Corporate Restructuring under the

Companies Act, 2013

1. The Central Government, vide notification

no. S.O. 3677(E) dated 7th December, 2016,
notified most of the provisions relating to the
corporate restructuring, merger, reduction of
capital and winding up, with effect from 15th
December, 2016. Section 230 to 240
[except section 230(11) & (12) and section
234] were notified with effect from 15th
December, 2016.

2. The Central Government, vide notification

no. G.S.R. 1119(E) dated 7th December,
2016, notified the Companies (Transfer of
Pending Proceedings) Rules, 2016. These
Rules provide for transfer of pending
cases/proceedings from the High Courts to
NCLT.

3. The aforesaid Rules shall come into force

with effect from 15th December, 2016,
except Rule 4 relating to Voluntary Winding
up which shall come into force with effect
from 1st April, 2017.


4. The Central Government, vide Order no. S.O.

3676(E) dated 7th December, 2016, notified
the Companies (Removal of Difficulties)
Fourth Order, 2016, with effect from 15th
December, 2016.

5. Through the aforesaid ROD Order, two

provisos were added to section 434(1)(c) of
the Companies Act, 2013, providing that
cases which are retained in the High Court
will continue to be governed under the
Companies Act, 1956.

6. The Companies (Compromises,

Arrangements and Amalgamations) Rules,
2016, were notified to come into force with
effect from 15th December, 2016.

7. The National Company Law Tribunal

(Procedure for Reduction of Share Capital of
Company) Rules, 2016, were notified to
come into force with effect from 15th
December, 2016.

8. The Central Government, vide notification

dated 26th December, 2016, notified sections
248 to 252 relating to removal of names of
companies from the Register of Companies,
with effect from 26th December, 2016.


9. The Companies (Removal of Names of

Companies from the Register of Companies)
Rules, 2016, were notified to come into force
with effect from 26th December, 2016. These
Rules only deal with removal of names and
does not deal with restoration of
name/revival of companies.


The Companies Act, 1956

Chapter 5: Arbitration, Compromises,

Arrangements and Reconstructions
Section Particulars
389 Power for companies to refer matters
to arbitration
Omitted by the Companies
(Amendment) Act, 1960
390 Interpretation of sections 391 and 393
391 Power to compromises or make
arrangements with creditors and
members
392 Power of High Court to enforce
compromise and arrangement
393 Information as to compromises and
arrangements with creditors and
members
394 Provisions for facilitating reconstruction
and amalgamation of companies
394A Notice to be given to Central
Government for applications under
sections 391 and 394
395 Power and duty to acquire shares of
shareholders dissenting from scheme
or contract approved by majority
396 Power of central government to
provide for amalgamation of
companies in national interest


396A Preservation of books and papers of

amalgamated company


The Companies Act, 2013

Chapter 15: Compromises, Arrangements

and Amalgamations
Section Particulars
230 Power to compromises or make
arrangements with creditors and
members
[Sub-sections (11) & (12) relating to
takeover offer not yet notified]
231 Power of Tribunal to enforce
Compromise or Arrangement
232 Merger and Amalgamation of
companies
233 Merger or Amalgamation of certain
companies
234 Merger or Amalgamation of company
with foreign company
[not yet notified]
235 Power to acquire shares of
shareholders dissenting from scheme
or contract approved by majority
236 Purchase of minority shareholding
237 Power of Central Government to
provide for amalgamation of
companies in public interest
238 Registration of offer of schemes
involving transfer of shares



239 Preservation of books and papers of

Amalgamated Companies
240 Liability of officers in respect of
offences committed prior to merger,
amalgamation, etc.


The Companies (Compromises,

Arrangements and Amalgamations) Rules,
2016

Rule Particulars
No.
1. Short title and commencement
[to come into force with effect from 15th
December, 2016]
2. Definitions
3. Application for order of a meeting
Application u/s 230(1) to be made in Form
NCLT-1
Notice of Admission in Form NCLT-2
Affidavit in Form NCLT-6
4. Disclosures in Application made to the Tribunal
for Compromise or Arrangement-Creditors
Responsibility Statement
Creditors Responsibility Statement to be
included in the Scheme of CDR
5. Directions at hearing of the Application
6. Notice of the meeting
In Form CAA-2
7. Advertisement of the Notice of the meeting
In Form CAA-2
8. Notice to Statutory Authorities
In Form CAA-3
Central Government, ROC and Income Tax
Authorities, in all cases;


RBI, SEBI, Stock Exchange and CCI, as

may be applicable
Other Sectoral Regulators or Authorities,
as required by Tribunal
9. Voting
Explanation (b) to Rule 9 which defines the
outstanding debts provides that the creditors
should will be as shown in the latest audited
financial statements and if such statements are
more than 6 months old, as per the provisional
financial statements not preceding the date
of Application by more than 6 months
10. Proxies
11. Copies of Compromise or Arrangement to be
furnished by the Company
12. Affidavit of Service
13. Result of the meeting to be decided by voting
14. Report of the result of the meeting by the
Chairperson
Report of Chairperson in Form CAA-4
15. Petition for confirming Compromise or
Arrangement
In Form CAA-5
16. Date and Notice of hearing
[Notice of the hearing to be advertised at least
10 days before the date of hearing]
[Meaning and implication of Rule 16(2) to be
discussed]



17. Order on Petition

[under section 230]
In Form CAA-2
18. Application for directions under section 232 of
the Act
19. Directions at hearing of the Application
[under section 232 of the Act]
20. Order under section 232 of the Act
In Form CAA-7
21. Statement of compliance in Mergers and
Amalgamations
In Form CAA-8
22. Report on working of Compromise or
Arrangement
23. Liberty to apply
24. Liberty of the Tribunal
Rules 24(2) empowers the NCLT to dispense
with any procedure prescribed under the Rules
25. Mergers and Amalgamations of certain
Companies
[under section 233]
Fast Track Mergers
26. Notice to dissenting Shareholders for acquiring
the shares
[under section 235(1)]
27. Determination of price for purchasing of
minority shareholding



28. Circular containing Scheme of Amalgamation or

Merger
[under section 238(1)(a)]
29. Appeal under section 238(2)


Index of Forms

Form Particulars
No.
CAA.1 Creditors Responsibility Statement
CAA.2 Notice of the meeting; and Advertisement
of the Notice of the meeting
CAA.3 Notice to Statutory Authorities
CAA.4 Report of the result of the meeting
Chairpersons Report
[within 3 days from conclusion of
meeting]
CAA.5 Petition for confirming Compromise or
Arrangement
[within 7 days of filing of the Report by the
Chairperson]
CAA.6 Order on Petition
[under section 230 of the Act]
CAA.7 Order under section 232 of the Act
CAA.8 Statement of compliance in Mergers and
Amalgamations
[In terms of section 232(7) within 210 days
from the end of FY, every year until the
Scheme is fully implemented]
CAA.9 Notice of the Scheme inviting objections
from ROC, OL and other interest persons
[under section 233(1)(a)]
CAA.10 Declaration of Solvency
[under section 233(1)(c)]


CAA.11 Report of the result of the meeting

[under section 233(2)]
Copy of the Scheme and Form No. CAA.11
to be filed with the ROC in e-form GNL-1;
Copy of the Scheme and Form No. CAA.11
to be filed with the OL by hand or through
registered post or speed post
CAA.12 Confirmation order to the Scheme of Merger
or Amalgamation to be issued by the
Central Government
[under section 233]
CAA.13 Application by the Central Government to
the Tribunal
[under section 233(5)]
CAA.14 Notice to dissenting Shareholders for
acquiring the shares
[under section 235(1)]
CAA.15 Circular containing Scheme of
Amalgamation or Merger
[under section 238(1)(a)]
Appeal under section 238(2) shall be in
Form NCLT-9 supported by an Affidavit in
Form NCLT-6