2021 (1) TMI 451 - Tri - Companies Law

Seeking modifications of the order passed in the captioned Company Scheme Applications - holding of meeting of its members by way of video-conferencing and/ or other audio-visual means - HELD THAT - That in view of the current extra-ordinary circumstances due to the COVID-19 pandemic prevailing in the country the meeting of the equity shareholders of Applicant Company 1 be convened on 24.02.2021 or 26.02.2021 or 01.03.2021 at 3 PM or any adjourned dates thereof for the purpose of considering and if thought fit approving the proposed Scheme of Arrangement (Scheme) through video conferencing and/ or other audio visual means without holding a general meeting requiring the physical presence of shareholders at a common venue as the same in the current COVID-19 environment mandating social distancing norms shall not be feasible. That in view of the current extra-ordinary circumstances due to the COVID-19 pandemic prevailing in the country the meeting of the equity shareholders of Applicant Company 3 be convened on 24.02.2021 or 26.02.2021 or 01.03.2021 at 11AM or any adjourned dates thereof for the purpose of considering and if thought fit approving the proposed Scheme of Arrangement (Scheme) through video conferencing and/ or other audio visual means without holding a general meeting requiring the physical presence of shareholders at a common venue as the same in the current COVID-19 environment mandating social distancing norms shall not be feasible.

Summary

Issues Involved:
1. Modification of the order dated 20.02.2020.
2. Convening of shareholders' meetings through video conferencing due to COVID-19.
3. Change in the appointed date.
4. Issuance of notices to creditors and debenture holders.

Detailed Analysis:

1. Modification of the Order Dated 20.02.2020:
The Applicant Companies sought modifications to the order dated 20.02.2020, which directed the convening of physical meetings of equity shareholders. Due to the COVID-19 pandemic, holding such meetings became infeasible. The Tribunal was requested to allow meetings through video conferencing and other audio-visual means.

2. Convening of Shareholders' Meetings Through Video Conferencing:
The Tribunal initially directed the Applicant Companies to hold physical meetings on 31.03.2020 and 23.03.2020. However, due to the COVID-19 pandemic, the Applicant Companies requested to hold meetings via video conferencing. The Tribunal, considering the extraordinary circumstances, allowed the meetings to be convened on 24.02.2021, 26.02.2021, or 01.03.2021 through video conferencing. The Tribunal directed compliance with the guidelines issued by the MCA, including the use of the NSDL platform for virtual meetings and ensuring the meetings are recorded and preserved.

3. Change in the Appointed Date:
The Applicant Companies initially sought to amend the appointed date from April 1, 2019, to April 1, 2020. However, they later withdrew this request, and the original appointed date of April 1, 2019, was retained.

4. Issuance of Notices to Creditors and Debenture Holders:
The Tribunal directed the Applicant Companies to issue notices to secured and unsecured creditors having outstanding amounts of Rs. 10,00,000 and above as of 30.09.2020. Notices were to be sent by courier, registered post, speed post, hand delivery, or email. The Tribunal also mandated that notices be placed on the companies' websites and sent to SEBI and stock exchanges for further dissemination.

Additional Directions:
- The Tribunal emphasized that the meetings conducted via video conferencing should be recorded, and the unedited footage preserved.
- Notices of meetings, postal ballots, and other communications should be sent electronically, with provisions for shareholders, creditors, and debenture holders to register their email addresses if not already available.
- The Applicant Companies were directed to file proof of compliance with these directions within ten days of completing the required actions.

Conclusion:
The Tribunal allowed the modifications requested by the Applicant Companies due to the COVID-19 pandemic, permitting virtual meetings and ensuring compliance with regulatory guidelines. The original appointed date was retained, and specific directions were issued for the issuance of notices to creditors and debenture holders. The miscellaneous applications were disposed of accordingly.