Delhi High Court
Egon Zehnder Information And ... vs ---- on 25 September, 2012
Author: Indermeet Kaur
$~19
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Judgment: 25.09.2012
+ CO.PET NO. 327/2012
EGON Zehnder Information and Research Services Pvt. Ltd.
..... Petitioner
Through Mr. Mahesh Agarwal, Advocate, With
Mr. Rajeev Kumar, Advocate for
Petitioner.
CORAM:
HON'BLE MS. JUSTICE INDERMEET KAUR
INDERMEET KAUR, J. (Oral)
1. This petition has been filed under Sections 80 and 100 to 104
of the Companies Act, 1956 (for short „Act‟) by EGON Zehnder
Information and Research Services Private Limited (Petitioner
Company) seeking approval of this Court to the proposed
reduction of Capital Redemption Reserve as resolved by its
Special Resolution dated 22nd May, 2012.
2. The registered office of the Petitioner Company is situated at
New Delhi, within the jurisdiction of this Court.
3. Details with regard to the date of incorporation of the
Petitioner Company, its authorized, issued, subscribed and paid
up capital have been given in the petition.
4. Copies of the Memorandum and Articles of Association of
the Petitioner Company as well as the latest audited balance
sheet of the Petitioner Company for the year ended 31st October,
2011 have also been enclosed with the petition.
5. A copy of the Resolution passed by the Board of Directors of
the Petitioner Company on 15th May, 2012 proposing the
Reduction of Capital Redemption Reserve has been placed on
record.
6. By this petition, the Petitioner Company proposes as under:-
The Capital Redemption Reserve Account as on October 31,
2011 of the Petitioner Company be hereby reduced by Rs.
1,52,97,968/- i.e. from Rs. 2,55,00,000/- to Rs. 1,02,02,032/- and
that such amount as has been reduced/cancelled be utilized for
adjusting / writing off the deferred tax assets aggregating to Rs.
61,96,754/- as on October 31, 2011 and Impairment in the value of
assets due to a change in the accounting estimate of useful life of
fixed assets amounting to Rs. 91,01,214/-.
7. Reasons for the reduction of Capital Redemption Reserve
have been stated in paras 8 and 9 of the petition. It is also stated
that reduction of Capital is in the interest of the shareholders and
creditors of the Company.
8. A copy of the special resolution of the Petitioner Company
passed in accordance with the provisions of Section 189 of the
Act at the Extraordinary General Meeting of the Petitioner
Company held on 22nd May, 2012, has been placed before this
Court.
9. It was submitted that the reduction of the Capital does not
involve either diminution of liability in respect of the unpaid
share capital or payment to any shareholder of any paid up Share
Capital, and hence, there is no requirement to comply with
Section 101 (2) of the Act. In view of the same the requirement
to comply with Section 101 (2) of the Act was dispensed with
vide order dated 19th July, 2012.
10. By the same order, notice was directed to be issued to the
Regional Director (Northern Region). Notice was accepted by
Mr. K.S. Pradhan, Deputy Registrar of Companies on behalf of
the Regional Director and Registrar of Companies. Further, it
was also directed that the notice of hearing of the Petition be
published in „The Indian Express‟ (English, Delhi Edition) and
„Jansatta‟ (Hindi, Delhi Edition). Affidavit of service and
publication of notice has been filed by the Petitioner Company
showing compliance regarding service of the petition on the
Registrar of Companies and the Regional Director, Northern
Region, and also regarding publication of citations in the
aforesaid newspapers on 10th August, 2012.
11. The Regional Director, Northern, Ministry of Corporate
Affairs has filed his Affidavit dated 20th September, 2012. The
relevant portion of the said affidavit reads as under:
"3. That the Deponent craves leave to submit that as per Article 1 of
Articles of Association of the Company permits the Company for
Reduction of Capital.
4. That the Deponent craves leave to submit that at para 13 of the
Petition provides as under:-
"Resolved That pursuant to the Provisions of Section 80, 100 to 104
and other applicable provisions, if any of the Companies Act, 1956,
the Article 1 of the Article of Association of the Company read with
Article 46 of Table "A" in the Schedule -I to the Companies Act,
1956 and subject to the approval/confirmation of the Hon'ble Court
of Judicature at New Delhi or any other regulatory authority as may
be prescribed under the Companies Act, 1956, an amount not
exceeding Rs. 2,55,00,000/- (Rupees Two Crore Fifty Five lacks
only) in aggregate out of the balance standing in the Capital
Redemption Reserve Account as on October 31, 2011 be reduced to
adjust the following:-
a. Deferred Tax Assets aggregating to Rs. 61,96,754/- as
on October 31, 2011.
b. Impairment in value of assets due to a change in the
accounting estimate of the Company amounting to Rs.
91,01,214/- in the extent of which the value has been lost for
the assets. "
5. That the Deponent craves leave to submit that the proposed
Reduction of Share Capital has been consented by the equity
shareholders of the Company by a Special Resolution duly passed at
the AGM held on 22.05.2012.
12. No objection has been received to the proposed reduction of
Capital from any other party. Mr. Rajeev Vasudeva, Director
and Authorized Signatory of the Petitioner Company has filed an
affidavit dated 21.09.2012 confirming that no objection has been
received by the Petitioner or their legal counsel pursuant to the
notice of hearing published in the aforesaid newspapers.
13. In view of the facts and circumstances of the present case,
the Resolution dated 22.05.2012 and the Form of Minutes
proposed at "Annexure K" to be registered under Section 103 (1)
(b) of the Act for reduction of Capital Redemption Reserve of
the Petitioner Company are approved. Henceforth, the deferred
tax assets to the tune of Rs. 6,196,754/- (Rupees Sixty One
Lakhs Ninety Six Thousand Seven Hundred and Fifty Four
Only) as appearing in the Annual Accounts of the Company on
31st October, 2011 and Impairment in value of assets due to a
change in the accounting estimate of the useful life of fixed
assets to the tune of Rs.9,101,214/- (Rupees Ninety One Lakhs
One Thousand Two Hundred and Fourteen Only) be adjusted/set
off against Capital Redemption Reserve of Rs.25,500,000/-
(Rupees Two Crores Fifty Five Lakhs Only) as appearing in the
Annual Accounts of the petitioner Company on 31st October,
2011 and consequently, the Capital Redemption Reserve shall be
reduced accordingly. The Annual Accounts of the Petitioner
Company as on October 31, 2012 will incorporate the above
reduction/adjustments.
14. The order passed today and the minute approved by this
Court shall be registered in accordance with Section 103 of the
Act by the Registrar of Companies and shall be published in
terms of sub-Section (3) of Section 103 in the „The Indian
Express‟ (English) and „Jansatta‟ (Hindi) by the Petitioner
Company.
15. The formality of adding the words „AND REDUCED‟ to the
name of the Company be dispensed with.
16. Learned counsel for the Petitioner Company states that the
Petitioner Company would voluntarily deposit a sum of Rs.
1,00,000/- with the Common Pool Fund of the Official
Liquidator within three weeks from today. The said statement is
accepted.
17. The petition is allowed in the above terms.
Order Dasti.
INDERMEET KAUR, J
SEPTEMBER 25, 2012
A
