In re Sai Service Private Limited (NCLT Mumbai)
The National Company Law Tribunal (NCLT) considered a petition filed by Sai Service Private Limited seeking confirmation of a special resolution approving reduction of its share capital under Section 66 of the Companies Act, 2013. The proposal contemplated cancellation of up to a maximum of 11 equity shares, representing approximately 0.67% of the company’s issued, subscribed and paid-up equity share capital, together with cancellation of fractional shares held in the Share Suspense Account. The reduction applied to eligible shareholders holding two or fewer equity shares and shares held in the Investor Education and Protection Fund (IEPF), at the option of the eligible shareholders. The consideration approved was ₹58,82,870 per equity share, with ₹12,09,518 payable towards fractional shares. The special resolution was approved by the requisite majority on 27 June 2022.
The petitioner explained that, as per its audited balance sheet as on 31 March 2021, it had a paid-up share capital of ₹4,07,30,140 divided into 1,629 equity shares of ₹25,000 each and fractional shares valued at ₹5,140 in the Share Suspense Account. The company had been delisted from the Bombay Stock Exchange during FY 2008-09, following which the promoters made an exit offer to public shareholders. Since many shareholders could not participate in that exit offer, the company reorganised its share capital during FY 2013-14 by consolidating shares and increasing the face value from ₹10 to ₹25,000 per share. The present proposal was intended to provide another exit opportunity to identified shareholders and cancel the fractional shares in the Share Suspense Account. The company stated that the reduction would rationalise its capital structure and would not adversely affect the interests of shareholders or creditors.
