- (1.) This is a Petition which is filed by the Petitioner above-named for the purpose of confirmation of reduction of its equity share capital. The Petition was originally filed in the Hon'ble High Court of Delhi under the erstwhile provisions of Companies Act, 1956 and the matter was listed before it on 07.12.2016. The Hon'ble High Court on the said date was pleased to direct that notice of the Petition be issued to the Registrar of Companies as well as Regional Director and also direct the Petitioner to carry out publication in the newspapers "Statesman" in English and "Veer Arjun" in Hindi both Delhi Edition. The proceedings as above pending before the Hon'ble High Court of Delhi in view of Section 66 of the Companies Act, 2013 having been notified by the Central Government vide Notification No. 3677E : MANU / DCAF/0147/2016 dated 07.12.2016 effective from 15.12.2016 as well as the Rules titled as "National Company Law Tribunal (Procedure for Reduction of Share Capital of Companies) Rules, 2016" having also been notified, the Hon'ble High Court vide its Order dated 15.02.2017 has transferred the instant Petition as well as transmitted the records connected therewith to this Tribunal which in view of all the above is now vested with the powers to consider matters concerning Reduction of Share Capital.
(2.) Subsequent to the transfer, the matter came up before us on 23.03.2017 for hearing and the Counsel for the Petitioner represented that the report of the Regional Director/Registrar of Companies has been filed as directed by the Hon'ble High Court. The Learned Counsel for the Petitioner took us through the Petition and represented that: (a) The paid up value of each Equity Share of the Company will be reduced from Rs. 10 per share to Rs. 2 per share and the total paid up Share Capital of the Company shall be reduced from Rs. 49,14,84,980/- divided into 4,91,48,498 Equity Shares of Rs. 10/- each, fully paid-up, to Rs. 9,82,96,996/- divided into 4,91,48,498 equity Shares of Rs. 2/- each, fully paid-up. The Reduction of Capital shall be on proportionate basis and all the pre-Scheme shareholders will remain as the shareholders of the Company even after the Scheme in the same proportion. (b) Upon the Scheme coming into effect, the entire accumulated losses of the company being the debit balance of profit and loss account to the tune of Rs. 37,32,77,301/- as per the audited balance sheet of the company as on 31.03.2017, will be written off against the aforesaid Reduction of Capital. (c) The difference between the amount of reduction in share capital and the amount of debit balance of profit and loss account written off shall be credited to the Capital Reserve Account. (d) Upon the Scheme coming into effect, all the equity shareholders holding equity shares of Rs. 10/- each will continue to hold the same number of equity shares. However, the face value and the paid-up value of each of the equity shares shall be reduced to Rs. 2/- per share. and that the rationale is stated in Paragraph 15 of the Petition as extracted below:- a. The present issued, subscribed and paid-up share capital of the Company is Rs. 49,14,84,980/- divided into 4,91,48,498 Equity Shares of Rs. 10/- each. As on 31st March, 2016, the Company has accumulated losses (debit balance of Profit & Loss Account) to the tune of Rs. 37,32,77,301/-. Capital of the Company has been lost to the extent. b. In order to re-align the relation between capital & assets; and to accurately and fairly reflect the liabilities & assets of the Company in its books of accounts; and for better presentation of the financial position of the Company, the Board of Directors has decided to write off the Company in accordance with section 100 to 104 of the Companies Act, 1956 and other applicable provisions. c. The Reduction of Capital is proposed for the aforesaid reasons. The Board of Directors and Management of Petitioner Company are of the opinion that the proposed reduction of capital is in best interest of the Company and its stakeholders.
(3.) The Board of Directors of the company is said to have approved the reduction of the paid up equity share capital of the Petitioner Company on 16.05.2016 and further it is also seen that the same has been approved by the Equity Shareholders in the Extra Ordinary General Meeting held on 28.09.2016 vide Special Resolution passed there at. Subsequently, the Company Petition before the Hon'ble High Court seems to have been preferred.;