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Issues:
Reduction in share capital under sections 101, 102, and 103 of the Companies Act, 1956. Analysis: The petition filed by the Company sought a reduction in its share capital from Rs. 32,85,42,000 to Rs. 16,42,71,000 by cancelling half of the issued subscribed and paid-up share capital. The Company's memorandum of association, as per clause 10, allowed for such a reduction by way of a special resolution. A notice was issued to all shareholders and creditors, and a resolution was passed by the shareholders on 8-8-2008. The absence of objections from shareholders following the advertisement in newspapers indicated no objection to the reduction. The Court confirmed the reduction of share capital as per the special resolution dated 8-8-2008, allowing the necessary formalities to be completed by the Registry in accordance with Form-31 under the Company Court Rules, 1959. The application for reduction in share capital was thus allowed. This judgment addresses the legal process and requirements for reducing share capital under specific sections of the Companies Act, 1956. It emphasizes the importance of following the company's memorandum of association and obtaining shareholder approval through a special resolution. The Court's consideration of the lack of objections from shareholders following proper notification highlights the significance of transparency and communication in such corporate decisions. The directive to complete formalities as per the Company Court Rules ensures compliance with regulatory procedures. The judgment ultimately upholds the Company's application for the reduction in share capital, signifying the Court's approval of the process followed and the decision made by the Company.
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