notice of meeting

For the purpose of sub-section (4) of section 230 voting through postal ballot shall be made within thirty days from the date of the issue of the notice. As per the previous acts, persons to whom notice is sent may vote in the meeting either themselves or through proxies or by postal Ballot within one month from the date of receipt of the notice. The draft does not mention about voting through proxies which according to me will expedite the process of voting and remove discrepancies if any.  At the same time as per the new draft, voting can be done within 30 days from the date of issue of notice instead of receipt of notice which as per my opinion should be receipt of notice because the duration could be calculated appropriately once the notice is received, there might be chances that the notice is not received by the concerned person and could cause delay in voting.

The Central Government notified the Companies (Compromises Arrangements and Amalgamation) Rules, 2016 (“Companies Amalgamation Rules”). The Companies Amalgamation Rules came into force on December 15, 2016

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