Authorised Share Capital

Amount in Rs.

50,00,000 equity shares of Rs.10/- each

5,00,00,000

Total

5,00,00,000

Issued, Subscribed & Paid-Up Capital

26,73,400 equity shares of Rs.10/- each

2,67,34,000

Total

2,67,34,000

Para

Representations by the Regional

Director

Response from the Petitioner

Company

6

ROC, Mumbai in his Report No. ROC/Sec 66/206/2022-23/951 dated 08.12.2023, inter-alia mentioned that there is no inspection, investigation, inquiry, prosecution pending against

the company. Further the ROC,

As far as the representation of the ROC Mumbai, as stated in Para 6 of the report of the Central Government is concerned, the Petitioner Company affirm that the present reduction of

share capital does not envisage any

Mumbai has made his observation at

compromise or arrangement with

para no. 23 of his report and stated

creditors, as no sacrifice is called for

that,

from the creditors. The rights of the

“1. “1. Interest of the Creditors and

creditors are not affected as all the

minor shareholders/ stakeholder

creditors would be paid off in the

should be protected.

ordinary course of business. Hence, I

2. 2. Hon’ble NCLT, Mumbai

affirm that the interest of creditors is

Bench may be decided the matter on

duly protected. Further, the Petitioner

its merits.”

Company is a wholly-owned

subsidiary of ILP Core Ventures II

Pte. Ltd. and does not have any

minority shareholders. Hence, the

question of rights and interest of

minority shareholders being affected

does not arise.

7(A)

Provisions of section 52 of the

So far as the representation in

Companies Act, 2013 is reproduced as

paragraph 7(A) of the Report of the

below-

Regional Director is concerned, the

“Application of premiums received on

Petitioner Company submits that the

issue of shares-

proposed reduction is in compliance

(1) Where a company issued shares at

with the provisions of Section 52 of

a premium, whether for cash or

the Companies Act, 2013. The

otherwise, a sum equal to the

Company Petition for confirmation of

aggregate amount of the premium

reduction of share capital has been

received on those shares shall be

filed under Section 66 read with

transferred to a ―securities premium

Section 52 of the Companies Act,

account and the provisions of this Act

2013. Section 52 of the Companies

relating to reduction of share capital of

Act, 2013 provides that “where a

a company shall, except as provided in

company issues shares at a premium,

this section, apply as if the securities premium account were the paid-up share capital of the company.

(2) Notwithstanding anything contained in sub-section (1), the securities premium account may be applied by the company—

1. towards the issue of unissued shares of the company to the members of the company as fully paid bonus shares;
2. in writing off the preliminary expenses of the company;
3. in writing off the expenses of, or the commission paid or discount allowed on, any issue of shares or debentures of the company;
4. in providing for the premium payable on the redemption of any redeemable preference shares or of any debentures of the company; or
5. for the purchase of its own shares or other securities under section 68.

(3) The securities premium account may, notwithstanding anything contained in sub-sections (1) and (2), be applied by such class of companies, as may be prescribed and whose

financial statement comply with the

whether for cash or otherwise, a sum equal to the aggregate amount of premium received on those shares shall be transferred to a “securities premium” account and the provisions of the Act relating to reduction of share capital of a company shall, except as provided in this section, apply as if the securities premium account were the paid up share capital of the company”. Therefore, as can be seen, if the securities premium is used for purposes other than those specified in sub section 2 of section 52 of the Companies Act, 2013, it is deemed to be a reduction of share capital. In the instant case since the Petitioner Company is utilizing the securities premium for items other than those mentioned in sub section 2 of section 52 of the Companies Act, 2013, hence it is treated as a reduction of share capital of the Petitioner Company.

accounting standards prescribed for such class of companies under section 133,—

1. in paying up unissued equity shares of the company to be issued to members of the company as fully paid bonus shares; or
2. in writing off the expenses of or the commission paid or discount allowed on any issue of equity shares of the company; or
3. for the purchase of its own shares or other securities under section 68.” In view of the provisions of this section

52 of the Companies Act, 2013 the Petitioner shall satisfy the Hon’ble NCLT that the reduction of capital application is also fulfilling the requirements of section 52 of the

Companies Act, 2013.

7(B)

Applicant to submit an Affidavit to the effect that the interest of the creditors and all stakeholders and Government Revenue are protected as well as statutory dues are paid off.

So far as the representation in paragraph 7(B) of the Report of the Regional Director is concerned, the Petitioner Company submits that the proposed reduction is for the benefit of the Petitioner Company and its shareholders and the interest of the creditors of the Petitioner Company is

not adversely affected by the present

Company Petition. Further, there is no compromise or arrangement with the creditors of the Petitioner Company and there is no reduction in amount payable to any of the creditors of the Petitioner Company, as their respective dues will be paid in the ordinary course of business. The Petitioner Company by way of this Affidavit undertakes to protect the interest of its creditors, all stakeholders and Government Revenue and pay all the statutory dues in ordinary course in accordance with provisions of the law, subject to appropriate remedies available to the

Petitioner Company.

7(C)

and (D)

C) The tax implication if any arising out of the proposal for reduction is subject to final decision of Income Tax Authorities. The approval of the Company Petition by this Hon’ble Court may not deter the Income Tax Authority to scrutinize the tax return filed by the Company after giving effect to the proposed reduction. The decision of the Income Tax Authority is binding on the petitioner Company.

Further the payment made to the

o far as the representation in paragraph 7(C) & (D) of the Report of the Regional Director is concerned, the Petitioner Company submits that it shall comply with all the applicable provisions of the Income Tax Act. The Petitioner Company undertakes that approval of this Company Petition by the Hon’ble Tribunal shall not deter the Income-tax Authorities to scrutinize the Income-tax Return filed

by the Petitioner Company after

shareholders shall be subject to payment of Income Tax or Capital Gain Tax, as the case may be in the hands of recipient’s shareholders.

D) Further, any amount paid to the shareholders above the face value of paid-up share capital i.e. INR 10 per share is treated as deemed dividend u/s 2(22) of the Income Tax Act, 1961 to the extent paid out of general reserve (accumulated profit) and remaining amount will be transferred to capital gain in the hands of the recipient shareholders at INR 521 per share are being paid on 4,30,742 equity shares adjusted against the Securities Premium Account and therefore, the company and recipients shareholders shall undertake to pay Income Tax/TDS as per the provisions of Income Tax Act, 1961.

giving effect to the proposed capital reduction. It is further submitted that the Petitioner Company and the shareholders will be subject to the applicable tax implications arising out of the Company Petition which will be dealt with in accordance with the provisions of the Income Tax Act. It is further submitted that the capital gain tax, if any, or tax arising out of provisions of section 2(22) of the Income-tax Act, 1961 or any other tax implications arising out of the Company Petition in the hands of the shareholders or the Petitioner Company shall be paid / complied by them in accordance with the provisions of the Income-tax Act, 1961. Further, the decision of the Income-tax Authority shall be binding on the Petitioner Company, subject to appropriate remedies and right to appeal available to the Petitioner Company under the provisions of the Income-tax Act, 1961 or any other

applicable law in this regard.

7 (E)

It is respectfully submitting that the petitioner company is having foreign shareholder, therefore petitioner

So far as the representation in paragraph 7(E) of the Report of the Regional Director is concerned, the

company may be directed to comply with the FERA/FEMA regulation and provide approval from the RBI before approval of the scheme as the shareholders is ILP Core Ventures II Pte Ltd is foreign entity.

Petitioner Company submits that the payment to the non-resident shareholder, whose shares are being reduced is in compliance with the provisions of the Foreign Exchange Management Act, 1999 read with Foreign Exchange Management (Non- Debt Instruments) Rules, 2019, as amended from time to time (“FEMA”). As the transfer of shares pursuant to proposed reduction of share capital is in compliance with FEMA, hence no specific approval of Reserve Bank of India is required. The Petitioner Company hereby undertake to file/ submit the Form FC-TRS and make necessary compliances with the Reserve Bank of India through its Authorised Dealer Category – I Bank in relation to reduction of share capital and comply with provisions of FEMA and RBI guidelines, as may be

required from time to time.

7 (F)

It is observed the company has one corporate body shareholders namely ILP Core Ventures II Pte Ltd having shareholding of 100 %, but Company has not filed Form BEN-2 declaring

name of the Beneficial Owner of the

So far as the representation in paragraph 7(F) of the Report of the Regional Director is concerned, the Petitioner Company submits that ILP Core Ventures II Pte. Ltd. was the

parent entity holding 100% shares of

Shareholding as its shareholders on

the Petitioner Company as on March

31.03.2023 and 31.07.2023 in

31, 2023 and as on July 31, 2023.

compliance of section 90 of the CA,

Also, none of the individual

2013, thus the Petitioner Company

shareholders, acting alone or together,

shall undertake to comply with the

or through one or more persons or

requirements of Section 90 of the CA,

trust, holds indirectly, or together with

2013 and Companies (Significant

any direct holdings, 10% or more of

Beneficial owners) Rules, 2018.

the shares or voting rights of the

Petitioner Company, hence filing of

Form BEN-2 is not applicable to the

Petitioner Company. The Petitioner

Company further submits that it would

comply with the provisions of Section

90 of the Companies Act, 2013 read

with the Companies (Significant

Beneficial Owners) Rules, 2018

amended from time to time and make

necessary filings with the Registrar of

Companies, if required and applicable

under the provisions of law. In case

the Petitioner Company has not

complied with the aforesaid

provisions, if applicable, liberty is

given to the concerned Registrar of

Companies to take appropriate

remedies against the Petitioner

Company in accordance with law with

respect to the above issue, subject to

availability of reliefs and remedies to

the Petitioner Company under the applicable provisions of the Companies Act, 2013. Without prejudice to the above, the Petitioner Company shall continue to remain in existence, post the reduction of share capital becoming effective and sanction of this Company Petition shall not have any prejudicial impact on the powers and rights of the concerned Registrar of Companies in accordance with the applicable provisions of the Companies Act,

2013.