( 1 ) THIS is an application under Section 391 of the Indian Companies Act, 1956, for sanction of a scheme of arrangement involving re-organisation of the share capital of the company. The company was incorporated in June 1945 with an authorised capital of Rs. 50 lakhs divided into 3,75,000 ordinary shares of Rs. 10 each, 10,000, 5 per cent cumulative participating preference snares of Rs. 100/- each and 50,000 deferred shares of Rs. 5 each. The total paid up capital of the company is Rs. 29,20,300 comprising of 1,89,985 ordinary shares of Rs. 10 each, 8,452 preference shares of Rs. 100 each and 35,050 deferred shares of Rs. 5 each. The company carries on the business of manufacturers, exporters and importers of radios, radiograms, gramophones, refrigerators and various electrical goods and equipments. It has its factory at Karampura in Bihar. Although the company was started with the blessings of a very rich financial and managing agents, Karamchand Thapper and Brothers, and has secured the services of foregin technicians, its career has not been a prosperous one. Since 1948 it sustained loss in its business and in 1956 the proportion of the loss assumed such a hug