IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICITON COMPANY PETITION NO 56 OF 2008 In the matter of Section of Section 100 to 103 of the Companies Act, 1956; And In the matter of Reduction of Share Capital of Compuage Infocom Limited Compuage Infocom Limited… ..Petitioner Company CORAM: A.M KHANWILKAR.J DATE: 15th FEBRUARY 2008 Hemant Sethi i/b Hemant Sethi & Co., Advocates for the Petitioner P.C 1. This is a petition for seeking Courts approval for reduction of the Share Capital as approved by the Equity Shareholders, 12% Cumulative Redeemable Preference Shareholders (B Series) and 2% Cumulative Redeemable Preference Shareholders (C Series) in their respective meetings held on 14th September 2007. 2. The reasons for reduction of Share capital is stated in paragraph 7 & 8 of the Petition and it is averred that the Board of Directors in its Meeting held on August 10, 2007 have passed a resolution for providing for following unproductive and unrecoverable assets: a)Goodwill that has arisen pursuant to amalgamation of the Company with Worldwide Infocom Ltd in the year 1999 -2000 to be written off; b)Debtors of Worldwide Infocom Ltd and Compuage Software Technologies Private Limited, which the Petitioner Company has not been able to recover despite repeated efforts; c) Inventory belonging to Worldwide Infocom Ltd , which has become obsolete and hence cannot be sold. d) Miscellaneous Expenditure 3. It is further stated that the said unproductive and unrecoverable assets are not recoverable by the Petitioner Company during its normal course of business, it would be apt for the Petitioner Company to write off the said amounts against the paid-up share capital of the Company. The Petitioner Company therefore proposes to write off Goodwill, Bad Debts Non Moving Inventory and Miscellaneous Expenditure against the capital and profit and loss account and general reserve account of the Petitioner Company as detailed in the Resolution. 4. In paragraph 18 it is further stated proposed reduction in capital does not involve any financial outlay/outgo on the part of the Petitioner and as such will not cause any prejudice to the creditors of the Petitioner and that reduction of Capital does not involve either diminution of any liability in respect of unpaid capital or payment to any shareholder of any paid-up capital. Further the proposed adjustment would not in any way adversely affect the ordinary operations of the Petitioner 5. The Petitioner has send notices to all its Equity and Preference shareholders (“B” & “C” Series ) along with explanatory statement in compliance with provisions of the Act for convening Extraordinary General meeting for which Special Resolution has been unanimously passed by all the Equity and Preference shareholders (“B” & “C” Series ). Same is annexed at Exhibits- E & F to the petition. Affidavit of service has been filed proving publication of notices in newspapers. 6. In light of above, Mr Sethi appearing for Petitioner, seeks sanction to the reduction of share capital. 7. Having perused the petition and the annexures thereto, in my view, the petition deserved to be succeed and is accordingly made absolute in terms of prayer clause (a) to (c). 8. All concerned parties to act on ordinary copy of order and the form of minutes annexed to this petition. Petitioner to publish notices in the same newspapers and also in the Maharashtra Government Gazette about registration of Order and minutes of reduction by the concerned Registrar of Companies, Mumbai. ( A.M Khanwilkar J)