Pannalal Bhansali Vs Bharti Telecom Limited & Ors. (Supreme Court of India)
Supreme Court held that section 66 of the Companies Act, 2013 doesn’t require mandatory obtaining or circulating of formal valuation report from an approved/registered valuer for reduction of share capital.
Facts- The appellants, investors in a minority, cry foul on the allegation of their being arbitrarily disgorged of their shareholdings and eased out of the 1st respondent company, (BTL for brevity) in a grossly unfair manner, making a sham of an evaluation fixing the share price at an unreasonably low value. Shorn of the details, the 1st respondent, a closely held company having 1.09% of its shareholding with individuals, decided to reduce its share capital under Section 66 of the Companies Act 20131 by cancelling 28,457,840 equity shares held by the identified minority shareholders by paying an amount of Rs.163.25/- per equity share of Rs.10/- each. The resolution was passed by a Special Resolution with a majority of more than 99.90%, the sanction for which was sought before the National Company Law Tribunal.
The NCLT found that the decision to deduct the Dividend Distribution Tax from the price fixed for the individual shares was arbitrary and directed the BTL to pay the identified individual investors; without the tax deduction, Rs.196.80/- per equity share. BTL acceded to the NCLT’s order but thirty-five of the shareholders, those who voted in favour of the reduction of share capital, filed appeals before the National Company Law Appellate Tribunal (NCLAT hereinafter), unsuccessfully, some of whom are before us; precisely eleven of them. The intervention attempted by some others were disallowed by us.
