SPECTRASOFT TECHNOLOGIES PRIVATE LIMITED Vs. STATE

JUDGEMENT

(1.) This petition is filed under Sections 100 to 104 of the Companies Act, 1956, read with Rules 11(a)(3) and 46 of the Companies (Court) Rules, 1959, for confirming the reduction of Equity Share Capital of the petitioner Company duly approved by the equity shareholders of the petitioner Company at an Extra-ordinary General Meeting thereof held on 15.12.2014 at the registered office of the petitioner Company be confirmed by this Court so as to be binding on all shareholders and creditors of the petitioner Company and the petitioner Company; to issue necessary and proper directions; to approve the proposed minute; and not requiring the petitioner to add the words "and reduced" to its name as the last words thereof.

(2.) Heard Mr.A.M.Ilango, learned counsel appearing for the petitioner and Mr.M.Gopikrishnan, learned Additional Central Government Standing Counsel appearing for the Regional Director, Southern Region, Ministry of Corporate Affairs, Chennai.

(3.) According to the petitioner Company, it is presently engaged on the business of design, develop, implement, make, install, operate, maintain, market, buy, import, export, sell, license computer software, embedded software, databases, computer systems and programme products & services.The Board of Directors of the petitioner Company thought it fit to reduce some portion of paid up Share Capital by way of writing off losses pertaining to previous years to the extent of Rs.17,45,00,000/- which is not represented by the available assets. Section 100 of the Companies Act, 1956, provides for reduction of Equity Share Capital. Article 7(b) of the Articles of Association of the petitioner Company permits the petitioner Company from time to time to reduce its Share Capital in any manner permitted by law. Accordingly, the petitioner Company is proposing to reduce its Paid-up Equity Share Capital of the shareholders by Rs.1,74,50,000/- shares of Rs.10/- each held by the shareholders. The nature of business carrying on is detailed in the Memorandum & Articles of Association and the same is marked as Annexure-A. The Authorized Share Capital of the petitioner Company as on 20.11.2014 is Rs.23,00,00,000/- (Rupees Twenty Three Crore only) divided into 1,95,00,000 (One Crore Ninety Five Lakh) Equity Shares of Rs.10/ each and 35,00,000 0% Non-cumulative Redeemable Preference Shares of Rs.10/- each. The issued, subscribed and paid-up capital of the petitioner Company as on 20.11.2014 was Rs.22,16,66,800/- (Rupees Twenty Two Crore Sixteen Lakh Sixty Six Thousand Eight Hundred only) divided into 1,86,66,680 (One Crore Eighty Six Lakh Sixty Six Thousand Six Hundred and Eighty) Equity Shares of Rs.10/- each and 35,00,000 0% Non-cumulative Redeemable Preference Shares of Rs.10 each. Therefore, the petitioner Company has adequate reserves to meet the proposal for reduction of the Paid-up equity share capital of the Company. Upon the said reduction of equity share capital, the Paid-up equity share capital account of the Company shall stand reduced to Rs.4,71,66,800 (Rupees Four Crore Seventy One Lakhs Sixty Six Thousand and Eight Hundred only) divided into 12,16,680 (Twelve Lakhs Sixteen thousand Six Hundred and Eighty) Equity shares of Rs.10/- each and 35,00,000 0% Non-cumulative Redeemable Preference Shares of Rs.10 each. A copy of the Resolution passed by the Board of Directors of the petitioner Company on 22.11.2014 is marked as Annexure-B. A copy of the audited Balance Sheet of the petitioner Company as on 31.03.2014 is marked as Annexure-C. A copy of the Special Resolution passed by the Board of Directors of the petitioner Company at its Extra Ordinary General Meeting held on 15th December, 2014, is marked as Annexure-E. A copy of the Form of Minute is marked as Annexure-F. A Certificate showing "No Secured Creditors" from a Chartered Accountant is marked as Annexure-I. The consent affidavits from preference shareholders is marked as Annexure-J. According to the petitioner Company, the reduction of the Paid-up equity share capital of the petitioner Company will not in any way compromise the interests of or cause any prejudice to the creditors of the petitioner Company.