law: Companies Act, 2013 
  Chapter
  
  XV
  Compromises,
  
  Arrangements and Amalgamations
  230.
  
    Power
  
  to compromise or make arrangements with creditors and members.
  1.      Where a compromise or
  
  arrangement is proposed—
  a.     
  
    between
  
  a company and its creditors or any class of them; or
  b.    
  
    between
  
  a company and its members or any class of them, the Tribunal may, on the
  
  application of the company or of any creditor or member of the company, or in
  
  the case of a company which is being wound up, of the liquidator, order a
  
  meeting of the creditors or class of creditors, or of the members or class of
  
  members, as the case may be, to be called, held and conducted in such manner as
  
  the Tribunal directs.
  Explanation.— For the purposes of
  
  this sub-section, arrangement includes a reorganisation of the company’s share
  
  capital by the consolidation of shares of different classes or by the division
  
  of shares into shares of different classes, or by both of those methods.
  2.      The company or any
  
  other person, by whom an application is made under subsection (1 ), shall
  
  disclose to the Tribunal by affidavit—
  a.     
  
    all
  
  material facts relating to the company, such as the latest financial position
  
  of the company, the latest auditor’s report on the accounts of the company and
  
  the pendency of any investigation or proceedings against the company;
  b.    
  
    reduction
  
  of share capital of the company, if any, included in the compromise or
  
  arrangement;
  c.     
  
    any
  
  scheme of corporate debt restructuring consented to by not less than
  
  seventy-five per cent. of the secured creditors in value, including—
                       
  
   i.        
  
    a
  
  creditor’s responsibility statement in the prescribed form;
                      
  
   ii.        
  
    safeguards
  
  for the protection of other secured and unsecured creditors;
                     
  
   iii.        
  
    report
  
  by the auditor that the fund requirements of the company after the corporate
  
  debt restructuring as approved shall conform to the liquidity test based upon
  
  the estimates provided to them by the Board;
                     
  
   iv.        
  
    where
  
  the company proposes to adopt the corporate debt restructuring guidelines
  
  
  
  specified by the Reserve Bank of India, a statement to that effect; and
                      
  
   v.        
  
    a
  
  valuation report in respect of the shares and the property and all assets,
  
  tangible and intangible, movable and immovable, of the company by a registered
  
  valuer.
  1.     
  2.     
  3.      Where a meeting is
  
  proposed to be called in pursuance of an order of the Tribunal under
  
  sub-section (1 ), a notice of such meeting shall be sent to all the
  
  creditors or class of creditors and to all the members or class of members and
  
  the debenture-holders of the company, individually at the address registered
  
  with the company which shall be accompanied by a statement disclosing the
  
  details of the compromise or arrangement, a copy of the valuation report, if
  
  any, and explaining their effect on creditors, key managerial personnel,
  
  promoters and non-promoter members, and the debenture-holders and the effect of
  
  the compromise or arrangement on any material interests of the directors of the
  
  company or the debenture trustees, and such other matters as may be prescribed:
  
  
  Provided
  
  that such notice and other documents shall also be placed on the website of the
  
  company, if any, and in case of a listed company, these documents shall be sent
  
  to the Securities and Exchange Board and stock exchange where the securities of
  
  the companies are listed, for placing on their website and shall also be
  
  published in newspapers in such manner as may be prescribed:
  Provided
  
  further that where the notice for the meeting is also issued by way of an
  
  advertisement, it shall indicate the time within which copies of the compromise
  
  or arrangement shall be made available to the concerned persons free of charge
  
  from the registered office of the company.
  4.      A notice under
  
  sub-section (3 ) shall provide that the persons to whom the notice is
  
  sent may vote in the meeting either themselves or through proxies or by postal
  
  ballot to the adoption of the compromise or arrangement within one month from
  
  the date of receipt of such notice:
  Provided
  
  that any objection to the compromise or arrangement shall be made only by
  
  persons holding not less than ten per cent. of the shareholding or having
  
  outstanding debt amounting to not less than five per cent. of the total
  
  outstanding debt as per the latest audited financial statement.
  5.      A notice under
  
  sub-section (3 ) along with all the documents in such form as may be
  
  prescribed shall also be sent to the Central Government, the income-tax
  
  authorities, the Reserve Bank of India, the Securities and Exchange Board, the
  
  Registrar, the respective stock exchanges, the Official Liquidator, the
  
  Competition Commission of India established under sub-section (1 ) of
  
  section 7 of the Competition Act, 2002, if necessary, and such other sectoral
  
  regulators or authorities which are likely to be affected by the compromise or
  
  arrangement and shall require that representations, if any, to be made by them
  
  shall be made within a period of thirty days from the date of receipt of such
  
  notice, failing which, it shall be presumed that they have no representations
  
  to make on the proposals.
  6.      Where, at a meeting
  
  held in pursuance of sub-section (1 ), majority of persons representing
  
  three-fourths in value of the creditors, or class of creditors or members or
  
  class of members, as the case may be, voting in person or by proxy or by postal
  
  ballot, agree to any compromise or arrangement and if such compromise or
  
  arrangement is sanctioned by the Tribunal by an order, the same shall be
  
  binding on the company, all the creditors, or class of creditors or members or
  
  class of members, as the case may be, or, in case of a company being wound up,
  
  on the liquidator and the contributories of the company.
  7.      An order made by the
  
  Tribunal under sub-section (6 ) shall provide for all or any of the
  
  following matters, namely:—
  a.     
  
    where
  
  the compromise or arrangement provides for conversion of preference shares into
  
  equity shares, such preference shareholders shall be given an option to either
  
  obtain arrears of dividend in cash or accept equity shares equal to the value
  
  of the dividend payable;
  b.    
  
    the
  
  protection of any class of creditors;
  c.     
  
    if
  
  the compromise or arrangement results in the variation of the shareholders’
  
  rights, it shall be given effect to under the provisions of section 48;
  d.    
  
    if
  
  the compromise or arrangement is agreed to by the creditors under sub-section (6 ),
  
  any proceedings pending before the Board for Industrial and Financial
  
  Reconstruction established under section 4 of the Sick Industrial Companies
  
  (Special Provisions) Act, 1985 shall abate;
  e.     
  
    such
  
  other matters including exit offer to dissenting shareholders, if any, as are
  
  in the opinion of the Tribunal necessary to effectively implement the terms of
  
  the compromise or arrangement:
  Provided
  
  that no compromise or arrangement shall be sanctioned by the Tribunal unless a
  
  certificate by the company's auditor has been filed with the Tribunal to the
  
  effect that the accounting treatment, if any, proposed in the scheme of compromise
  
  or arrangement is in conformity with the accounting standards prescribed under
  
  section 133.
  1.     
  2.     
  3.     
  4.     
  5.     
  6.     
  7.     
  8.      The order of the
  
  Tribunal shall be filed with the Registrar by the company within a period of
  
  thirty days of the receipt of the order.
  9.      The Tribunal may
  
  dispense with calling of a meeting of creditor or class of creditors where such
  
  creditors or class of creditors, having at least ninety per cent. value, agree
  
  and confirm, by way of affidavit, to the scheme of compromise or arrangement.
  10.   No compromise or
  
  arrangement in respect of any buy-back of securities under this section shall
  
  be sanctioned by the Tribunal unless such buy-back is in accordance with the
  
  provisions of section 68.
  11.   Any compromise or
  
  arrangement may include takeover offer made in such manner as may be
  
  prescribed:
  Provided
  
  that in case of listed companies, takeover offer shall be as per the
  
  regulations framed by the Securities and Exchange Board.
  1.  
  2.  
  3.  
  4.  
  5.  
  6.  
  7.  
  8.  
  9.  
  10.  
  11.  
  12.   An aggrieved party
  
  may make an application to the Tribunal in the event of any grievances with
  
  respect to the takeover offer of companies other than listed companies in such
  
  manner as may be prescribed and the Tribunal may, on application, pass such
  
  order as it may deem fit.
  Explanation .—For the removal of
  
  doubts, it is hereby declared that the provisions of section 66 shall not apply
  
  to the reduction of share capital effected in pursuance of the order of the
  
  Tribunal under this section.