1. By way of this petition, the petitioner-Company has prayed for the following reliefs:-
"A) That the reduction of capital resolves by the [special resolution] set out in paragraph 9 above be confirmed;
B) That to this end all inquiries and directions necessary and proper be made and given;
C) That the [proposed minute] be approved; and D) Such other order may be made in the premises as to the Court shall seem fit."
2. Upon hearing Mr.S.P. Majmudar, learned counsel appearing for the petitioner, this Court on 30.03.2012 admitted the petition and issued directions for advertisement of the petition in "Indian Express' (English edition, Vadodara) and "Divya Bhaskar" (Gujarati edition, Vadodara). Publication in Government Gazette was dispensed with.
3. It has been submitted by Mr.Majmudar that the reduction of capital involves payment to the share holders of paid up capital amounting to Rs.70,02,450/- and that as of 30.09.2011 the Company does not have any creditors and, therefore, there are no persons entitled to object to the Company's reduction of capital. A certificate issued by statutory auditors of the Company to the effect that the Company does not have any creditors as on 30.09.2011 is also enclosed with the petition as Exh.E.
4. The petitioner has annexed the notice convening extraordinary general meeting of the Company together with explanatory statement under Section 172(3) of the Companies Act, 1956 (the Act) as Exh.C. The copy of the Minutes of the Meeting of extraordinary general meeting of the Company held on 04.10.2011 is annexed as Exh.D to the petition. The said special resolution is also set out in Paragraph No.9 of the petition and the form of minute proposed to be registered under Section 103(1)(b) of the Act is set out in paragraph No.12 of the petition.
5. The affidavit of the director of the Company, namely, Dr.Kirit Vyas dated 01.05.2012 is placed on record stating that the hearing of the petition has been duly advertised in Indian Express and Divya Bhaskar, Vadodara editions, as per the directions issued by this Hon'ble Court vide order dated 30.03.2012. Despite the publication of the advertisement as already notice, there is no appearance and there are no objections to the proposed reduction of capital. Hence, in light of what is stated hereinbefore, proposed action of the petitioner is required to be confirmed. Accordingly, the special resolution passed in general body meeting dated 04.10.2011 stands confirmed. The special resolution dated 04.10.2011 reads as under:-
"RESOLVED THAT the pursuant to the provisions of Section 100(1)(c) of the Companies Act, 1956 and other applicable provisions of the Act, if any, Article 46 of Table A of Schedule I, to the Companies Act, 1956 read with Article 1 of the Articles of Association of the Company and subject to the confirmation of the Company Law Tribunal / Gujarat High Court, the paid up share capital of the company be and is hereby reduced by paying off 9(nine) out of every 10(ten) equity shares of Rs.100/- each fully paid up held by each of the shareholders by paying a sum of Rs.285/- (Two Hundred and eighty five) per equity share of Rs.100/- each fully paid up.
RESOLVED FURTHER, that consequent upon the reduction of the capital, the issued and paid up equity capital of the Company be reduced to Rs.2,73,000/- divided into 2,730 equity shares of Rs.100/- each fully paid up.
AND RESOLVED FURTHER, that for the reduction of the capital, the sum be appropriated out of amounting standing to the credit of paid up share capital (Rs.24,57,000/-) and amount standing to the credit of the Reserves and Surplus (Rs.45,45,450/-), aggregating to Rs.70,02,450/-."
6. Form of minute proposed to be registered under Section 103(1)(b) of the Act reads as under:-
"Form of Minute.
"The paid up capital of Startronic Enterprises Private Limited, is henceforth Rs.2,73,000/- divided into 2,730/- Equity Shares of Rs.100 each fully paid up, reduced from Rs.27,30,000/- divided into 273000/- Equity Shares of Rs.100/- each fully paid up. At the date of registration of this minute, 2,730 Equity Shares of Rs.100/- each fully paid up have been issued and are deemed to be fully paid up and remaining 27,270 Equity Shares of Rs.100 each are unissued."
7. In response to the notice issued by this Court, the Registrar of Companies represented through learned Senior counsel Mr.M.Iqbal A. Shaikh. It is inter alia contended in the affidavit that the petitioner-company has filed special resolution passed by it under Section 100(1) of the Companies Act, 1956 in its extraordinary general meeting held on 04.10.2011. It is also averred in the said affidavit-in-reply that no complaint or legal proceedings are pending against the company and its directors and no prosecution cases are pending against the company and its directors. It is also submitted that the statutory returns upto financial year ending 31.03.2011 are filed.
8. In the said affidavit, the Registrar of Companies has further averred that in fact, the company was incorporated for carrying out the activities of computer data processing and said business is discontinued since 1993. It is further stated that with effect from 18.01.1991, the Company entered into the business of pharmaceuticals and manufactured bulk drugs and fine chemicals. However, that business has also been sold in the year 1995. Thereafter, the petitioner-Company has not commenced any business and, therefore, it is opined that it is in the interest of the company and its members that the excess capital be returned to the members by way of reduction of capital by paying of 9(nine) out of 10(ten) equity shares of Rs.100/- each fully paid up held by each of the shareholder by paying a sum of Rs.285/- per equity share of Rs.100/- each fully paid up.
9. In response to the said affidavit filed by the Registrar of Companies, the petitioner has filed further affidavits and has clarified that there are no creditors of the petitioner-company and has also stated that reduction of capital has been resolved by passing special resolution and requested that the same may be confirmed. The petitioner-company has also stated that its Articles of Association authorised to reduce its share capital from time to time.
10. Considering the above, the form of minutes is hereby approved.
11. Accordingly, on the said reduction of capital taking effect the paid up equity of the company would be reduced to Rs.2,73,000/- divided into 2,730/- of equity shares of Rs.100/- each fully paid up. Further publication of petition or of this order in newspaper is dispensed with. Fees of Mr.M.Iqbal Shaikh, learned counsel for the Registrar of Companies is quantified at Rs.7,500/- which shall be paid directly by the petitioner.
12. The petition stands disposed of accordingly.
(R.M.CHHAYA, J.) Hitesh Top