1. THE appeal No. 129 of 1958 is from an order sanctioning a scheme of arrangement under section 391 of the Indian Companies Act, 1956. The appeal No. 130 of 1958 is from an order confirming' reduction of capital. Both these orders were passed by Bose, J. The two appeals have been heard together. This judgment is intended to cover both the appeals.

2. THE respondent company is a public company limited by shares. It was incorporated in 1945 under the Indian Companies Act, 1913. The appellant holds 2000 preference shares in the share capital of the company. The authorised share capital of the company is Rs. 50. 00,000/- divided into 3,75. 000 ordinary shares of Rs. 10/- each, 10,000 5 per cent cumulative participating preference shares of Rs. 100/- each and 50,000 deferred shares of Rs. 5/- each. The memorandum of the company states that shares have the rights, privileges and conditions attached thereto as are provided by the regulations of the company for the time being with power to increase and reduce capital of the company and to attach thereto respectively such preferential, deferred, qualified or special rights or privileges or conditions as may be determined by or inc