Professional Documents
Culture Documents
Companies Act 1956
Companies Act 1956
SECTION 390 TO 396A AMALGAMATION MERGER DEMERGER EXTERNAL AND INTERNAL RECONSTRUCTION
If you can t beat you meet - Adolf Hitler
Marriage between two artificial persons is termed as Amalgamation. The procedure regarding it is mentioned in the above referred Section.
Section 391: Power to compromise or make arrangement with creditors and members.
Compromise and arrangement can be between company and its creditors or its members or any class of them. The persons who can apply to the court for the above mentioned purpose: - Application by the company itself, any of its creditors, member of the company, in case of the company which is being wound up by its liquidator. - To be called held and conducted in such manner as the court directs.
Sec 391(2)
If a majority in number, representing three-fourth in threevalue of the creditors/members, or class of creditors/members as case may be, present and voting either in person or by proxy, at the meeting, agree to any compromise or arrangement, the compromise or arrangement if sanctioned by the court be binding on all the creditors, members and also on the company or in the case of a company which is being wound up, on the liquidator and contributories of the company. An order made by the court under sub-section (2) shall subhave no effect until a certified copy of the order has been filed with ROC.
Sec. 394A- Notice to be given to 394ACG for application under sec 391 and 394.
The court shall give notice of every application made to it under section 391 or 394 to CG, and shall take into consideration the representations, if any, made to it by that Govt. before passing any order under any of these sections.
Section 396:
Power of CG to provide for the amalgamation of companies in national interest.
Section 395: Power and duty to acquire shares of shareholders dissenting from contract or scheme approved by majority.
Section 396 A
Preservation of books and papers of amalgamated company. Prior permission of CG is required, before disposing of the books and papers of the amalgamated company.