Adversely by the said reduction , Court's confirmation , mentioned ways

Thirdly. a petition to the Court for an order confirming the r:-mustbe made. Before confirmirg, the Court will satisfy itseiftbat the in, As of the creditors and different classes of shareholders, if auk are not af c
adversely by the said reduction of capital. The Court will see. (a) that suffieier. notice has been given to eN cry person whose interest may be affected by the alteration; (b) that every objecting creditor has either been paid im full or his consent has been obtained; and (c) that the proposed reduction of share capital is fair and equitable to all kinds of shareholders. If the Court is satisfied m all respects it may make an order confirming the reduction on such terms and conditions as it tluil ks fit. The Court may, for example, order that the company concerned is to use the words. tndRedced as pan of its name for a specified period
Finally, a certified copy of the Court's confirmation order and the changed memorandum must be filed with the Registrar for registration withm three months of the Court's order. The Registrar shall then register the same and issue a certrficate of registration within one month. Reduction will take effect from the date of registration.
Methods of reduction. SQ far as the methods of reducing the share capital arc concerned, the Cotnpanies Act leaves the company free to adopt any method it likes. Section 100, however, specifies the following three methods :Rich a company ulay adopt for reducing its share capital:
(a) it may reduce the I Ability of members on any shares not fully paidup to the extent of uncalled capital or
(bj It write off the lost capital, e.g., capital unrepresented by any available assets; or
(c) It may pay o ff any paid 2ip share capital which is in excess of the needs of tl2e COll'pd21V
It is to be remembered that the above mentioned ways of reducing capital are given only as illustrations The share capital of a company maybe reduced in another way, e.g., cancellation of fully paid-up shares wlucll the holder is willing to get cance'led for Ihe benefit of the company will also result in reduction of capital. Of course, reduction of share capital by means of cancelling the reserve capital', (i.e., that portion of uncalled capital Reich catmot be called up except in the event of winding up) is not permitted Tafa Ad Company vs. Paulin C'lliery Syndicate).
It must, however, be noted that "forfeiture of shares" for non-payment c and redemption of redeemable preference shares" are not treated as Con in share capital, all EDIT each of these powers is strictly guarded tar thea. The reason far not treating these as reduchan of capital is As ' resn. ingto any oftllese acts, the
INCORPORATION OF A COMPANY 93
lo uher, in respect of reduced shares Basic. l(l4). After capital a member of the company (past or present) is liable terence between the reduced noml Dal value of a share and per share. However, the members' liability to pay the original
.hne of Ike shares can be restored in one case. If any creditor, entided dj to the reduction of capital is omitted from the list of creditors, and am the redaction the company is unable to pay h s debts, the Court may, to he claim of such a creditor, order the members to pay that amount on War shares u hich they would have been liable to pay before the reduction
(iii) Variation of the rights of sltiareholders. An alteration of the ax Corundum will also result from a modification of the rights of a class of sba Teholders where such rights are conferred by the memorandum. When there are different classes of shareholders in a company enjoying different dividend and voting rights, then any change in their rights without prejudice to am- existing rights of other classes of shareholders may be brought in accordance with the procedure laid downlmder Sections 106-107 of the Act. .ccordinglv, for effecting the variation of the rights of different classes of shareholder Jirs l, memorandum or articles ofthe company or terms of issue of that class of shares must permit such a variation of nghts. Secondly, a special resolution sanctioning the variation must be passed at a separate meeting of the shareholders of the class affected.