A listed company with a Paid Up Capital of Rs.8,86,20,000/- consisting of 88,62,000 shares of Rs 10 each went into liqudiation. It had reserves of Rs 6,16,23,000. The revival Scheme sanctioned by the Hon'ble High Court allowed the Company, after getting shareholder approval, to reduce the face value of the equity shares from Rs 10 to Re 1 and use the reserves and the written down capital amount to set off 7 35 17 949/-. The Company had Calls in arrears aggregating Rs 2 34 02 010/- covering about 23 40 000 shares.
If we reduce capital on the full amount and then subtract the calls in arears we get negative Capital?
I invite help in the form of suggestions how to treat this problem
CAclubindia
