NCLT Sets Path For InCred Group Restructuring, Dispenses With Most Shareholder Meetings Under S.230 Companies Act - 2025-08-07

InCred Group's Major Corporate Restructuring Gets NCLT's Preliminary Nod

Mumbai, Maharashtra - The Mumbai Bench of the National Company Law Tribunal (NCLT) has issued key directives for a proposed composite scheme of arrangement involving four InCred Group companies, paving the way for a significant corporate restructuring. The bench, comprising Hon’ble Shri Ashish Kalia (Member, Judicial) and Hon’ble Shri Sanjiv Dutt (Member, Technical), approved the first motion application, outlining the procedural path forward for the complex merger and demerger plan.

The Tribunal largely dispensed with the requirement to convene meetings for most classes of shareholders and creditors, while ordering meetings for the equity shareholders and secured creditors of InCred Capital Financial Services Limited.

The Proposed Restructuring Plan

The application, filed under Sections 230 to 232 of the Companies Act, 2013, involves a multi-step composite scheme designed to streamline operations, consolidate regulated businesses, and enhance management focus. The key components of the plan, with an appointed date of April 1, 2025, are:

• Amalgamation of InCred Wealth: InCred Wealth Private Limited is set to merge into InCred Capital Financial Services Limited.
• Demerger: A specific business undertaking from InCred Capital Wealth Portfolio Managers Private Limited will be demerged and absorbed into InCred Capital Financial Services Limited.
• Amalgamation of InCred Research: InCred Research Services Private Limited will be amalgamated into InCred Capital Wealth Portfolio Managers Private Limited.

The stated rationale behind this intricate arrangement is to achieve greater operational efficiencies, cost savings through the elimination of duplicate processes, and a more focused management approach for different business verticals. The companies stated that the scheme "is in the interest of all the shareholders, creditors and other stakeholders... and is not prejudicial to the interests of the concerned shareholders, creditors or the public at large."

Arguments and Tribunal's Directions

The applicants, represented by Advocate Hemant Sethi, argued for dispensing with several statutory meetings, citing unanimous consent from various stakeholders and the nature of the scheme.

Shareholder and Creditor Meetings

The NCLT carefully considered the status of shareholders and creditors for each of the four applicant companies:

• Meetings Dispensed With: The Tribunal agreed to dispense with the meetings for the equity shareholders of InCred Wealth, InCred Capital Wealth Portfolio Managers, and InCred Research Services, as all respective shareholders had provided their consent via affidavits. Similarly, the meeting for preference shareholders of InCred Capital Financial Services was also dispensed with on grounds of unanimous consent.
• Meetings Ordered: For InCred Capital Financial Services Limited , which has 298 equity shareholders and 1,254 secured creditors, the Tribunal directed that physical meetings be convened within 60 days to seek their approval for the scheme.
• Unsecured Creditors: The Tribunal dispensed with the meetings of unsecured creditors for all four companies. It accepted the argument that the scheme does not compromise their rights, their liabilities would be discharged in the ordinary course of business, and the positive net worth of the transferee companies secures their interests. However, as a safeguard, the NCLT ordered the companies to notify all unsecured creditors, granting them 30 days to submit any representations to the Tribunal.

Key Excerpts from the Judgment

On the matter of dispensing with the unsecured creditors' meeting, the Tribunal noted:

"The Learned Counsel for the Applicant Companies submits that the Unsecured Creditors are not affected by the Scheme in any manner and there is no compromise or arrangement envisaged with them... The net worth of all Applicant Companies is positive... it does not affect the rights or interests of Unsecured Creditors. Further, there exists a catena of judicial precedents reiterating the settled principle of law that where a scheme does not involve any arrangement with creditors, their consent may be dispensed with."

The Tribunal appointed Shri. M.K Dubey as the Chairperson and Mr. Mitesh Shah as the Scrutinizer for the mandated meetings of InCred Capital Financial Services Limited.

Next Steps

The InCred Group companies are now required to serve notices to various regulatory authorities, including the Regional Director (MCA), Registrar of Companies, Income Tax Department, RBI, and SEBI, who will have 30 days to file any objections. Following the conclusion of the court-convened meetings and receipt of regulatory reports, the companies will file a second motion petition with the NCLT seeking final sanction for the composite scheme. The final order will determine the legal effectiveness of this major restructuring in India's financial services landscape.