9911796707
TMI Blog2018 (8) TMI 1613X X X X Extracts X X X X X X X X Extracts X X X X ..... al failed to notice the ‘Explanation’ below Section 230, which makes it clear that even for reduction of share capital effected in pursuance of the order of the Tribunal under Section 230, the provision of Section 66 shall not apply. Having held that the Tribunal failed to notice the aforesaid observations, we have no other option but to set aside the order dated 8th December, 2017 passed in CA (CAA)-105(ND)/2017 which is accordingly set aside. The case is remitted to the Tribunal to decide the application under Section 230 in accordance with law after notice and hearing the parties. - Company Appeal (AT) No. 416 of 2017 - - - Dated:- 16-7-2018 - Mr. S.J. Mukhopadhaya, Chairperson And Mr. Member, (Judicial) For The Appellant : Mr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he relevant provision and not under the one presently under which, the application has been preferred. 4. Hence, the Tribunal is constrained to dismiss the application as provisions for exclusive reduction of share capital is provided elsewhere in Companies Act, 2013 and the applicant, if so advised may prefer under the said provision of the Act of 2013. This application is accordingly dismissed. No order as to costs. 3. Section 391 of the Companies Act, 1956 related to Power to Compromise or make Arrangements with Creditors and Members . The Hon ble High Court was empowered on an application of the Company or any creditor or member of the Company or in case of a company which is being wound up, of the liquidator, to pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts relating to the company, such as the latest financial position of the company, the latest auditor s report on the accounts of the company and the pendency of any investigation or proceedings against the company; ( b) reduction of share capital of the company, if any, included in the compromise or arrangement; ( c) any scheme of corporate debt restructuring consented to by not less than seventy-five per cent. of the secured creditors in value, including- ( i) a creditor s responsibility statement in the prescribed form; ( ii)safeguards for the protection of other secured and unsecured creditors; ( iii) report by the auditor that the fund requirements of the company after the corporate debt restructuring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; ( 1) Subject to confirmation by the Tribunal on an application by the company, a company limited by shares or limited by guarantee and having a share capital may, by a special resolution, reduce the share capital in any manner and in particular, may- ( a) extinguish or reduce the liability on any of its shares in respect of the share capital not paid-up; or ( b) either with or without extinguishing or reducing liability on any of its shares,- ( i) cancel any paid-up share capital which is lost or is unrepresented by available assets; or ( ii) pay off any paid-up share capital which is in excess of the wants of the company, alter its memorandum by reducing the amount of its share capital and of its shares ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provision of Section 66 shall not apply for reduction of share capital. Such order can be passed by the Tribunal under Section 230 of the Act. 8. In view of the aforesaid provisions, we hold that the Tribunal failed to notice the Explanation below Section 230, which makes it clear that even for reduction of share capital effected in pursuance of the order of the Tribunal under Section 230, the provision of Section 66 shall not apply. 9. As noticed above, earlier the Hon ble High Courts used to entertain application(s) under Section 391 for reduction of share capital. This will be evident from the decision of the Hon ble Bombay High Court in Investment Corporation of India Ltd.─ (1987) 61 Com Cases 92 Bom ; Hon ble High ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
