In re General Motors India Private Limited (NCLT Chandigarh)
General Motors India Private Limited filed an application under Section 66 of the Companies Act, 2013, seeking confirmation from the NCLT Chandigarh for the proposed reduction of its issued, subscribed and paid-up equity share capital. The company stated that it had incurred substantial operating losses over several financial years due to prolonged decline in demand for its products and various market-related factors, resulting in significant accumulated losses and erosion of net worth.
As on 31.03.2025, the company had accumulated losses amounting to Rs. 8,795.18 crore. It proposed to reduce its equity share capital by extinguishing and cancelling equity shares aggregating to Rs. 8,000 crore. Out of this amount, Rs. 7,560 crore was proposed to be adjusted against accumulated losses, while Rs. 440 crore was proposed to be paid to equity shareholders at Rs. 0.55 per share, based on a valuation report issued by a registered valuer. The reduction involved extinguishment of 7,99,06,35,002 ordinary equity shares and 93,64,998 Class-A equity shares.
The company submitted that the reduction would realign its capital structure, provide a more accurate reflection of its financial position, and return capital considered surplus to requirements. The Board of Directors approved the proposal on 29.09.2025, and shareholders approved it through a special resolution passed at the Extraordinary General Meeting held on 03.10.2025.
