Important—Court cannot act as a rubber stamp for approving scheme of arrangement.

1. These two Company Petitions are being disposed of by this common order as they relate to the scheme of arrangement agreed between the two companies, who are the petitioners in both the Company Petitions. The petitioner in Company Petition No. 200 of 2016 is Asmitha Microfin Limited (Asmitha) a public limited company incorporated on 26.02.2001. Its registered office is situated in Hyderabad, Telangana. The authorized share capital of the said company as on 01.04.2015 is Rs.400.00 crores divided into 3,50,00,000 equity shares of Rs.10/- each and 36,50,00,000 preference shares of Rs.10/- each. The issued, subscribed and paid-up share capital of the company is Rs.333,64,38,510/- divided into 2,43,82,786 fully paid-up equity shares of Rs.10/- each and 30,92,61,065 optionally convertible cumulative redeemable preference shares (OCCRPS) of Rs.10/- each. Similarly, the petitioner in Company Petition No. 201 of 2016, SHARE Microfin Limited (SHARE) was registered on 20.04.1999 as a public limited company and it is having its registered office in Hyderabad, Telangana. Its authorized share capital as on 01.04.2015 is Rs.830.00 crores divided into 10,00,00,000 equity shares of Rs.10/- each and 73,00,00,000 preference shares of Rs.10/- each. The issued, subscribed and paid-up share capital as on 01.04.2015 is Rs.697,35,20,420/- divided into 5,32,17,042 fully paid up equity shares of Rs.10/- each and 64,41,35,000 OCCRPS of Rs.10/- each. Both the companies are engaged in the business of providing financial and support services to marginalized sections of society particularly underserved rural and urban women across India. The erstwhile State of Andhra Pradesh passed Andhra Pradesh Micro Finance Institutions (Regulation of Money Lending) Act, 2010 regulating the loan disbursement and recovery process for micro finance institutions in Andhra Pradesh and Telangana. The provisions of the said Act reduced the revenue generation of the companies. The reduced revenues of both the companies have caused both of them to service their repayment obligations to their creditors out of the recoveries made by them from their business in States other than Andhra Pradesh and Telangana. The debt payment obligations coupled with limited fresh loans to the companies’ lenders created liquidity issues. The petitioners thought of segregating their respective businesses and consolidate in order to face the challenges. The Board of Directors of both the companies met on 31.03.2016 and approved the scheme of arrangement between the two companies to be operative from the appointed date subject to approval and direction of this Court. The petitioner in Company Petition No. 200 of 2016 filed Company Application No. 480 of 2016 for convening the meetings of equity shareholders, preference shareholders and creditors. This Court, by order dated 27.04.2016, appointed the Chairpersons to convene the meetings of the equity shareholders, preference shareholders and creditors of the petitioner company. Similarly, the petitioner in Company Petition No. 201 of 2016 filed Company Application No. 481 of 2016 for convening the meetings of equity shareholders, preference shareholders and creditors and this Court, by order dated 27.04.2016, appointed the Chairpersons to convene the meetings of the equity shareholders, preference shareholders and creditors of the petitioner company.

2. The meetings of the shareholders, preference shareholders and creditors of both the Companies were held as follows:-

S. No.	Meeting for	Meeting held on
1.	Shareholders of Asmitha Microfin Ltd.	30th May 2016
2.	Preference shareholders of Asmitha Microfin Ltd.	31st May 2016
3.	Creditors of Asmitha Microfin Ltd.	31st May 2016
4.	Shareholders of SHARE Microfin Ltd.	1st June 2016
5.	Preference shareholders of SHARE Microfin Ltd.	2nd Jun