The fast-track merger under Section 233 is administered by the Regional Director, and the ROC and the Official Liquidator are invited to raise objections to the scheme. The objections are not binding on the Regional Director, but they are considered, and a substantive objection can delay or derail the scheme.
The ROC’s Objections
The ROC may object on the grounds that the company has not filed its statutory returns, that the declaration of solvency is defective, that the scheme is not in compliance with the Companies Act, or that the company is under investigation. The ROC’s objection is typically directed at the procedural compliance, and it can be addressed by rectifying the default before the Regional Director’s hearing.
The Official Liquidator’s Objections
The Official Liquidator may object on the grounds that the scheme is prejudicial to the creditors, that the declaration of solvency is not supported by the company’s financial position, or that the scheme is a device to defeat the creditors’ claims. The OL’s objection is more substantive, and it requires a response that addresses the creditors’ interests.
The Response
The company’s response should address each objection specifically, attach the supporting documents, and demonstrate that the scheme is compliant. Where the objection reveals a genuine defect, the company should rectify it before the hearing. A general denial is not sufficient, and a failure to respond can result in the Regional Director rejecting the scheme.
A technically sound fast-track merger anticipates the objections and builds the record before the notices are issued. The declaration of solvency, the auditor’s certificate, and the ninety per cent consents are the foundation of the response.
Call to Action
Anuj Desai & Associates advises companies on the fast-track merger objections—from the ROC and OL notices and the grounds to the response and the Regional Director’s hearing. If your fast-track merger is facing objections, we can help you address them.
📧 office@anujdesaiassociates.com
📞 9619456656
🌐 https://anujdesaiassociates.com
🔗 linkedin.com/in/ca-anuj-desai-122547230
Article 230