IN RE Vs. MULTI SERVE ROLLS LIMITED

JUDGEMENT

(1.) This Company Petition is filed under sub section (1) of Section 14 of the Companies Act, 2013 (Act, 2013) , seeking approval of this Tribunal to the conversion by altering the Articles of Association, as sought to be effected by a Special Resolution passed at the Extra-Ordinary General Meeting (EOGM) held on 30.12.2016, for the change of status of the Company from "Public Limited Company" to " Private Limited Company". M/s.MuIti Serve Rolls Limited (the company) having its registered office at 77/1 A, Park Street, 2nd Floor, Room No.7, Kolkata - 700016 has filed the Company Petition.

(2.) Rule 68 of the NCLT Rules, 2016 stipulates filing of a petition under sub-section (1) of section 14 of the Companies Act, 2013 for the conversion of a public company into a private company, in the prescribed format and the manner accompanied by such documents/information and requisite filing fee as mentioned in the said Rule. The instant Company Petition has been filed in terms of the said Rule.

(3.) The brief facts that emerged from the petition are that the Company was originally incorporated as a Private Company limited by shares on 03.04.1986 with 03 members; but in course of time, the total numbers of members, exceeded the statutory limit of 50, and the company was changed to deemed public limited company under section 43A of the Companies Act, 1956 and accordingly, the name of the company was changed to Multi Serve Rolls Limited on 31.03.1997.. The authorised share capital of the Company is Rs.4,50,00,000/- and the issued subscribed and paid-up capital of the Company is Rs.4,50,00,000/-. The Board of Directors of the Company comprises 01 Managing Director and of 03 Directors and there are 41 (Forty-one) shareholders holding 45,00,000 shares of Rs.100/-each. The company is an unlisted public company and engaged in the business of manufacturing rolls and allied products. The Board of Directors of the petitioner Company has passed a resolution at the meeting of the Board on 09.12.2016, approving the proposed alteration of the Articles of Association of the Company and decided to call an EOGM of the Members of the Company on 30.12.2016 to obtain consent on this line. After due notice to the members, EOGM has been called and held on 30.12.2016 A Special Resolution has been passed at the said EOGM pursuant to the section 13 & 14 of the Companies Act, 2013 and other applicable provisions and rules made thereunder, for conversion of the Company into a "Private Limited Company" and name of the Company be changed from "Multi Serve Rolls Limited" to "Multi Serve Rolls Private Limited" by addition of the word "Private" before the word 'Limited'. A new set of Articles of Association, as applicable to the Private Limited Company, has also been approved by 35 (Thirty-five) members out of total 41 (Forty-one) members and adopted the new set of Articles of Association of the Company. The reason for conversion into Private Limited Company, as claimed in the petition, is that the company has been in operation for quite some time and there has not been any involvement of public in the shareholding and / or management of the company. Accordingly, it was thought appropriate to convert the company into a Private Limited Company to avoid tedious compliances and to obtain privileges which are available to the public limited company under the Companies Act, 2013 which would help the management to carry out its affairs efficiently and economically. The conversion of the petitioner company into a private company will not have any adverse effect on any of the shareholder, creditor or any other stakeholders of the company