Rules 18 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Where a scheme involves the reconstruction or amalgamation of companies, rules 18 to 24 add a second layer: a separate application for directions under section 232, an order in Form CAA.7, a yearly statement of compliance in Form CAA.8 until the scheme is fully implemented, and the Tribunal's continuing power to ask for reports, hear applications and dispense with procedure. This article reads them as amended up to G.S.R. 603(E) dated 4 September 2025 per the MCA e-book; later amendments should be checked.
If the matters in a merger or reconstruction cannot be dealt with on the sanction petition, an application for directions under section 232 is made by notice of admission with an affidavit (rule 18). The order is in Form CAA.7 (rule 20). Every company under an order under section 232(3) files the CAA.8 statement with the Registrar within two hundred and ten days from the end of each financial year, until the scheme is fully implemented (rule 21). The Tribunal may call for a report on the working of the scheme (rule 22).
Rule 18: application for directions under section 232
Where a compromise or arrangement is proposed for a reconstruction of a company or companies or the amalgamation of two or more companies, and the matters involved cannot be dealt with, or dealt with adequately, on the petition for sanction, an application is made to the Tribunal under section 232 by a notice of admission supported by an affidavit, seeking directions on the proceedings to be taken. Under rule 18(2), notice of admission is given in the manner and to the persons the Tribunal directs. For help with the diligence and filings around a merger order, you can get in touch with our financial and legal due diligence team.
Rule 19: directions at the hearing
On hearing the notice of admission, or any adjourned hearing, the Tribunal may make such order or give such directions as it thinks fit on the proceedings for the reconstruction or amalgamation. These can include, where necessary, an inquiry into the creditors of the transferor company and the securing of the debts and claims of any dissenting creditors in the manner the Tribunal thinks just and appropriate. The detail of the Tribunal's powers under the section is in our note on section 232 of the Companies Act, 2013.
Rule 20: the order in CAA.7
An order under section 232 read with section 230 is in Form CAA.7, with such variation as the circumstances may require. Rule 20 says nothing more: the contents of the order come from the Tribunal's directions and the Act.
Rule 21: the statement of compliance in CAA.8
For section 232(7), every company in relation to which an order is made under section 232(3) must, until the scheme is fully implemented, file with the Registrar the statement in Form CAA.8, with the fee specified in the Companies (Registration Offices and Fees) Rules, 2014, within two hundred and ten days from the end of each financial year. The fee is not printed in this rule; it is explained in our series note on filing fees and additional fees under the Registration Offices and Fees Rules. Our format note on the statement to the Registrar after a scheme in CAA-8 shows how it is usually laid out. Tax consequences of a merger sit outside these rules: see our income-tax guides, and our comparison of merger and demerger under the Companies Act and the income-tax law.
Rule 22: report on working of the scheme
At any time after the order sanctioning the scheme, the Tribunal may, on its own motion or on the application of any interested person, direct the company, or its liquidator if the company is being wound up, to submit within the time the Tribunal fixes a report on the working of the scheme. On considering the report, the Tribunal may pass such orders or give such directions as it thinks fit.
Rule 23: liberty to apply
- Who (23(1)). The company, any creditor or member, or the liquidator of a company that is being wound up may at any time after the sanctioning order apply to the Tribunal to determine any question relating to the working of the scheme.
- First listing (23(2)). The application is first posted before the Tribunal for directions on notices and advertisement, if any.
- Orders (23(3)). The Tribunal may pass such orders and give such directions as it thinks fit, and may modify the scheme as it considers necessary for proper working, or pass such other orders as the circumstances require.
Rule 24: liberty of the Tribunal
Rule 24(1) lets the Tribunal, at any time during proceedings under these rules, order that a petition, application, evidence, information or statement be filed as an affidavit, in the manner it thinks fit. Rule 24(2) lets the Tribunal pass any direction or order, or dispense with any procedure prescribed by the rules, in pursuance of the object of the provisions for implementing the scheme of arrangement, compromise or restructuring, or otherwise as practicable, except on matters specifically provided in the Act.
Summary of the rules
| Rule | Subject | Form or period as printed |
|---|---|---|
| 18 | Application for directions under section 232 | Notice of admission with affidavit |
| 19 | Directions at hearing | Inquiry into creditors and securing dissenting creditors' debts, as the Tribunal thinks fit |
| 20 | Order under section 232 read with section 230 | Form CAA.7 |
| 21 | Statement of compliance | Form CAA.8, within two hundred and ten days from the end of each financial year |
| 22 | Report on working | Within the time fixed by the Tribunal |
| 23 | Liberty to apply | Any time after the order |
| 24 | Liberty of the Tribunal | Affidavits; dispensing with procedure |
Example
Sundar Engineering Limited is being merged into Meridian Steels Limited. The sanction petition cannot deal with the creditors of the transferor company adequately, so the companies apply under section 232 by notice of admission with an affidavit. The Tribunal directs an inquiry into creditors and orders security for one dissenting creditor's claim; the order follows in Form CAA.7. Each company then files CAA.8 within two hundred and ten days from the end of each financial year until the scheme is fully implemented. A year later a supplier applies under rule 23 on a question about how the scheme is working.
Need help with a merger order and its filings?
Mergers produce a chain of orders and statements, and the yearly CAA.8 filing continues until the scheme is fully implemented. Our team can help with diligence before the scheme and with the filings after it through financial and legal due diligence.
Key takeaways
- An application under section 232 is by notice of admission with an affidavit where the sanction petition cannot deal with the matters.
- The order is in Form CAA.7.
- CAA.8 is filed within two hundred and ten days from the end of each financial year until the scheme is fully implemented; the fee is under the Registration Offices and Fees Rules.
- The Tribunal may call for a report on the working of the scheme at any time after the order.
- The company, a creditor, a member or a liquidator may apply on questions about the working of the scheme.
Read next
- Rules 15–17: the CAA-5 petition, hearing and CAA-6 order
- Rule 25: fast-track merger
- Section 232: merger or amalgamation
- Statement to the Registrar after a scheme: CAA-8 format
Disclaimer: Based on the Companies Act, 2013 rules named above as consolidated in the MCA e-book (consulted on 3 October 2026), with the later notifications the article names. Later amendments, fees, forms and the Companies Act, 2013 provisions referred to should be checked. This article is general information, not legal advice; check the official text before acting.