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2020 (10) TMI 1038 - Tri - Companies LawReduction of Share Capital - section 66 of the Companies Act, 2013 - Board of Directors are of the view that the Applicant Company does not require such excess capital for its business operations and such excess capital impacts the return on equity and earnings per share - HELD THAT:- The Board of Directors has passed the resolution on 21.11.2019 in the Board meeting which they have accorded approval for reducing the Paid-up share capital of the company. Pursuant to the above notices dated 22.11.2019 along with the Explanatory Statement for convening the Extraordinary General Meeting of all the members of the Applicant Company were sent - That as on 20.11.2019, there are two Secured Creditors and twenty eight unsecured creditors in the Applicant Company. The Applicant Company in this regard has obtained a Certificate from MKPS & Associates Charted Accountants (FRN 302014E) dated 22.11.2019 that the list of Creditors is correct as per the records of the Company. The Applicant has obtained the written consent from unsecured creditors and are annexed as Annexure -12 of the Petition along with written consent of the Secured Creditors filed as additional documents on 13.01.2020 (Pg. 41-44). The total amount of debt of 28 Unsecured Creditors is ₹ 1,11,68,14,744/- and 2 Secured Creditors is ₹ 2,719,084,099/-. The Articles of Association of the applicant company, in Article 9 provides for reduction of the share capital by way of special resolution be passed. Hence, the reduction of share capital is as per the Articles of Association of the Applicant Company - We have gone through the report of the Income Tax Department filed on 06.08.2020 raising certain observations/objections along with the reply dated 17.08.2020 filed by the Applicant in response to the observations/objections. We are of the view that the averments made by the Applicant in response to the observations/objections raised by the Income Tax Department are satisfactory. There is no objection from any quarter in respect of prayer made for reduction of capital as contemplated by the Applicant Company, this Tribunal directs that the reduction of the share capital of the above company as resolved by the special resolution passed at the Extra Ordinary General meeting held on the 26.11.2019. Application allowed.
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