Ii approval of members and creditors approval to the

(ii) Approval of Shareholders/Creditors
Members' and creditors' approval to the scheme of amalgamation is sine qua non for
Court's sanction. Without that the Court cannot proceed. This approval is to be
obtained at specially convened meetings held as per court's directions [Section
391(1)]. However, the court may dispense with meetings of members/creditors.
Normally, creditors' meetings are dispensed with subject to certain conditions. For
instance, members' meeting may be dispensed with if all members' individual consent is
obtained.
(iii) Approval of Financial Institutions
The approval of the Financial Institutions, trustees to the debenture holders and banks,
investment corporations would be required if the Company has borrowed funds either as
term loans, working capital requirements and/or have issued debentures to the public and
have appointed any one of them as trustees to the debenture holders.
(iv) Approval from the Land Holders
If the land on which the factory is situated is the lease-hold land and the terms of the
lease deed so specifies, the approval from the lessor will be needed.
(v) Approval of the High Court
Both the companies (amalgamating as well as amalgamated) are required to seek
approval from the respective High Courts in accordance with the provisions of
Sections 391-394 of the Act, In this regard, the following points are worth noting:
An application under Sections 391 and 394 to High Court for an order convening a
meeting of members and/or creditors, is the first step to seeking Court's sanction to
amalgamation.
Every amalgamation, except those which involve sick industrial companies, requires
sanction of High Court ' which has jurisdiction over the State/area where the registered
office of a company is situated. [Section 391].
If transferor and transferee companies are under the jurisdiction of different High
Courts, separate approvals are necessary.
If both are under jurisdiction of one High Court, joint application may be made.

(Mohan Exports Ltd. v. Tarun Overseas P. Ltd. (1994) 14 CLA 279 (Del) dissenting from
Re Electro Carbonium P. Ltd.. (1979) 49 Comp Cas 825 (Kar) wherein it was held that a
joint application cannot be made.]
-Determination of Cut off Date
Amonst others, the foremost requirement is the determination of cut off date from
which all properties, movable as well as immovable and rights attached thereto etc. are
required to be transferred from amalgamating company to the amalgamated company.
The date may be called transfer date or appointed date and generally it is the first day of
preceding financial year for which the audited accounts are available with the company.
Another requirement is the determination of a date on which all the required approvals
under various statutes are obtained on which the transfer and vesting of the undertaking
of amalgamating company with the amalgamated company would take effect. It is
common to fix an appointed date as effective date in respect of scheme of amalgamation.