1) What is the procedure of reducing the share capital 2) is there any limited % of reducing share capital 3) section of companies act,1956 applicable to reduction in share capital
01 April 2010
Hi Vandana & other who will read this message,
I refer section 100 of companies act,1956 for reduction in share capital but i have this practicle problem that
A co. is closely held company by a family & one of the brother want to sale his share since it closely held co. no outsider buyer will be interested in buying shares & even his family members(brothers) are not willing to buy shares thus is there any way he can take his share of money out from co. & is there any limit to reduce the no of shares to the extent of issued & paidup capital
whter this point of section 100 can be considered for reducing the share of capital in above case
1)either with or without extinguishing or reducing liability on any of its shares, pay off any paid-up share capital which is in excess of the wants of the company;
you may assume that co is indifferent about the need of the money
28 April 2010
If the person wants to reduce the share capital just to encash the amount, then i will tell u that in case of reduction of capital, Authorised share capital is reduced and not the paid up capital.
He has to go to the buy back route of section 77A.
CAclubindia
