NCLT does not approve Mallcom amalgamation scheme citing failure to meet shareholder approval threshold
The National Company Law Tribunal (NCLT) has ruled that the Scheme of Amalgamation between Mallcom (India) Limited and its subsidiary, Mallcom VSFT Gloves Private Limited, was not approved under Section 233(1)(b) of the Companies Act, 2013. The NCLT’s order, dated July 9, 2026, quashed proceedings related to the scheme that were pending before the Regional Director.The ruling specifically held that the requirement mandating approval by members holding at least ninety percent of the total number of shares had not been fulfilled. Mallcom (India) Limited received a certified copy of the NCLT order on August 12, 2026.
The Scheme involved the Transferee Company, Mallcom (India) Limited, and the Transferor Company, Mallcom VSFT Gloves Private Limited, which is a wholly-owned subsidiary of the transferee company. The companies had sought the NCLT’s consideration under Section 233(5) of the Companies Act, 2013.
The dispute centered on the interpretation of Section 233(1)(b). While the Respondent/Transferee Company argued that "total number of shares" should refer to the members present and voting at the general meeting, the Tribunal disagreed. The NCLT held that the phrase unequivocally referred to the total issued shareholding of the company.
A scrutiny report indicated that the Transferee Company had a total of 62,40,000 shares. During its Annual General Meeting (AGM) on August 30, 2025, the Scheme of Amalgamation received votes in favour from 51,28,714 members, which amounted to 99.98% of the total numbers of votes polled. However, when compared against the entire paid-up share capital, the vote in favour was 82.19%.
The Tribunal found that since approval under Section 233(1) required holding at least ninety percent of the total number of shares, the scheme could not be considered duly approved under this section. Consequently, and as per the NCLT’s finding, the question of considering the matter under Section 232 of the Companies Act, 2013, did not arise.
The Tribunal noted that while the company achieved near-perfect approval among members present and voting (99.98%), this still fell short of the required threshold when benchmarked against the total share capital, confirming that the scheme was not approved in compliance with Section 233(1).
Mallcom is currently evaluating its further course of action regarding the matter following this development.
MALLCOM Stock Price Movement
On Wednesday, shares of Mallcom (India) Limited shed 1.51%, settling at ₹981.35 after closing down ₹15.00 from the previous close. The equity recorded a traded volume of 1,292 shares during the session.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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