Guidance Note

on

General Meetings

OCTOBER 2017

Price : Rs. 300/- (Exluding postage)

© THE INSTITUTE OF COMPANY SECRETARIES OF INDIA

Al rights reserved. No part of this Publication may be translated or copied in

any form or by any means without the prior written permission of The

Institute of Company Secretaries of India.

Published by :

THE INSTITUTE OF COMPANY SECRETARIES OF INDIA

ICSI House, 22, Institutional Area, Lodi Road,

New Delhi 110 003

Phones : 011-4534 1000, 4150 4444 • Fax +91-11-2462 6727

E-mail info@icsi.edu • Website www.icsi.edu

Printed at : Chandu Press/250/October 2017

(i )

PREFACE TO REVISED EDITION

Section 118 (10) of the Companies Act, 2013 requires every company to observe

Secretarial Standards with respect to General and Board Meetings specified by

the Institute of Company Secretaries of India (ICSI) and approved as such by the

Central Government. The Secretarial Standards on Meetings of the Board of

Directors (SS-1) and Secretarial Standards on General Meetings (SS-2) issued by

the Institute of Company Secretaries of India (ICSI) under Section 118(10) of the

Companies Act, 2013 are effective w.e.f. 1st July, 2015.

Since then the SS-1 and SS-2 have been revised by the ICSI and approved by

the Central Government under Section 118(10) of the Companies Act, 2013,

which are applicable w.e.f. 1st October, 2017.

To facilitate the compliance and smooth implementation of revised Secretarial

Standard on General Meetings (SS-2), this revised Guidance Note elucidate the

basis for setting the particular Standard, explain the procedural & practical

aspects thereof and gives il ustrative examples. This Guidance Notes also

integrate the responses to various issues/queries raised by the stakeholders.

In this Guidance Note, the applicable provisions of SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015 are given in special (three layers)

boxes at the respective places. These do not form part of the Secretarial Standard

and included herein for the purpose of Guidance only.

I place on record my sincere thanks to CS Pavan Kumar Vijay, Chairman and

al the Members of Secretarial Standards Board during the year 2017-18

(list enclosed) in finalisation of this revised Guidance Note on General

Meetings.

I commend the dedicated efforts put in by CS Anamika Chaudhary, Deputy

Director and CS Rakesh Kumar, Executive (Academics) in preparing this revised

Guidance Note on General Meetings, under the leadership of CS Banu

Dandona, Joint Director and overal guidance of CS Dinesh Chandra Arora,

Secretary, ICSI.

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I am confident that this Guidance Note wil be of practical value to all

stakeholders in ensuring the compliance and implementation of revised SS-2

in true letter and spirit.

Improvement is a continuous process and equally applicable to this Guidance

Note. I would personal y be grateful to the readers to offer their suggestions/

comments for further refinement of this publication.

Place : New Delhi

CS (Dr.) Shyam Agrawal

Date : 09.10.2017

President

The Institute of Company Secretaries of India

(iv)

Secretarial Standards Board

(2017-18)

Chairman

Pavan Kumar Vijay, Past President, ICSI

Member (s)

Anil Kumar Murarka, Past President, ICSI

Amit Gupta, Practising Company Secretary, Lucknow

B. Shanmugasundaram, AGM (Secretarial)- Sundram Fasteners Ltd.

Dipti Mehta (Ms.), Practising Company Secretary, Mumbai

Geetika Anand (Ms.), CS & Compliance Officer, Aditya Birla Fashion and Retail Ltd.

J.N. Gupta, Founder & MD, Stakeholders Empowerment Services

Milind B. Kasodekar, Practising Company Secretary, Pune

N. Hariharan, Vice President (Secretarial) & CS, Larsen & Toubro Ltd.

Narayan Shankar, Executive Vice President & CS, Mahindra & Mahindra Ltd.

Parvatheesam Kanchinadham, Company Secretary, Tata Steel Ltd.

R. Ravi, Past President, ICSI

Rajiv Bajaj, Council Member-ICSI

Raju Ranganathan, Former CS & ED (Law), Indian Oil Corporation Ltd.

Rajendra Singhi, Senior Deputy Company Secretary, ITC Ltd.

S.C. Vaudeva, Practising Chartered Accountant, Delhi

S.H. Rajadhyaksha, Consultant,Tata Capital Financial Services Ltd.

S. Sudhakar, Vice President - Corporate Secretarial, Reliance Industries Ltd.

Savithri Parekh (Ms.), Chief Legal & CS, Pidilite Industries Ltd.

Subhash C. Setia, Company Secretary, DLF Limited

Shujath Bin Ali, General Counsel & CS, Parexel International- India

Vineet K. Chaudhary, Council Member-ICSI

Representative Members

C. S. Govindarajan

Representative of MCA

C. D. Srinivasan

Representative of RBI

Pradeeep Ramakrishanan

Representative of SEBI

(v)

Girish Joshi

Representative of BSE

S. Madhavan

Representative of NSE

G.P. Madaan

Representative of ASSOCHAM

B. Murli

Representative of FICCI

Ajay Vaidya

Representative of CI

Pawan Kumar Rustagi

Representative of PHD Chamber of

Commerce & Industry

K. Sripriya (Ms.)

Representative of ICAI

Amit Anand Apte

Representative of ICAI (CMA)

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PREFACE

Secretarial Standards are a codified set of good governance practices which

seek to integrate, harmonize and standardise the diverse secretarial practices

followed by companies with respect to conduct of Meetings and play

indispensable role in enhancing the corporate culture and governance across

the organisations. Secretarial Standards help in improved governance and

compliance, confidence building in minds of investors which ultimately lead to

flow of capital in India and achieving the government’s objective of Make in

India.

The Secretarial Standard on General Meetings (SS-2) has been introduced under

the legal umbrella of Companies Act, 2013 which is first of its kind in the world.

Section 118(10) of the Companies Act, 2013 makes it mandatory for companies

to comply with the Secretarial Standards.

It is a recognition and also an onerous responsibility on the profession of

Company Secretaries and the ICSI, as the Company Secretaries in employment

as wel as in practice are entrusted to ensure the compliance with the applicable

Secretarial Standards.

To facilitate the compliance of Secretarial Standard on General Meetings (SS-2)

by the Corporates, their Boards, Management and Professionals, the Institute

has brought out this Guidance Note. It elucidates, wherever necessary, the

basis for setting the particular Standard, explains its ingredients and gives

il ustrative examples. This Guidance Note also addresses the various issues/

queries/concerns raised by the stakeholders after the issuance of Secretarial

Standards.

I place on record my sincere thanks to CS Pavan K. Vijay, Chairman and all the

Members of the Secretarial Standards Board during the year 2015-16 (list

enclosed) for their tireless efforts in preparation and finalisation of this Guidance

Note on General Meetings.

I also place on record my sincere gratitude to CS N J N Vazifdar, CS Ashok

Chhabra and CS S V Subramanian, former Chairmen of SSB and al members of

SSB til date for their efforts in preparation of Secretarial Standards. My sincere

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thanks also to Members of SSB during the year 2014-15 (list enclosed) when

the Guidance Note on General Meetings was conceptualised and preliminary

draft of Guidance Note was prepared.

I commend the dedicated efforts put in by Secretariat of SSB under the leadership

of CS Alka Kapoor, Joint Secretary and under the overal guidance of CS Sutanu

Sinha, Chief Executive & Officiating Secretary.

I urge upon the Corporates and my professional col eagues to fol ow the

practices as enunciated in the Secretarial Standard on General Meetings in the

light of this Guidance Note issued by the ICSI so as to promulgate good

Corporate Governance.

Improvement is a continuous process and therefore, suggestions of the readers

to improve this publication are most welcome.

Place: New Delhi

CS Atul H Mehta

Date: 17.12.2015

President, ICSI

(vi i)

Secretarial Standards Board

(2015-2016)

Chairman

Pavan K. Vijay, Past President, ICSI

Member(s)

Anil Murarka, Past President, ICSI

Ahalada Rao V, Council Member, ICSI

Dipti Mehta (Ms.), Practising Company Secretary, Mumbai

Geetika Anand (Ms.), CS & Compliance Officer, Pantaloons Fashion & Retail Ltd.

Lalit Jain, former Senior Vice-President & Company Secretary, Jubilant Life

Sciences Ltd. and Practising Company Secretary, Delhi

Lalit Kumar, Partner, J. Sagar Associates

L. Jayaraman, Practising Company Secretary, Hyderabad

Milind B Kasodekar, Practising Company Secretary, Pune

Ranjeet Kumar Pandey, Council Member, ICSI

Ravichandran K S (Dr.), Practising Company Secretary, Coimbatore

Sanjay Grover, Practising Company Secretary, Delhi

Savithri Parekh (Ms.), Chief Legal & CS, Pidilite Industries Ltd.

S C Vasudeva, Practising Chartered Accountant, Delhi

S H Rajadhyaksha, Consultant, Tata Capital Financial Services Ltd.

S Chandrasekaran (Dr.), Practising Company Secretary, Delhi

Subhash C Setia, Company Secretary, DLF Limited

Subhasis Mitra, Group Company Secretary, CESC Ltd.

Representative Members

C D Srinivasan

Nominee, RBI

Girish Joshi

Nominee, BSE

G P Madaan

Nominee, ASSOCHAM

G. Sekar

Nominee, ICAI

Puneet Duggal

Nominee, MCA

Rajendra Singhi

Nominee, CI

V. R. Narasimhan (Dr.)

Nominee, NSE

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Secretarial Standards Board

(2014-2015)

Chairman

Pavan K. Vijay, Past President, ICSI

Member(s)

Anil Murarka, Past President, ICSI

Ahalada Rao V, Council Member, ICSI

Devendra Bhandari, Director, Stakeholders Empowerment Services

Jagannadha Rao C V, Company Secretary, KEC International Ltd.

Lakshmmi Subramanian, Practising Company Secretary, Chennai

Lalit Jain, former Sr. Vice-President & Company Secretary, Jubilant Life Sciences

Ltd. and Practising Company Secretary, Delhi

M S Sahoo, Former Secretary, ICSI & Member, Competition Commission of India

Milind B Kasodekar, Practising Company Secretary, Pune

Narayan Shankar, Company Secretary, Mahindra & Mahindra Limited

Ravichandran K S (Dr.), Practising Company Secretary, Coimbatore

Sanjay Grover, Practising Company Secretary, Delhi

Sanjiv Agarwal (Dr.), Managing Partner, Agarwal Sanjiv & Co, Chartered

Accountants, Jaipur

Savithri Parekh (Ms.), Chief Legal & CS, Pidilite Industries Ltd.

S C Vasudeva, Practising Chartered Accountant, Delhi

S H Rajadhyaksha, Consultant, Tata Capital Financial Services Ltd.

Subhasis Mitra, Group Company Secretary, CESC Ltd.

Suresh Krishnan, Vice-President (Internal Audit) & CS, Cholamandalam MS

General Insurance Co. Ltd.

Representative Members

Amit Tandon

Nominee, SEBI

G P Madaan

Nominee, ASSOCHAM

Mukesh Singh Kushwah

Nominee, ICAI

Rajendra Chopra

Nominee, FICCI

Rajendra Singhi

Nominee, CI

V. R. Narasimhan (Dr.)

Nominee, NSE

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C O N T E N T S

Pg. No.

BACKGROUND

1

INTRODUCTION

3

APPLICABILTY OF SS-2

4

SCOPE OF THE GUIDANCE NOTE

6

DEFINITIONS

7

GUIDANCE ON THE PROVISIONS OF SS-2

10

1. Convening a Meeting

10

2. Frequency of Meetings

44

3. Quorum

48

4. Presence of Directors and Auditors

52

5. Chairman

56

6. Proxies

59

7. Voting

70

8. Conduct of e-voting

82

9. Conduct of Pol

89

10. Prohibition on Withdrawal of Resolutions

93

11. Rescinding of Resolutions

94

12. Modifications to Resolutions

94

13. Reading of Reports

95

14. Distribution of Gifts

96

15. Adjournment of Meetings

97

16. Passing of Resolution by postal ballot

101

17. Minutes

110

18. Preservation of Minutes and other Records

125

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Pg. No.

19. Report on Annual General Meeting

126

20. Disclosures

127

ANNEXURES

Annexure I

Specimen Attendance Slip

129

Annexure I

Specimen Notice of Annual General Meeting

130

Annexure I I

Specimen Notice of Extra-Ordinary General Meeting

138

Annexure IV

Specimen Notice of Annual General Meeting

143

(for Newspaper)

Annexure V

Specimen Notice of Postponed Annual General

145

Meeting

Annexure VI

Specimen Notice of Postponement of Annual General

146

Meeting (for Newspaper)

Annexure VI Specimen Notice by Requisitionists convening an

147

Extra-Ordinary General Meeting

Annexure VII Specimen Notice of an Extra-Ordinary General Meeting

148

cal ed on the Requisition of Members

Annexure IX Specimen Board Resolution for convening

150

Extra-Ordinary General Meeting on Requisition

Annexure X

Specimen of a Demand for Pol

151

Annexure XI Announcements by the Chairman of the Meeting in

152

connection with a Pol

Annexure XI Checklist for Pol

153

Annexure XI I Specimen Announcement on the Notice Board of the

155

Company of the Result of the Pol

Annexure XIV Items of Business which shall be passed only by

156

Postal Ballot

Annexure XV Specimen Report of Postal Ballot

157

Annexure XVI Specimen Minutes of Annual General Meeting

159

Annexure XVI Specimen Minutes of Extra-Ordinary General Meeting

166

Annexure XVII Specimen Minutes of Adjourned Annual

169

General Meeting

GLOSSARY

171

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GUIDANCE NOTE

ON

GENERAL MEETINGS

The “Secretarial Standard on General Meetings” (SS-2), formulated by the

Secretarial Standards Board (SSB) of the Institute of Company Secretaries of

India (ICSI) and issued by the Council of the ICSI, has been approved by the

Central Government. Adherence to SS-2 is mandatory in terms of sub-section

(10) of Section 118 of the Companies Act, 2013 (the Act).

The first version of SS-2 was applicable to al types of General Meetings, in respect

of which Notices were issued between 1st July, 2015 to 30th September, 2017.

The revised version of SS-2 applies to all types of General Meetings, in respect

of which Notices are issued on or after 1st October, 2017.

SS-2 prescribes a set of principles for convening and conducting General

Meetings and matters related thereto.

This Guidance Note sets out the explanations, procedures and practical aspects

in respect of the provisions contained in revised SS-2 (effective from 1st October,

2017) to facilitate compliance thereof by the stakeholders.

BACKGROUND

The Act mandates holding of Meetings at specified intervals and also

prescribes related rules for the same. Such mandate is in recognition of the

fact that Meetings play a vital role in the functioning and governance of a

company. The primary purpose of a Meeting is to ensure that a company

gives reasonable and fair opportunity to those entitled to participate in the

Meeting to take decisions as per the prescribed procedures. A company,

being an artificial person, can, in respect of matters to be decided at General

Meeting, take such decisions through its Members by way of Resolutions

passed at validly held Meetings. Meetings of Members are known as General

1

2

GUIDANCE NOTE ON GENERAL MEETINGS

Meetings and determining what constitutes such validly held Meeting is of

utmost importance.

General Meetings can be broadly categorised as fol ows :

(i) Annual General Meeting – Every company is required to hold, during

every Calendar Year, a Meeting of its Members cal ed the Annual General

Meeting. The importance of the Annual General Meeting arises out of

the nature of business transacted at this Meeting. Broadly there are two

types of business that are transacted at an Annual General Meeting –

Ordinary Business and Special Business. At an Annual General Meeting,

consideration of financial statements & consolidated financial statements,

reports of the Board of Directors and the auditors, declaration of dividend,

appointment of Directors in place of those retiring and approval or

ratification of appointment of the Auditors and fixing their remuneration

are Ordinary Business. Any other item of business is referred to as Special

Business and may also be transacted at an Annual General Meeting.

Annual General Meetings provide Members with an opportunity to

col ectively discuss the affairs of the company and to exercise their

ultimate control over the management of the company. If a company

defaults in any year in holding its Annual General Meeting, any Member

of the company has a statutory right to approach the National Company

Law Tribunal (Tribunal) to call or direct the company to call an Annual

General Meeting.

(i ) Extra-Ordinary General Meeting – A company may also hold any other

Meeting of its Members called an Extra-Ordinary General Meeting, as

and when required or at the requisition of the Members. An Extra-

Ordinary General Meeting is convened for transacting Special or Urgent

business that may arise in between two Annual General Meetings. Al

business transacted at an Extra-Ordinary General Meeting are cal ed

Special Business.

(i i) Meeting of a Class of Members – Such Meetings are held to transact

business by way of passing Resolutions which only bind the Members

of the concerned class. Only Members of that class can attend such

Meetings and speak as well as vote thereat, e.g. Meetings of holders

of preference shares. Such Meetings are required to be convened when

it is proposed to vary the rights of the holders of a particular class of

shares. Provisions which govern General Meetings are mutatis mutandis

applicable to such Meetings.

GUIDANCE NOTE ON GENERAL MEETINGS

3

(iv) Meetings of Debenture Holders, Creditors etc. –- Such Meetings are

held to transact business by way of passing Resolutions which bind

the debenture holders or creditors, as the case may be, of the company.

The debenture holders or creditors, as the case may be, can attend

such Meetings and speak as well as vote thereat. Provisions which

govern General Meetings are mutatis mutandis applicable to such

Meetings.

(v) Other Meetings – In addition to the abovementioned Meetings, a

company may also hold Meetings of its Members, debenture holders

or creditors under the directions of the Court or the Tribunal or any

other authority.

Members of a company can exercise their powers and can bind the company

when they act as a body at a validly convened and held Meeting. They should

act col ectively and not individually. A Member or shareholder, irrespective of

his shareholding, cannot bind a company by his individual act.

INTRODUCTION

The fundamental principles with respect to General Meetings are laid down in

the Act. SS-2 facilitates compliance with these principles by endeavoring to

provide further clarity where there is ambiguity or establishing benchmark

standards to harmonies prevalent diverse practices. Complying with SS-2

ensures robust procedures and systems which protect the interests of the

company and its stakeholders. Incidentally, it has been observed that the

quantum and propensity for litigations or risk thereof is directly proportional to

the degree of non adherence of proper procedures and the non-availability of

proper records, especial y in the case of smal and private companies. SS-2

aims to address such issues.

SS-2 requires the Company Secretary(ies) to over-see the vital process of

facilitating and recording the decision making process in a company besides

maintaining the integrity of the Meetings. Where there is no Company Secretary

in the company or in absence of the Company Secretary, any Director or other

Key Managerial Personnel (KMP) or any other officer of the Company authorised

by the Board for this purpose may discharge such of the functions of the

Company Secretary as given in SS-2.

SS-2 does not seek to substitute or supplant any existing laws. It strives to

supplement such laws for promoting better corporate governance.

Therefore, in addition to SS-2, the requirements laid down under any other

4

GUIDANCE NOTE ON GENERAL MEETINGS

applicable laws, rules and regulations, need to be complied with. However, in

case of variations in any provision of the applicable laws and SS-2, the stricter

provisions need to be complied with.

APPLICABILITY OF SS-2

In terms of sub-section (10) of Section 118 of the Act, every company is required

to observe SS-2.

SS-2 is thus applicable to General Meetings of all companies incorporated

under the Act including private and small companies, except One Person

Companies (OPC) and companies licensed under Section 8 of the Companies

Act, 2013 or corresponding provisions of any previous enactment thereof.

MCA Notification No. G.S.R. 466(E) dated 5th June, 2015 exempts companies

licensed under Section 8 of the Companies Act, 2013 from the applicability of

Section 118 of the Act as a whole except that Minutes of Meetings of such a

company may be recorded within thirty days of the conclusion of every Meeting

in case of companies where the Articles of Association provide for confirmation

of Minutes by circulation. Consequently, SS-2 is not applicable to companies

licensed under Section 8 of the Companies Act, 2013 or corresponding provisions

of any previous enactment thereof. Such companies may voluntarily comply

with SS-2. However, Section 8 companies need to comply with the applicable

provisions of the Act relating to General Meetings.

Further, MCA vide its Notifications No. G.S.R. 584(E) dated 13th June, 2017 modified

the above cited Notification dated 5th June, 2015 to place a restriction that such

exemptions shal be applicable to a Section 8 company which have not

committed a default in filing its Financial Statements or Annual Return with the

Registrar of Companies.

In addition, by virtue of MCA Exemption Notifications No. G.S.R. 08(E) & G.S.R.

9(E), dated 4th January, 2017, fol owing class of companies are exempted from

the applicability of Section 118(10) of Companies Act, 2013 i.e. the compliance

of Secretarial Standards:

• Specified IFSC public company: An unlisted public company which is

licensed to operate by the Reserve Bank of India or the Securities and

Exchange Board of India or the Insurance Regulatory and Development

Authority of India from the International Financial Services Centre located

in an approved multi services Special Economic Zone set-up under the

Special Economic Zones Act, 2005 read with the Special Economic

Zones Rules, 2006.

GUIDANCE NOTE ON GENERAL MEETINGS

5

• Specified IFSC private company: A private company which is licensed

to operate by the Reserve Bank of India or the Securities and Exchange

Board of India or the Insurance Regulatory and Development Authority

of India from the International Financial Services Centre located in an

approved multi services Special Economic Zone set-up under the Special

Economic Zones Act, 2005 read with the Special Economic Zones Rules,

2006.

Applicability to companies governed under Special Acts

SS-2 is also applicable to Banking companies, Insurance companies, companies

engaged in generation or supply of electricity, companies governed by any

special Acts, if incorporated under the Act. However, if the provisions of these

special Acts such as the Banking Regulation Act, 1949, the Insurance Act, 1938,

etc. applicable to these companies are inconsistent with SS-2, then the provisions

of such special Acts shal prevail.

Applicability to the Meetings of class of Members, debenture holders

and creditors

The principles enunciated in SS-2 for General Meetings of Members are

applicable mutatis mutandis to Meetings of class of Members, debenture

holders and creditors.

A Meeting of Members or class of Members or debenture holders or creditors

of a company under the directions of the Court, Tribunal or any other prescribed

authority shal be governed by SS-2 without prejudice to any rules, regulations

and directions prescribed for and orders of, such Courts, Tribunals and other

authorities with respect to the conduct of such Meetings.

Effect of subsequent changes in the Act

SS-2 is in conformity with the provisions of the Act. However, if due to subsequent

changes in the Act, a particular Standard or any part thereof becomes

inconsistent with the Act, the provisions of the Act shal prevail over the Secretarial

Standards. Moreover, if any stipulation contained in SS-2 is derived from any

provision of law and if such provision is declared inapplicable to any class of

companies, such stipulation shal not apply to such class of companies.

The Ministry of Corporate Affairs (MCA), Government of India, in exercise of its

powers conferred by clauses (a) and (b) of sub–section (1) of Section 462 and in

pursuance to sub-section (2) of the said section of the Act, vide Notifications

No. G.S.R. 463(E), G.S.R. 464(E), G.S.R. 465(E) and G.S.R. 466(E) [(hereinafter

6

GUIDANCE NOTE ON GENERAL MEETINGS

referred to as MCA Notification(s)] dated 5th June, 2015, directed that certain

provisions of the Act shall not apply or shall apply with such exceptions,

modifications and adaptations as specified in the MCA Notification(s) to

Government Companies, Private companies, Nidhis and companies

incorporated under Section 8 of the Companies Act, 2013 respectively.

Further, MCA vide its Notification(s) dated 13th June, 2017 modified the above

cited Notification(s) dated 5th June, 2015 issued in respect of Government

Companies, Private Companies, and Section 8 Companies to place a restriction

that such exemptions shall be applicable to those companies which have not

committed a default in filing its Financial Statements or Annual Return with the

Registrar of Companies.

As stated earlier, by virtue of MCA Exemption Notifications No. G.S.R. 8(E) &

G.S.R. 9(E), dated 4th January, 2017, Specified IFSC public company and Specified

IFSC private company are also exempted from the applicability of Section 118(10)

of Companies Act, 2013 i.e. the compliance of Secretarial Standards.

Accordingly, if due to the MCA Notification(s) referred to herein above or

Notifications that may be issued in future, the provisions of the Standards or

any part thereof become inconsistent with any of the provisions of the Act, such

corresponding provisions of the Act read with the MCA Notification(s) shal

prevail.

SCOPE OF THE GUIDANCE NOTE

This Guidance Note should be read in the context of SS-2.

It elucidates, wherever necessary, the basis for setting a particular Standard,

explains the procedural and practical aspects and contains il ustrations. It also

integrates the replies to various queries raised by the stakeholders on the

particular Standard after the issuance of SS-2.

In this Guidance Note:

• Paragraph numbers (including sub-paragraph numbers and their

further sub-divisions) refer to the corresponding paragraphs under

SS-2.

• Extracts from the SS-2 have been set in Bold and Normal font type as

appearing in the SS-2 respectively.

• The Guidance text and analysis is set in italics.

GUIDANCE NOTE ON GENERAL MEETINGS

7

This Guidance Note is prepared on the basis of the relevant provisions of the

Act as amended up to 31st August, 2017 and the rules, circulars, clarifications

etc. issued by the MCA until 31st August, 2017.

In this Guidance Note, the applicable provision of SEBI (Listing Obligations

and Disclosure Requirements) Regulations, 2015 are given in special (three

layers) boxes at the respective places. These do not form part of the

Secretarial Standard and included herein for the purpose of Guidance only.

DEFINITIONS

The fol owing terms are used in this Guidance Note with the meaning specified:

“Act” means the Companies Act, 2013 (Act No. 18 of 2013) or any previous

enactment thereof, or any statutory modification thereto or re-enactment thereof

and includes any Rules and Regulations framed thereunder.

“Agency” means agency approved or recognised by the Ministry of Corporate

Affairs and appointed by the Board for providing and supervising electronic

platform for voting.

“Articles” means the Articles of Association of a company, as originally framed

or as altered from time to time, or applied in pursuance of any previous

company law or the Companies Act, 2013.

“Calendar Year” means calendar year as per Gregorian calendar i.e. a period

of one year which begins on 1st January and ends on 31st December.

“Chairman” means the Chairman of the Board or the Chairman appointed or

elected for a Meeting.

“Maintenance” means keeping registers and records either in physical or

electronic form, as may be permitted under any law for the time being in force,

and includes the making of necessary entries therein, the authentication of

such entries and the preservation of such physical or electronic records.

“Meeting” or “General Meeting” or “Annual General Meeting” or “Extra-Ordinary

General Meeting” means a duly convened, held and conducted Meeting of

Members.

“Minutes” means a formal written record, in physical or electronic form, of the

proceedings of a Meeting.

“Minutes Book” means a Book maintained in physical or in electronic form for

the purpose of recording of Minutes.

8

GUIDANCE NOTE ON GENERAL MEETINGS

“National Holiday” means Republic Day i.e. 26th January, Independence Day

i.e. 15th August, Gandhi Jayanti i.e. 2nd October and such other day as may be

declared as National Holiday by the Central Government.

“Ordinary Business” means business to be transacted at an Annual General

Meeting relating to (i) the consideration of financial statements, consolidated

financial statements, if any, and the reports of the Board of Directors and Auditors;

(i ) the declaration of any dividend; (i i) the appointment of Directors in the place

of those retiring; and (iv) the appointment or ratification thereof and fixing of

remuneration of the Auditors.

Note: Annual Ratification is contemplated in law for ‘continuation of appointment’

of Auditors under Section 139(1) of the Act read with Rule 3(7) of the Companies

(Audit and Auditors) Rules, 2014. It falls within the scope of ‘appointment’ and

hence is an item of ‘ordinary business’ to be transacted at the Annual General

Meeting.

‘Ratification of appointment of auditor’ is therefore logical y included in the

definition of the term ‘ordinary business’ herein.

“Proxy” means an instrument in writing signed by a Member, authorising another

person, whether a Member or not, to attend and vote on his behalf at a Meeting

and also where the context so requires, the person so appointed by a Member.

“Quorum” means the minimum number of Members whose presence is

necessary for holding of a Meeting.

“Remote e-voting” means the facility of casting votes by a member using an

electronic voting system from a place other than venue of a general Meeting.

“Secretarial Auditor” means a Company Secretary in Practice or a firm of

Company Secretary(ies) in Practice appointed in pursuance of the Act to conduct

the secretarial audit of the company.

“Secured Computer System” means computer hardware, software, and

procedure that –

(a) are reasonably secure from unauthorised access and misuse;

(b) provide a reasonable level of reliability and correct operation;

(c) are reasonably suited to performing the intended functions; and

(d) adhere to generally accepted security procedures.

“Special Business” means business other than the Ordinary Business to be

GUIDANCE NOTE ON GENERAL MEETINGS

9

transacted at an Annual General Meeting and all business to be transacted at

any other General Meeting.

“Timestamp” means the current time of an event that is recorded by a Secured

Computer System and is used to describe the time that is printed to a file or

other location to help keep track of when data is added, removed, sent or

received.

“Voting by electronic means”, includes ‘remote e-voting’ and voting at the

general Meeting through an electronic voting system which may be the same

as used for remote e-voting.

“Voting by postal bal ot” means voting by bal ot, by post or by electronic means.

“Voting Right” means the right of a Member to vote on any matter at a Meeting

of Members or by means of e-voting or postal or physical ballot.

“Equity Listed Company” means a company which has any of its specified

securities i.e. equity shares and convertible securities listed on any

recognised stock exchange.

“Listing Regulations” means the SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015, including any amendment thereto or

modification thereof.

Words and expressions used and not defined herein shal have the same

meaning respectively assigned to them under the Act and / or the Listing

Regulations, as may be applicable.

References herein to Sections, Regulations and Listing Regulations relate

respectively to Sections of the Act, Regulations of Table F of Schedule I to the Act

and Listing Regulations, unless stated otherwise.

Words imparting the singular include the plural and words imparting any gender

include every gender.

Meanings of some of the terms used in this Guidance Note are placed at the

end of this Guidance Note under the heading “Glossary”.

10

GUIDANCE NOTE ON GENERAL MEETINGS

GUIDANCE ON THE PROVISIONS OF SS-2

1. Convening a Meeting

1.1 Authority

A General Meeting shal be convened by or on the authority of the Board.

The authority to convene a General Meeting of the company is with the Board.

A Director, Company Secretary, Manager or any other officer of the company

may be authorised by the Board to convene a General Meeting.

A Director, Company Secretary, Manager or any other officer of the company

shall not have the power to convene a General Meeting on his own.

In order to be a valid Meeting, the Notice of the Meeting should be given by a

person duly authorised by the Board.

It may be noted that this proposition holds good as the approval of the Board

is necessary for the issuance of the Notice including - the items of business

to be transacted, text of Resolutions and explanatory statement contained in

the Notice.

Necessity of properly constituted Board for cal ing a General Meeting

Unless the minimum number of Directors prescribed by the Act or the Articles,

as the case may be, has been appointed, the Board is not considered to be

ful y constituted.

If a Board, not properly constituted in accordance with law, convenes a Meeting,

such Meeting shal be irregular and the Resolutions passed thereat shall be

invalid.

The continuing Directors may act notwithstanding any vacancy in the Board;

but, if and so long as their number is reduced below the quorum fixed by the

Act for a meeting of the Board, the continuing Directors or Director may act for

the purpose of increasing the number of Directors to that fixed for the quorum,

or of summoning a general meeting of the company, but for no other purpose

[Regulation 69 of Table F of Schedule I to the Act].

The Board shal , every year, convene or authorise convening of a Meeting of its

Members called the Annual General Meeting to transact items of Ordinary

Business specifically required to be transacted at an Annual General Meeting

as well as Special Business, if any. If the Board fails to convene its Annual

General Meeting in any year, any Member of the company may approach the

GUIDANCE NOTE ON GENERAL MEETINGS

11

prescribed authority, which may then direct the calling of the Annual General

Meeting of the company.

Section 96 of the Act requires that the Annual General Meeting should be held

in each year. The term “Year” is not defined in the Act. Thus, the definition has

to be construed as per the General Clauses Act, 1897. Accordingly, the ‘Year’

should be considered as Calendar Year.

In case of any default in holding the Annual General Meeting in any year, any

Member of the company may approach the Tribunal for suitable directions.

The Board may also, whenever it deems fit, cal an Extra-Ordinary General

Meeting of the company.

Every General Meeting other than an Annual General Meeting shall be cal ed

an Extra-Ordinary General Meeting.

If at any time the number of Directors required to form a Quorum are not within

India, any Director or any two Members of the company may cal an Extra-

Ordinary General Meeting in the same manner, as nearly as possible, as that

in which such a Meeting may be called by the Board [Regulation 43(i ) of Table

F of Schedule I to the Act].

The Board shall, on the requisition of Members who hold, as on the date of the

receipt of a valid requisition,

(a) in the case of company having a share capital, not less than one-tenth

of the paid-up share capital carrying Voting Rights or

(b) in the case of a company not having share capital, not less than one-

tenth of total voting power of the company,

call an Extra-Ordinary General Meeting of the company.

This applies only with respect to cal ing an Extra-ordinary General Meeting.

It may be noted that the phrase ‘one-tenth of the paid-up share capital’, implies

that the total amount paid-up on shares held by requisitionists should not be

less than one-tenth of the total amount paid-up on al the shares of the company

which carry the right to vote.

A single shareholder may also file the requisition for convening the Meeting

provided that he has the requisite voting rights or voting power as per Section

100 of the Act.

As the reference in Section 100 of the Act is to shares which carry voting rights,

12

GUIDANCE NOTE ON GENERAL MEETINGS

holders of preference shares cannot join in requisitioning an Extra-Ordinary

General Meeting, except for those matters in respect of which they are entitled

to vote.

Section 100 does not distinguish between a requisitionist being a natural or an

artificial person. Therefore, an artificial person may also submit the requisition

with the company. Thus, in case a body corporate is a Member of another

company, it can file the requisition for convening a Meeting if it holds the

required voting rights or voting power.

Every Member of a company has a right to requisition an Extra-Ordinary General

Meeting in accordance with the provisions of the Act. He cannot be restrained

from requisitioning an Extra-Ordinary General Meeting and he is not bound to

disclose the reasons for the Resolutions proposed to be moved at the Meeting

[Life Insurance Corporation of India v. Escorts Ltd. and Others (1986) 59 Comp.

Cas. 548 (SC)].

The requisition to call an Extra-Ordinary General Meeting should be in writing

or through electronic means [Rule 17(1) of the Companies (Management and

Administration) Rules, 2014].

The Board cannot reject a requisition as invalid, except when the requisitionists

do not fulfil the eligibility criteria stipulated under Section 100 of the Act.

However, it has been held that the Board is within its rights to refuse to call and

hold an Extra-Ordinary General Meeting on the requisition of Members where

an order of injunction restraining the company from holding any Meeting is in

force [A.D. Chaudhary v. Mysore Paper Mil s Ltd. (1976) 46 Comp. Cas. 639

(Kar)].

If, on receipt of a valid requisition having been made in this behalf, the Board,

within twenty-one days from the date of such receipt, fails to call a Meeting on

any day within forty-five days from the date of receipt of such requisition, the

requisitionists may themselves cal and hold the Meeting within three months

from the date of requisition, in the same manner in which the Board should

have cal ed and held the Meeting.

The Board should, within twenty-one days from the date of receipt of a valid

requisition, call a Meeting on any day within forty-five days from the date of

receipt of such requisition. In case the Board fails to call the General Meeting

requisitioned by the Members, it can be called and convened by the

requisitionists.

GUIDANCE NOTE ON GENERAL MEETINGS

13

Rule 17(7) of the Companies (Management and Administration) Rules, 2014

provides that if the Meeting is not convened, the requistionists shal have a

right to receive list of members together with their registered address and

number of shares held and the company concerned is bound to give a list of

members together with their registered address made as on twenty first day

from the date of receipt of valid requisition together with such changes, if any,

before the expiry of the forty-five days from the date of receipt of a valid

requisition.

Where the Board has failed to convene the requisitioned Extra-Ordinary General

Meeting and the requisitionists convene the Meeting, then it becomes the duty

of the Board to provide the requisitionists with all the relevant information viz.

registered email addresses of members, number of shares held by them etc.

from the Register of Members.

Explanatory statement need not be annexed to the Notice of an Extra-Ordinary

General Meeting convened by the requisitionists and the requisitionists may

disclose the reasons for the Resolution(s) which they propose to move at the

Meeting.

There is, however, no bar on the addition of an Explanatory Note by the Board

in order to elucidate its position, in any manner, with respect to the proposals

contained in the requisition.

Such requisition shall not pertain to any item of business that is required to be

transacted mandatorily through postal bal ot.

1.2 Notice

1.2.1 Notice in writing of every Meeting shal be given to every

Member of the company. Such Notice shal also be given to

the Directors and Auditors of the company, to the Secretarial

Auditor, to Debenture Trustees, if any, and, wherever

applicable or so required, to other specified persons.

Notice for convening the Meeting should be given in writing to every person

entitled to such Notice.

Form of Notice

The Notice should be in writing, though no form has been prescribed for this

purpose. Oral intimation that it is proposed to have a general meeting is not a

Notice at al and consequently if any Meeting is held, it wil be invalid.

14

GUIDANCE NOTE ON GENERAL MEETINGS

Persons entitled to Notice

In terms of sub-section (3) of Section 101 of the Act, Notice of every Meeting of

the company should be given to –

(a) every Member of the company, legal representative of any deceased

Member or the assignee of an insolvent Member.

For the purpose of this Clause, ‘Member’ would include persons whose

shares have been transferred to the Investor Education and Protection

Fund of the Central Government or held by the company under the

‘Unclaimed Suspense Account’

(b) the Auditor or Auditors of the company; and

(c) every Director of the company.

In terms of sub-section (55) of Section 2 of the Act, Member includes the holder

of both equity and preference shares whose name is entered as a beneficial

owner in the records of a depository. Accordingly, holders of equity shares as

well as holders of preference shares are entitled to receive Notices of General

Meetings and to attend the Meetings. Further, Section 101 of the Act does not

qualify the term “Member” by a restrictive expression “entitled to vote”.

Accordingly, preference shareholders are entitled to receive Notices of, and to

attend, General Meetings, even if they are not entitled to participate in the

discussion or vote on any Resolution placed before the Meeting.

Further, the term Director includes all types of Directors in the company at the

time of dispatching of Notices i.e. Whole Time Director, Independent Director,

Nominee Director, Additional Director, Alternate Director, Woman Director etc.

In addition to the above, this paragraph of SS-2 requires Notice to be given to

the fol owing:

(i) Secretarial Auditor

In terms of paragraph 4.3 of SS-2, the Secretarial Auditor or his

authorised representative is required to attend the AGM. In case of

other General Meetings, Explanation to paragraph 4.3 states that the

Chairman may invite the Secretarial Auditor or his authorised

representative to attend, if he considers it necessary.

Notice of the General Meetings should therefore be sent to the

Secretarial Auditors, as an invitation to attend or for information, as the

case may be.

GUIDANCE NOTE ON GENERAL MEETINGS

15

(i ) Debenture Trustees

Debenture Trustees have a fiduciary responsibility towards the debenture

holders and in order to protect the interest of such debenture holders, the

Debenture Trustees should be made aware about the developments in the

company, by serving to them the Notice of the General Meeting, Notice of

postal ballot and their accompanying documents.

The expression “Auditors” used in this paragraph of SS-2 includes auditors

appointed for conducting cost audit pursuant to Section 148 of the Act.

It is also advisable to give notice to the Auditor(s) whose appointment is

proposed at the General Meeting.

In case of buyback/delisting etc., the Notice of General Meeting should also be

served on such shareholders who have offered their shares to the company

and whose shares are in escrow account, til the same is accepted by the

company.

The other recipients of the Notice may include-

(i) in the case of a Listed Company, the stock exchanges on which the

shares or other securities of the company are listed;

(i ) financial institutions, pursuant to a covenant in the agreement entered

into with them for availing financial assistance;

(i i) foreign col aborator(s), if the agreement with them provides for sending

of such Notices;

(iv) In case shares of the company are held in dematerialised form, NSDL

and CDSL, and in case the company has issued GDRs / ADRs / FCCBs,

then to such Depository(ies).

(v) holders of Stock Options of the company; and

(vi) any other recipient to whom the company has agreed to give Notice

(say, as per the terms of an agreement with any party).

In addition, a Court may direct issuance of Notice to some other persons such

as Court-appointed Chairman or observers. In such case the Notice should be

given accordingly.

In the case of Members, Notice shall be given at the address registered with

the company or depository. In the case of shares or other securities held jointly

by two or more persons, the Notice shall be given to the person whose name

16

GUIDANCE NOTE ON GENERAL MEETINGS

appears first as per records of the company or the depository, as the case may

be. In the case of any other person who is entitled to receive Notice, the same

shall be given to such person at the address provided by him.

Notice to Member which is a body corporate

Sub–section (1) of Section 20 of the Act provides that a document may be

served on a company at its Registered Office. Thus, Notice to a Member, which

is a body corporate should be given at its Registered Office.

Notice to representatives and assignees

Where the company has received intimation of death of a Member, the Notice

of Meeting shall be sent as under:

(a) where securities are held singly, to the Nominee of the single holder;

(b) where securities are held by more than one person jointly and any

joint holder dies, to the surviving first joint holder;

(c) where securities are held by more than one person jointly and all the

joint holders die, to the Nominee appointed by al the joint holders.

In the absence of a Nominee, the Notice shal be sent to the legal representative

of the deceased Member.

Shares of a deceased shareholder come under the authority of the legal

representative. When the name of the person to whom shares of the deceased

shareholder are transmitted gets entered in the Register of Members, the

membership of the deceased shareholder stands terminated.

Where the joint shareholders have not appointed a nominee and where the

legal representatives of each of the joint shareholders are different, the notice

is to be forwarded to the legal representative of the first named shareholder.

In case of insolvency of a Member, the Notice shal be sent to the assignee of

the insolvent Member.

In case the Member is a company or body corporate which is being wound up,

notice shal be sent to the liquidator.

Notice when Meeting is adjourned

When the Meeting is adjourned for thirty days or more, fresh Notice of the

adjourned Meeting should be given in the manner specified. (This matter is

discussed at length under the heading “Adjournment of Meetings”).

GUIDANCE NOTE ON GENERAL MEETINGS

17

Irregular Notice

Some instances of irregular Notice are as under:

(1) When the Notice of General Meeting is issued without authorisation by

the Board.

(2) When the Notice is issued by an invalidly constituted Board.

(3) When the appointment of a Director who has signed the Notice is void

and the Notice gets issued even after discovery of invalidity.

(4) When the Notice is not in accordance with the Act.

A Meeting called and held without adequate Notice and Resolutions passed at

such Meetings wil be invalid [Parmeshwari Prasad Gupta v. the Union of India

1973 AIR 2389].

In situations where the company is unable to send Notice to a Member whose

registered address is situated in enemy territory, on grounds of force majeure,

there is no violation of the requirement relating to Notice. Further, if the right of

some Members to receive Notice is suspended by operation of law, the

company can carry on its business without serving Notice on such Members

[Re. Anglo International Bank (1943) Ch. 233 CA; (1943) 2 Al ER 88].

Great care should be taken to ensure that notice of the Meeting is served on all

the persons entitled to receive it. If non-receipt of Notice by persons entitled to

receive such notice is proved and the same is due to some default of the

company, the proceedings of such General Meeting may be held invalid.

Chal enge to the validity of a Notice

Those who seek to chal enge the validity of a Notice should act promptly.

Effect of MCA Notification - Nidhi Companies

In case of a Nidhi, Notice may be served individual y only on Members who

hold shares of more than one thousand rupees in face value or more than one

percent of the total paid-up share capital of the company, whichever is less. For

other Members, Notice may be served by a public notice in newspaper

circulated in the district where the Registered Office of the company is situated

and by displaying the same on the Notice Board of the company.

The Central Government has exempted Nidhi companies from sending

individual Notices to members holding shares of less than one thousand rupees

of face value or less than one percent of the total paid up share capital of the

company. (In line with MCA Notification No. G.S.R. 465(E) dated June 5, 2015)

18

GUIDANCE NOTE ON GENERAL MEETINGS

Regulation 29(1)(d) of Listing Regulations: Prior Intimation

Equity Listed Company should give prior intimation to stock exchange(s)

about the General Meetings proposed to be held for obtaining shareholder

approval for further fund raising indicating the type of issuance.

Intimation may be given immediately after Board’s approval for convening

of General Meeting.

Equity Listed Company should also send a copy of the Notice of General

Meeting to stock exchange(s) as soon as possible and not later than 24

hours of despatch of the said Notice to the shareholders. (In line with

Schedule I I (Part A) of Listing Regulations).

1.2.2 Notice shal be sent by hand or by ordinary post or by speed

post or by registered post or by courier or by facsimile or by

e-mail or by any other electronic means. ‘Electronic means’

means any communication sent by a company through its

authorised and secured computer programme which is capable

of producing confirmation and keeping record of such

communication addressed to the person entitled to receive

such communication at the last electronic mail address provided

by the Member.

Mode of Issuing Notice

Notice may be served by various modes, such as hand delivery, post, facsimile,

e-mail or any other electronic means. Notice may even be sent through courier.

However, if the Articles of the company prescribe the mode by which Notice

has to be given, it should be given accordingly. Similarly, if any agreement to

which the company is a party requires the company to deliver the Notice to

any person including Joint Venture Partner/Investor in a specific manner, it

should be given accordingly.

Notice may be sent through e-mail as a text or as an attachment to an email or

as a notification providing electronic link or Uniform Resource Locator (URL) for

accessing such notice.

Further, where Notice is sent through e-mail, the subject line in such e-mail

should state the name of the company, Notice of the type of Meeting, place

and the date on which the Meeting is scheduled [Rule 18(3)(i ) of the Companies

(Management and Administration) Rules, 2014].

GUIDANCE NOTE ON GENERAL MEETINGS

19

If Notice is sent in the form of a non-editable attachment to e-mail, such

attachment should be in the Portable Document Format (PDF) or in a non-

editable format together with a ‘link or instructions’ for recipient for downloading

relevant version of the software [Rule 18(3)(i i) of the Companies (Management

and Administration) Rules, 2014].

The company shall ensure that it uses a system which produces confirmation

of the total number of recipients e-mailed and a record of each recipient to

whom the Notice has been sent and copy of such record and any Notices of

any failed transmissions and subsequent re-sending shal be retained by or on

behalf of the company as ‘ proof of sending’’ for such period as decided by the

Board, which shal not be less than three years from the date of the Meeting.

In cases where the Notice is sent by e-mail or any other electronic means, the

proof of sending of the Notice is required to be maintained by the company.

Proof of sending of the Notice should be preserved for such period, as decided

by the Board, which should not be less than three years from the date of the

Meeting. In case any legal proceedings in connection with the same are

pending, this proof should be maintained til complete disposal of the

proceedings, including accounting for limitation period for any appeals. The

proof may be maintained in soft form.

Notice shall be sent to Members by registered post or speed post or courier or

e-mail and not by ordinary post in the fol owing cases:

(a) if the company provides the facility of e-voting;

(b) if the item of business is being transacted through postal ballot.

If a Member requests for delivery of Notice through a particular mode, other

than the one fol owed by the company, he shall pay such fees as may be

determined by the company in its Annual General Meeting and the Notice

shall be sent to him in such mode.

Where a Member indicates to the company in advance that Notice shall be

sent to him through a particular mode other than the one fol owed by the

company, service of Notice would not be deemed to be effected unless the

company serves the Notice in the manner specified by the Member. However,

the Member should pay such fee for the particular mode of delivery of notice,

as may be determined by the company in its Annual General Meeting. In case

no such fee is determined, notice should be sent free of cost through the mode

requested by the member.

20

GUIDANCE NOTE ON GENERAL MEETINGS

Notice shall be sent to Members by registered post or speed post or e-mail if

the Meeting is called by the requisitionists themselves and where the Board

had not proceeded to call the Meeting.

In terms of sub-rule (8) of Rule 17 of the Companies (Management and

Administration) Rules, 2014, the Notice of the Meeting called by requisitionists

should be given by speed post or registered post or through electronic

means.

Addresses for sending Notice by electronic means

In case the Notice and accompanying documents are given by e-mail, these

shall be sent at the Members’ e-mail addresses, registered with the company

or provided by the depository, in the manner prescribed under the Act.

A company is required to provide an advance opportunity at least once in a

financial year, to the Member to register his email address or to update a fresh

email id with the company or get such details updated with the depository

[Rule 18(3)(i) of the Companies (Management and Administration) Rules, 2014].

Notice of the General Meeting should contain a Note in this regard.

If a Member does not provide an updated e-mail address, the company shal

not be in default for non-receipt of such Notice by the Member.

In case of the Directors, Auditors, Secretarial Auditors and others, if any, the

Notice and accompanying documents shall be sent at the e-mail addresses

provided by them to the company, if being sent by electronic means.

1.2.3 In case of companies having a website, the Notice shal

simultaneously be hosted on the website til the conclusion of

the Meeting.

The Notice of the General Meeting of the company should be simultaneously

placed on the website, if any, of the company and on the website as may be

notified by the Central Government [Rule 18(3)(ix) of the Companies

(Management and Administration) Rules, 2014].

Thus, if the company has a website, Notice is required to be hosted on the

website til the conclusion of the Meeting.

Effect of MCA Notification

In case of a private company, the Notice shall be hosted on the website of the

company, if any, unless otherwise provided in the Articles.

GUIDANCE NOTE ON GENERAL MEETINGS

21

1.2.4 Notice shal specify the day, date, time and full address of

the venue of the Meeting.

Notice of Annual General Meeting shal also specify the serial number of the

Meeting.

Day/date and Time

The Notice should state explicitly the day, date, time and venue of the Meeting.

In the absence of any of these particulars, the Meeting would be invalid. In a

Notice where the day of the Meeting is incorrectly stated, i.e. where the day of

the week does not match the date and month given, that Notice is bad in law.

An Annual General Meeting and a Meeting cal ed by the requisitionists shal

be cal ed during business hours, i.e., between 9 a.m. and 6 p.m., on a day that

is not a National Holiday.

An Annual General Meeting and a Meeting called by the requisitionists can be

held on any day, including a public holiday or on a Sunday, unless such day is

a National Holiday.

Sub-section (2) of Section 96 of the Act requires the Annual General Meetings

to be held during business hours on a day that is not a National Holiday.

Explanation to Rule 17(2) of Companies (Management and Administration) Rules,

2014 prescribes that a Meeting cal ed by the requisitionists should be convened

on any day except National Holiday.

Every Notice of a Meeting should state a specific time at which the Meeting is

to commence, for example, 11:00 a.m.

Where the Notice of a General Meeting did not specify the hour of the Meeting,

the Notice was invalid and any Resolution passed at such Meeting was also

invalid [Prachi Insurance Co. Ltd. v. Chaudhary Madhusudan Das, (1964) 2

Comp L J 157 (Orissa)].

The time mentioned in the Notice is the time for commencement of the Meeting.

MCA has clarified that ‘time’ indicates only the hour of commencement of the

Meeting [Letter of the then Department of Company Affairs, No.8/16(1)/61-PR

dated 9-5-1961].

The company should start its Meeting during the business hours but it is not

necessary that the Meeting ends within the business hours; the Meeting may

end even after the business hours.

22

GUIDANCE NOTE ON GENERAL MEETINGS

Place

Notice shall contain complete particulars of the venue of the Meeting including

route map and prominent land mark, if any, for easy location, except in case of:

(i) a company in which only its directors and their relatives are members;

(i ) a whol y owned subsidiary.

Every Notice of a Meeting should specify the place of the Meeting. The expression

‘place’ means the exact location or ful postal address where the Meeting is to

be held, so as to enable a person to locate the venue of the Meeting without

any difficulty.

The company cannot fix a place for a Meeting which is prohibited by the Articles

of the company [Re: Aidqua Holdings (Mauritius) Inc v. Tamil Nadu Water

Investment Co. Limited (2008) 142 Comp. Cas. 497: (2008) 83 SCL 434 (CLB)].

Giving the route-map and prominent landmark in the Notice is a good practice

benefitting the Members. Though e-voting is mandatory in case of certain

companies, many Members may stil prefer to attend the Meeting physical y.

Most of the times, it is observed that there is no fixed venue for General Meetings.

The registered office of companies is also sometimes located in remote areas.

Providing a route map and prominent landmark would enable easy location of

the venue by those who wish to attend the Meeting. The objective is to ensure

that they are able to reach the venue at the appointed time without much dif iculty.

Since the spirit of the Standard is to enable easy location, the route-map and

prominent landmark is not requiredin case of a whol y owned subsidiary or in

case of a company where only its directors and their relatives are members of

the company. However, such companies would need to disclose complete

particulars of the venue of the Meeting in the Notice.

If the venue of the Meeting is not at an easy location, then in all cases the

route-map and prominent landmark should be provided for the convenience of

members.

Il ustration

Mr. X, Ms. Y (wife of Mr. X) and Mr. C (son of X & Y) are the Directors of

XYZ Ltd. They are also the Members of XYZ Ltd. alongwith 4 other persons

who are brothers and sisters of Mr. X. XYZ Ltd. proposes to hold the

General Meeting at the residence of Mr. X.

GUIDANCE NOTE ON GENERAL MEETINGS

23

In this case, since only the directors and their relatives are members of the

company and the residence of Mr. X is generally known to all Members of

XYZ Ltd. and can be easily located, the route-map and prominent landmark

is not required to be provided in the Notice.

Annual General Meetings shall be held either at the registered office of the

company or at some other place within the city, town or vil age in which the

registered office of the company is situated, whereas other General Meetings

may be held at any place within India. A Meeting cal ed by the requisitionists shal

be held either at the registered office of the company or at some other place within

the city, town or vil age in which the registered office of the company is situated.

Annual General Meeting can be held at any place within the postal limits or

local limits of the city, town or vil age in which the Registered Office of the

company is situated and where these two limits do not coincide, within the

wider of the two limits [Circular of the then Department of Company Affairs -

No. 1/1/80-CL-V, dated 16 February, 1981].

Explanation to Rule 18 of the Companies (Management and Administration)

Rules, 2014 prescribes that the Extra-Ordinary General Meeting should be held

at a place within India. Thus, an Extra-Ordinary General Meeting should be

held only in India though not necessarily within the city, town or vil age in

which the Registered Office of the company is situated.

Notice of a company which has a share capital or the Articles of which provide

for voting at a Meeting by Proxy, shal prominently contain a statement that a

Member entitled to attend and vote is entitled to appoint a Proxy, or where that

is allowed, one or more proxies, to attend and vote instead of himself and that

a Proxy need not be a Member.

Where a Member cannot attend the Meeting in person, he is entitled to appoint

a Proxy to attend on his behalf. Every Notice calling a Meeting should state that

any Member entitled to attend and vote is entitled to appoint another person as

a Proxy [Sub-section (1) of Section 105 of the Act].

Effect of MCA Notification

In case of a Government company, the Annual General Meeting shall be held

at its registered office or any other place with the approval of the Central

Government, as may be required in this behalf. [In line with MCA Notification

No. G.S.R. 463(E) dated June 5, 2015.]

24

GUIDANCE NOTE ON GENERAL MEETINGS

However, MCA vide its Notifications No. G.S.R. 582(E) dated 13th June, 2017

modified the above cited Notification dated 5th June, 2015 to provide that in

case of a Government company, the Annual General Meeting (AGM) shall be

held at its registered office or some other place within the city, town or vil age

in which the registered office of the company is situated or at any other place

with the approval of the Central Government.

Accordingly, now there is no need of Central Government approval, if a

Government Company is holding its AGM within the city, town or vil age in

which registered office of the company is situated.

In case of a private company, the Notice shall specify the entitlement of a

member to appoint proxy in accordance with this para, unless otherwise

provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

entitlement of members to appoint proxy. In such a case, the Notice of General

Meetings should contain matters in accordance with the Articles [In line with

MCA Notification No. G.S.R. 464(E) dated June 5, 2015].

1.2.5 Notice shal clearly specify the nature of the Meeting and the

business to be transacted thereat. In respect of items of Special

Business, each such item shal be in the form of a Resolution

and shal be accompanied by an explanatory statement which

shal set out al such facts as would enable a Member to

understand the meaning, scope and implications of the item

of business and to take a decision thereon. In respect of items

of Ordinary Business, Resolutions are not required to be stated

in the Notice.

A Notice, in order to be valid, should clearly state the nature or type of Meeting

i.e. Annual General Meeting or Extra-Ordinary General Meeting and the business

to be transacted at such Meeting, and should give al material information so

as to enable such items of business to be ful y understood by the Members.

In the case of an Annual General Meeting which is convened within the

extended period as granted by the Registrar of Companies under the third

proviso to sub-section (1) of Section 96 of the Act, the Notice convening such

Annual General Meeting should include the fol owing information:

(a) the fact that such an extension of time has been sought and the reasons

therefor;

GUIDANCE NOTE ON GENERAL MEETINGS

25

(b) whether the Meeting is being convened within the extended time;

(c) any other relevant information.

Nature of business to be transacted at a Meeting and types of Resolution

In the case of an Annual General Meeting, the business to be transacted at the

Meeting should be divided into two parts – Ordinary Business and Special

Business. Al business other than Ordinary Business shall be Special Business.

However, in case of an Extra-Ordinary General Meeting, all business shall be

Special Business.

Each item of Special Business should be in the form of Resolution. The

Resolutions are broadly of two types: Ordinary Resolutions and Special

Resolutions. Ordinary and Special Resolutions have been defined under Section

114 of the Act. Broadly, Ordinary Resolutions are required to be passed by

simple majority, whereas Special Resolutions are required to be passed by

three–fourth (3/4th) majority. In case of a Special Resolution, the Notice of the

Meeting should state that a particular Resolution is proposed to be passed as

a Special Resolution [Clause (a) of sub-section (2) of Section 114 of the Act].

Explanatory statement

The detailed particulars in respect of Ordinary Business may be given in the

Notice itself or may be given in the Board’s Report. In such cases, explanatory

statement need not be given. For example, the item of business in relation to

dividend may be stated in the Notice merely as “To declare a dividend”, in

which case, in the Board’s Report, ful details should be given regarding the

rate/amount of dividend recommended by the Board of Directors.

In respect of Special Business, an explanatory statement should be annexed to

the Notice of the Meeting [Sub-section (1) of Section 102 of the Act].

Such explanatory statement should be issued by the same person who has

been authorised to issue the Notice and in the same manner in which he has

issued the Notice.

The underlying objective behind Section 173 of the Companies Act, 1956

(corresponding to Section 102 of the Act) is that the shareholders may have

before them all material facts so as to enable them to form a judgment on the

item of business before them. Any fact which would influence their decision, one

way or the other, would be a material fact under the Act and has to be set out in

the explanatory statement attached to the Notice of the Meeting [Firestone Tyre

and Rubber Co. v. Synthetics and Chemicals Ltd. (1971) 41 Comp. Cas. 377 (Bom)].

26

GUIDANCE NOTE ON GENERAL MEETINGS

Material facts general y include the present facts which are necessary for the

shareholders to know and which may affect the decision of the shareholders

but do not include the reasons for which the company entered into the contract

with such party [In Re. Laljibhai C. Kapadia v. Lalji B. Desai [1973] 43 Comp.

Cas. 17 (Bom)].

Material facts have to be given, but not detailed explanations [East India

Commercial Co. Pvt. Ltd. v. Raymon Engineering Works Limited AIR 1966 Cal

232].

In relation to a General Meeting called on the basis of a valid requisition, there

is no duty on the part of the Board of Directors to furnish an explanatory statement

even though item(s) of business proposed to be transacted at any such General

Meeting wil be deemed to be a Special Business.

When the requisitionists are calling the Meeting, it is not necessary for them to

annex the explanatory statement along with the Notice. It is not duty of the

requisitionists to provide the explanatory statement also [Life Insurance

Corporation of India v. Escorts Ltd. (1986) 59 Comp. Cas. 548 (SC)].

A Notice issued and explanatory statement attached to it can be condemned

as tricky, if the same is likely to mislead shareholders or if there is an omission

to state the facts which would enable shareholders to decide if they would

attend Meeting or not [M. R. Goyal v. Usha Internationals Ltd. (1998) 93 Comp.

Cas. 634 (Del)].

It is a duty cast on the management to disclose, in an explanatory note, al

material facts relating to the Resolution coming up before the General Meeting

so as to enable the shareholders to form a judgment on the business before

them [Life Insurance Corporation of India v. Escorts Ltd. and others (1986) 59

Comp. Cas. 548 (SC)].

The explanatory statement accompanying the Notice is not to be read in

isolation and has to be read along with the item included in the agenda of

business to be transacted at the Meeting [Rajiv Nag v. Quality Assurance Institute

(India) Ltd. (2002) 37 SCL 25 (Del)].

Where the notice is published in a newspaper by the company, such explanatory

statement need not be published in the newspaper. It should be mentioned in

the newspaper that the notice along with explanatory statement has been sent

to the Members.

GUIDANCE NOTE ON GENERAL MEETINGS

27

Matters to be contained in the explanatory statement

The nature of the concern or interest (financial or otherwise), if any, of the

fol owing persons, in any special item of business or in a proposed Resolution,

shall be disclosed in the explanatory statement:

(a) Directors and Manager;

(b) Other Key Managerial Personnel; and

(c) Relatives of the persons mentioned above.

Material facts, including the nature of interest or concern of a Director, are

questions of facts, and therefore, while preparing the explanatory statement,

not only the information derived from records be stated but also sufficient

enquiry should be made to understand the nature of such interest or concern

of any Director and of any Key Managerial Personnel.

In case any item of Special Business to be transacted at a Meeting of the

company relates to or affects any other company, the extent of shareholding

interest in that other company of every Promoter, Director, Manager and of

every other Key Managerial Personnel of the first mentioned company shall, if

the extent of such shareholding is not less than two percent of the paid-up

share capital of that company, also be stated in the explanatory statement.

If the shareholding in that other company, of the persons specified in this

paragraph of SS-2, individual y or col ectively, exceeds or is equal to two percent,

the extent of such shareholding should be disclosed in the explanatory

statement.

Il ustration

XYZ Ltd. proposes to enter into a contract with PQR Ltd. Mr. X and Mr. Y,

who are promoters of XYZ Ltd. hold 1.5% and 0.5% of the total paid-up

share capital of PQR Ltd. respectively. In this case, the shareholding of

both, Mr. X and Mr. Y should be disclosed in the explanatory statement of

the Notice of General Meeting of XYZ Ltd., since the extent of their

shareholding col ectively is not less than two percent of the paid-up share

capital of PQR Ltd.

For this purpose, the shareholding includes preference shares and shares with

differential voting rights, if any.

Where reference is made to any document, contract, agreement, the

28

GUIDANCE NOTE ON GENERAL MEETINGS

Memorandum of Association or Articles of Association, the relevant explanatory

statement shall state that such documents are available for inspection and

such documents shall be so made available for inspection in physical or in

electronic form during specified business hours at the Registered Office of the

company and copies thereof shall also be made available for inspection in

physical or electronic form at the Head Office as wel as Corporate Office of the

company, if any, if such office is situated elsewhere, and also at the Meeting.

This has been incorporated with the intent of wider coverage and for

convenience of Members who visit such offices, and would also enhance

disclosures on the part of the company.

Sometimes, the company may have a separate Head Office or Corporate Office

located elsewhere than the Registered Office. In such cases, copies of the

aforesaid documents, contracts, agreements, the Memorandum of Association

or Articles of Association should also be made available for inspection at the

Head Office and the Corporate Office for the benefit of those Members who

may find it more convenient to visit these offices.

In such a case, the time during which and the place at which Members can

inspect such documents should be mentioned in the explanatory statement.

Such documents should be made available for inspection for not less than two

hours during business hours.

The requirement of furnishing an explanatory statement cannot be dispensed

with merely by giving an opportunity to Members to inspect the material

documents at the registered office of the company [See Circular of the then

Department of Company Affairs-No. F12(59)-CL-VI/63, dated 17 October, 1963].

Effect of MCA Notification

In case of a private company, explanatory statement shal comply with the

above requirements, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

contents of explanatory statement to the Notice of General Meetings. In such a

case, the Notice of General Meetings should contain such matters as provided

in the Articles [In line with MCA Notification No. G.S.R. 464(E) dated June 5,

2015].

In al cases relating to the appointment or re-appointment and/or fixation of

remuneration of Directors including Managing Director or Executive Director or

Whole-time Director or of Manager or variation of the terms of remuneration,

GUIDANCE NOTE ON GENERAL MEETINGS

29

details of each such Director or Manager, including age, qualifications,

experience, terms and conditions of appointment or re-appointment along

with details of remuneration sought to be paid and the remuneration last

drawn by such person, if applicable, date of first appointment on the Board,

shareholding in the company, relationship with other Directors, Manager and

other Key Managerial Personnel of the company, the number of Meetings of

the Board attended during the year and other Directorships, Membership/

Chairmanship of Committees of other Boards shal be given in the explanatory

statement.

The above requirement wil not be applicable in case of a Director who retires

by rotation and offers himself for re-appointment. Further, if a Director, who

retires by rotation, is not proposed to be re-appointed or is not interested in

being re-appointed, such fact should be clearly stated in the Notice. Further, the

Notice should also specify whether the company has decided to fil up the said

vacancy or not. If the company has decided to fil up the vacancy, the person

who is proposed to be appointed as a Director in the said vacancy should also

be specified in the Notice.

Regulation 26 of Listing Regulations: Obligations with respect to

Directors and Senior Management

Shareholding of Non-executive directors, held either by them or on a

beneficial basis for any other persons in the Equity Listed Company in

which they are proposed to be appointed as directors, should be disclosed

in the Notice of the General Meeting convened for appointment of such

director.

Regulation 36 of Listing Regulations : Documents & Information to

shareholders

In the case of appointment of a new director or re-appointment of a

director, the shareholders must also be provided with the fol owing

information:

(a) a brief resume of the director;

(b) nature of his expertise in specific functional areas;

(c) disclosure of relationships between directors inter-se;

(d) names of listed companies in which the person also holds the

directorship and the membership of Committees of the board

30

GUIDANCE NOTE ON GENERAL MEETINGS

viz. Audit Committee and Stakeholders Relationship Committee;

and

(e) shareholding of non-executive directors.

Such information shal be stated in the explanatory statement to the Notice

of the General Meeting convened for appointment of such directors.

Such information however is not required to be provided in case of

directors retiring by rotation and being eligible offering themselves for re-

appointment.

If the aforesaid details are given in the Annual Report, it would be sufficient

if appropriate reference is drawn to the particular portion of the Annual

Report in the explanatory statement to the Notice.

In case of appointment of Independent Directors, the justification for choosing

the appointees for appointment as Independent Directors shall be disclosed

and in case of re-appointment of Independent Directors, performance evaluation

report of such Director or summary thereof shall be included in the explanatory

statement.

Schedule IV to the Act provides that, on the basis of the report of performance

evaluation, it should be determined whether to extend or continue the term of

appointment of the Independent Director.

Re-appointment of the Independent Director would be recommended by the

Board only when there is a positive evaluation by the Board. Therefore,

performance evaluation report of Independent Director is important and the

same or a summary thereof should be included in the explanatory statement.

Further, as stated above, in the case of listed companies detailed resume and

particulars of Directors proposed to be appointed/re-appointed at the General

Meeting have to be given. The most appropriate place for giving such

information is the explanatory statement.

In case major amendments are proposed in the Articles, the details thereof

should be given in the explanatory statement.

Al Resolutions and the explanatory statement should be framed in simple and

intel igible language so as to enable Members to understand the meaning,

scope and implications of the proposed items of business.

Where Notice is accompanied by the Annual Report and if the details required

GUIDANCE NOTE ON GENERAL MEETINGS

31

under this paragraph of SS-2 are given in the Annual Report, it would be

sufficient if appropriate reference is drawn in the explanatory statement to the

particular portion of the Annual Report.

Validity of a Meeting held without explanatory statement

Wherever the Act requires certain specific items to be considered by the

company and to explain these in the explanatory statement, the same should

be included, failing which the Notice shal be invalid.

Moreover, non furnishing of an explanatory statement or furnishing of an

inadequate explanatory statement may be fatal to the validity of the very

Resolution passed, even though the Meeting might have otherwise been validly

cal ed and held.

In the interest of shareholders, all material facts concerning the transaction

need to be placed before them so that they may, of their own capacity, arrive at

a judgment without the influence of the management and therefore any

contravention in this regard should lead to a nul ification of proceedings [Sheth

Mohanlal Ganpatram v. Shri Sayaji Jubilee Cotton and Jute Mil s Co. Ltd. (1974)

34 Comp. Cas. 777 (Guj)].

A minor defect arising out of absence of strict conformity with the provisions of

Section 173 of the Companies Act, 1956 (corresponding to Section 102 of the

Act) may, however, not render the Resolution nul and void [Joseph Michael v.

Travancore Rubber and Tea Co. Limited (1986) 59 Comp. Cas. 898 (Ker)].

1.2.6 Notice and accompanying documents shal be given at least

twenty-one clear days in advance of the Meeting.

A General Meeting should be called by giving at least twenty-one clear days’

Notice of the Meeting.

Manner of computation of twenty-one clear days

For the purpose of reckoning twenty-one days clear Notice, the day of sending

the Notice and the day of Meeting shall not be counted.

The expression “twenty-one clear days”, means that the date of service of

Notice and the date of the Meeting are to be excluded when calculating the

period of twenty-one days [N.V.R. Naggappa Chettair v. Madras Race Club

(1949) 19 Comp. Cas. 175 (Mad)].

Further, fractions of days are not to be taken into account i.e. part of the day

after the hour at which the Notice is posted cannot be combined with the part

32

GUIDANCE NOTE ON GENERAL MEETINGS

of the day before the Meeting commences, to form one day. Each of these days

should be a ful or a calendar day [Bharat Kumar Dilwali v. Bharat Carbon &

Ribbon Mfg. Co. Ltd. (1973) 43 Comp. Cas. 197 (Del)].

Intervening holidays are counted within the period of Notice.

Il ustration

If a Meeting is to be held on the 25th of a month, Notice should be given

on or before 3rd of the same month i.e. at least twenty three days before

the date of the Meeting.

Il ustration

ABC Ltd. issued a Notice on 1st August, 2017 to hold its General Meeting

on 23rd August, 2017. Check the validity of the Notice, in case it is sent by

email.

Date of holding General Meeting: 23rd August, 2017

Date of dispatch of notice: 1st August, 2017

Days to be excluded:

(a) Day of holding General Meeting i.e. 23rd August, 2017

(b) Day of dispatch of notice i.e. 1st August, 2017

Number of days notice given: 21 days. The Notice is valid.

Addition of two days for Notice Posted

Further in case the company sends the Notice by post or courier, an additional

two days shall be provided for the service of Notice.

Addition of two days in case the company sends the Notice by post or courier

is in line with Rule 35(6) of the Companies (Incorporation) Rules, 2014 which

provides that in case of delivery by post, such service shall be deemed to have

been effected in the case of a Notice of a Meeting, at the expiration of forty

eight hours after the letter containing the same is posted.

Il ustration

If a Meeting is to be held on the 25th of a month, Notice should be posted

on or before 1st of the same month i.e. at least twenty five days before the

date of the Meeting.

GUIDANCE NOTE ON GENERAL MEETINGS

33

Il ustration

ABC Ltd. issued a Notice on 1st August, 2017 to hold its General Meeting

on 24th August, 2017. Check the validity of the Notice, in case it is sent by

post.

Date of holding General Meeting: 24th August, 2017

Date of dispatch of Notice: 1st August, 2017

Days to be excluded:

(a) Day of holding General Meeting i.e. 24th August, 2017

(b) Day of dispatch of Notice i.e. 1st August, 2017

(c) 2 days for service of Notice i.e. 2nd & 3rd August, 2017

Number of days’ Notice given: 20 days

21 clear days’ Notice is required under section 101 of the Act. Therefore it

is not a case of valid Notice. However, shortfall of 1 day in the given case

can be condoned if consent is given for such shorter Notice by at least

95% of the members entitled to vote at such General Meeting in

accordance with Paragraph 1.2.7 of SS-2.

“Posted” is taken to mean the delivery of the envelope to an authorised official

of a post office or a courier agency, which need not necessarily be the post box

or the post office or the courier agency office situated within the city where the

Registered Office of the company is situated. When mail is posted in bulk for

franking by the post office or the courier agency, it is not sufficient to rely

merely on the date indicated on the seal impressed on the envelope; a certificate

should be obtained.

Where Notices are posted on time, the fact that some Members received them

late wil not affect the validity of the Notice or the Meeting [Calcutta Chemicals

Co. Ltd. v. Dhiresh Chandra Roy (1985) 58 Comp. Cas. 276 (Cal) and Maharaja

Exports and Another v. Apparels Exports Promotion Council (1986) 60 Comp.

Cas. 353 (Del)].

The fact that Notice of a Meeting of shareholders to be held under directions of

the Court for consideration of a scheme of amalgamation was delivered late to

a shareholder owing to postal delay or omissions on the part of postal authorities

would not invalidate the Meeting [Maknam Investments Ltd., In Re. (1996) 87

Comp. Cas. 689 (Cal)], nor would the company be responsible for a necessary

34

GUIDANCE NOTE ON GENERAL MEETINGS

dependence on a third party agency for due services of Notice [Somalingappa

Shiva Putrappa Mugabasav v. Shree Renuka Sugars Ltd. (2002) 110 Comp. Cas.

371 (Kar)].

Though a Notice shall be deemed to be given at the expiry of forty-eight hours

after the envelope containing the Notice was posted, in some circumstances

(such as civil disturbance, curfew etc.), where the senders of the Notice know

that the envelope has not been “received” by the post, this deeming provision

is inoperative and not to be relied upon [Re. Thundercrest Ltd. (1995) 1 BCLC 117

(Ch D) and Bradman v. Trinity Estate Plc (1989) BCLC 33].

Serving of Notice through advertisement

Where the Notice is also published in a newspaper, twenty-one clear days

should be reckoned from the date on which such advertisement appears.

Such advertisement may also contain information regarding the days during

which the Register of Members would remain closed or the date fixed as the

record date, which is the last date by which changes in the status of Members

are recorded by the company.

Notice Period in the Articles

The Articles of the company may provide for a longer Notice period in which

case the Articles should be complied with. A longer Notice period wil be

beneficial for the shareholders as they wil get sufficient time to take the decisions

regarding the matters to be considered at the General Meeting of the company.

Effect of MCA Notification

In case of a private company, the period of sending Notice including

accompanying documents shal be as stated above, unless otherwise provided

in the Articles.

In case of a private company, the Articles may contain a provision as to the

Notice period of General Meetings. In such a case, the Notice of General

Meetings should be issued in accordance with the Articles [In line with MCA

Notification No. G.S.R. 464(E) dated June 5, 2015].In case of Nidhis, in respect of

Members who do not individual y or jointly hold shares of more than one

thousand rupees in face value or more than one percent of the total paid-up

share capital whichever is less, it shal be sufficient compliance with the

provisions of Section 136, if an intimation is sent by public notice in newspaper

circulated in the district in which the Registered Office of the Nidhi is situated

stating –

GUIDANCE NOTE ON GENERAL MEETINGS

35

(i) the date, time and venue of Annual General Meeting;

(i ) that the financial statement with its enclosures can be inspected at the

Registered Office of the company;

(i i) that the financial statement with enclosures are affixed at the Notice

Board of the company; and

(iv) a Member is entitled to vote either in person or through Proxy.

[ In line with MCA Notification No. G.S.R. 465(E) dated June 5, 2015].

Special Notice

In case a valid special notice under the Act has been received from Member(s),

the company shall give Notice of the Resolution to al its Members at least

seven days before the Meeting, exclusive of the day of dispatch of Notice and

day of the Meeting, in the same manner as a Notice of any General Meeting is

to be given.

A Special Notice may be received by the company, signed, either individually

or col ectively, by such number of Members holding not less than one percent

of total voting power or holding shares on which aggregate sum of not less

than five lakh rupees has been paid up on the date of the Notice [Rule 23(1) of

the Companies (Management and Administration) Rules, 2014]. In such a case,

the item proposed by a Member should be transacted at the Meeting, although

such item does not form part of the Notice of the Meeting.

However, such Notice should be sent by members to the company not earlier

than three months but at least fourteen days before the date of the Meeting at

which the Resolution is to be moved, exclusive of the day on which the Notice

is given and the day of the Meeting [Rule 23(2) of Companies (Management

and Administration) Rules, 2014].

Notice for such item received, if any, should be given by the company to its

Members individually at least seven clear days before the Meeting.

Where this is not practicable, the Notice shal be published in a vernacular

newspaper in the principal vernacular language of the district in which the

registered office of the company is situated, and in an English newspaper in

English language, both having a wide circulation in that district, at least seven

days before the Meeting, exclusive of the day of publication of the Notice and

day of the Meeting. In case of companies having a website, such Notice shal

simultaneously be hosted on the website.

36

GUIDANCE NOTE ON GENERAL MEETINGS

Regulation 47(1)(d) of Listing Regulations: Advertisements in Newspapers

Equity Listed Company should publish the Notices given to shareholders

by advertisement in at least one English language daily newspaper

circulating in the whole or substantial y the whole of India and in one

daily newspaper published in the language of the region, where the

registered office is situated, simultaneously with the submission of the

same to the stock exchange(s). A reference should be given in the

newspaper publication, to link of the website of the Company and stock

exchange(s) where further details are available. However, Company whose

specified securities have been listed on SME Exchange are not required

to give such advertisement in newspaper as stated above.

1.2.7 Notice and accompanying documents may be given at a shorter

period of time if consent in writing is given thereto, by physical

or electronic means, by not less than ninety-five per cent of

the Members entitled to vote at such Meeting.

The request for consenting to shorter Notice and accompanying documents

shall be sent together with the Notice and the Meeting shall be held only if the

consent is received prior to the time fixed for the Meeting from not less than

ninety five per cent of the Members entitled to vote at such Meeting.

The company shall ensure compliance of provisions relating to appointment of

proxy unless al the Members entitled to vote at such Meeting, consent to

holding of the General Meeting at shorter Notice.

This Paragraph of SS-2 and the explanation thereto should be read in conjunction.

The consent, in writing, for shorter Notice and for sending the accompanying

documents need not be taken from the Members prior to the sending of such

Notice.

However, request for such consent should be sent together with such Notice

and the requisite consent from the Members should be received before the

time fixed for the Meeting. Only if such consent from the requisite majority is

received, the General Meeting can be held at a shorter Notice, subject to

compliance of provisions relating to appointment of proxy. However, if consent

for shorter Notice is received from al the Members entitled to vote at the

Meeting, the proxy requirements need not be complied with.

A person holding a specific power of attorney may sign the consent of a

Member entitled to receive notices, and such consent shal be deemed as the

consent of Member concerned.

GUIDANCE NOTE ON GENERAL MEETINGS

37

Il ustration 1:

Say, a company XYZ Ltd. wish to hold its General Meeting at a shorter

notice, immediately after the Board Meeting on same day and the

required consent from 95% of the Members entitled to vote at the Meeting

is received before the time fixed for commencement of Meeting. Although

in such a case the consent of 95% Members entitled to vote at the meeting

is received, stil the proxy requirements need to be complied with by the

Company.

In other words, in the above case the Board Meeting and General Meeting

can’t be held on the same day.

Il ustration 2:

Considering the above il ustration, if the consent of all the Members (i.e.

100%) entitled to vote at such Meeting is received before the time fixed

for commencement of the Meeting, the proxy requirements need not be

complied with.

In other words, in such a case the Board Meeting and General Meeting

can be held on the same day.

Consent of Members not attending the Meeting at shorter Notice cannot

be implied

Consent means ‘consent of Members entitled to attend and vote’ and not ‘of

Members entitled to vote and present’ – it is not enough that the Members

present at the Meeting indicated either expressly or impliedly that they

consented to or acquiesced in shortening the period of Notice [N.V.R Nagappa

Chettiar v. Madras Race Club (1949) 19 Comp. Cas. 175 (Mad)].

The requirement is of consent by not less than 95% of the Members entitled to

vote and not of the Members holding 95% of the share capital i.e. if a company

has 100 Members entitled to vote, consent should be obtained from 95

Members, irrespective of the shareholding of these Members.

Effect of MCA Notification

In case of a private company, consent for shorter Notice shal be obtained from

such number of members as specified in this para, unless otherwise provided

in the Articles.

38

GUIDANCE NOTE ON GENERAL MEETINGS

1.2.8 No business shal be transacted at a Meeting if Notice in

accordance with this Standard has not been given.

Where the Members assemble for a Meeting but the Notice of such Meeting

does not comply with the requirements prescribed in the Standard, no business

should be transacted at such Meeting.

However, any accidental omission to give Notice to, or the non-receipt of such

Notice by any Member or other person who is entitled to such Notice for any

Meeting shall not invalidate the proceedings of the Meeting.

Accidental omission to give Notice

“Accidental omission” means omission which is neither designed nor deliberate

and implies absence of intention [Maharaja Exports and Another v. Apparels

Exports Promotion Council (1986) 60 Comp. Cas. 353 (Del)].

In the absence of mala fide intention or negligence, the non-receipt of Notice

by any Member wil not affect the validity of the Meeting.

The onus is on the company to prove that the omission to give Notice to the

shareholder was accidental.

Non accidental omission to give Notice

An omission which arises from an error as to legal position cannot be classified

as accidental.

Failure to give Notice of a General Meeting to the unpaid vendors of shares

(viz. those who have transferred the shares for a price but the price has not yet

been paid), who remained on the Register of Members, on the erroneous

belief of the Directors that the vendors were no longer Members is wrong in

law and the resulting failure to give Notice is not “accidental” [Musselwhite v.

C.H. Musselwhite & Son Limited (1962) 32 Comp. Cas. 804 (CD)].

1.2.9 No items of business other than those specified in the Notice

and those specifical y permitted under the Act shal be taken

up at the Meeting.

Notice of the Meeting should contain a list of items of business to be transacted

thereat together with Resolutions relating to Special Business so as to ensure

that Members get proper time to form their judgment on whether to vote for or

against the proposed Resolution. The transaction of an item of business which

has not been properly notified or which is substantial y different from that notified

is invalid [Cf. Henderson v. Bank of Australasia (1890) 45 Ch D 330].

GUIDANCE NOTE ON GENERAL MEETINGS

39

However, this wil not invalidate the transaction of other items of business for

which proper Notice has been given.

A Resolution shall be valid only if it is passed in respect of an item of business

contained in the Notice convening the Meeting or it is specifically permitted

under the Act.

Apart from the items of business contained in the Notice convening the Meeting,

there are specific items permitted under the Act, which may be taken up for

consideration at the Meeting.

Items specifically permitted under the Act which may be taken up for

consideration at the Meeting are:

(a) Proposed Resolutions, the Notice of which has been given by Members;

(b) Resolutions requiring Special Notice, if received with the intention to

move;

(c) Candidature for Directorship, if any such Notice has been received.

Where special notice is required of any Resolution and notice of the intention to

move such Resolution is received by the company from the prescribed number

of Members, such item of business shall be placed for consideration at the

Meeting after giving Notice of the Resolution to Members in the manner

prescribed under the Act.

Any amendment to the Notice, including the addition of any item of business,

can be made provided the Notice of amendment is given to all persons entitled

to receive the Notice of the Meeting at least twenty one clear days before the

Meeting.

Any amendment to the Notice, including the addition of any item of business,

may be made at a shorter Notice only after complying with the provisions of

paragraph 1.2.7 of SS-2.

However, where e-voting is provided, any such amendment to the Notice can

be made only by issuing a fresh Notice at least twenty-one clear days in

advance.

The Notice of any amendment, including the addition of any item of business,

should be sent individually by any mode specified for sending Notice and not

be given through advertisement.

Any printing or typographical errors or grammatical or clerical mistakes

40

GUIDANCE NOTE ON GENERAL MEETINGS

identified in the Notice or the accounts, reports and statements attached thereto,

may be rectified and intimated to the Members in the form of an erratum. Such

erratum may be circulated to Members at the General Meeting itself. However,

if such errors are on the text of Resolutions proposed, it is necessary to notify

the Members as soon as they are discovered and no corrections should be

made to the text of the Resolutions after commencement of voting including e-

voting.

When the Meeting is being cal ed by the requisitionists and the agenda for

such Meeting is made by the requisitionists themselves, the Directors may, if

they deem fit, add to the items of agenda, any business to be discussed at

such Meeting. The consent for inclusion of such additional item at a shorter

Notice should be obtained in the manner as specified in paragraph 1.2.7 of SS-

2.

1.2.10 Notice shal be accompanied, by an attendance slip and a

Proxy form with clear instructions for fil ing, stamping, signing

and/or depositing the Proxy form.

The Notice of the Meeting should be accompanied by an attendance slip. A

specimen of the Attendance Slip is placed at Annexure I. In case, a company

has the practice of maintaining an attendance register containing signatures of

Members attending the General Meeting, the same would be sufficient

compliance for the purpose of sending “attendance slip” in accordance with

this paragraph.

The Notice of the General Meeting should also be accompanied by a Proxy

form, so as to enable the Member to appoint a Proxy. The Proxy form should

indicate the time limit within which proxies are to be deposited, the procedural

requirement of stamping and signing of proxies and should also specify clearly

the instructions for fil ing up the Proxy form.

Notes to Notice

Notes are an integral part of the Notice of General Meetings. Notes to the

Notice should be given immediately after the information pertaining to the

business to be transacted under the heads of Ordinary Business and Special

Business. They may inter-alia contain the fol owing information:

(a) Information to Members about their right to appoint Proxy and informing

them to lodge proxies not less than forty-eight hours before the time

fixed for the Meeting.

GUIDANCE NOTE ON GENERAL MEETINGS

41

(b) Intimation that an explanatory statement pursuant to sub–section (1) of

Section 102 of the Act is annexed to the Notice.

(c) Dates of closure of Register of Members and Share Transfer Books.

(d) Information about nomination facility available to Members.

(e) Intimation that dividend, if declared, would be paid within thirty days

from the date of declaration to Members whose names appear as

beneficial owners with depositories or in the Register of Members as

on the date specified for the purpose.

(f) Request to Members to claim any dividend due to them but remaining

unclaimed or unpaid.

(g) Intimation with respect to dividend / shares proposed to be transferred

to IEPF pursuant to the requirements of the Act and requesting the

Members to claim such dividend / shares from the Company.

(h) Request to Members to furnish details such as Bank Account No., name

of the Bank, Branch, IFSC Code and Place with PIN Code No. where the

account is maintained to prevent fraudulent encashment of dividend

warrants.

(i) Details of ECS/NEFT/RTGS/other similar electronic transfer facility

available, if any, for Members.

(j) Address of share transfer agents whom Members may contact in case

of any change of address or queries relating to their shares.

(k) Request to Members holding multiple folios to get their holdings

consolidated.

(l) Intimation regarding the availability of statutory registers or other

documents referred to in the Notice/explanatory statement for inspection

by Members.

(m) Request to Members to bring to the Meeting the attendance slip along

with their copy of the Annual Report.

(n) Request to Members holding shares in dematerialised form to bring

their Client ID and DP ID numbers for easy identification for attendance

at the Meeting.

(o) Instructions for Remote e-voting, period for Remote e-voting, the manner

in which the company would provide voting facility at the Meeting, etc.

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GUIDANCE NOTE ON GENERAL MEETINGS

(p) In case of any Resolution to be passed through postal bal ot, the details

of the procedure of such postal ballot and the fact that the company is

providing the e-voting facility to the shareholders.

(q) Request to Members to register/update their e-mail IDs with the

company/ depository, so that the Notice and related documents can be

served to Members on their e-mail IDs.

An il ustrative list of documents to be sent along with the Notice of General

Meeting is given below:

1. Explanatory statement to the Notice.

2. Proxy Form and instructions on e-voting, if any.

3. Attendance Slip.

4. Request for consenting to shorter Notice, if any.

5. Supporting documents (like Articles of Association) in connection with

the agenda items in the Notice, if any.

Specimen Notices of Annual General Meeting and Extra-Ordinary General

Meeting are placed at Annexure I and I I respectively.

A specimen of Newspaper Advertisement of the Notice of a General Meeting

is placed at Annexure IV.

Regulation 44(4) of Listing Regulations: Voting by shareholders

Equity Listed Company should send proxy forms to holders of securities in

all cases mentioning that a holder may vote either for or against each

resolution.

1.2.11 A Meeting convened upon due Notice shal not be postponed

or cancelled.

Once a General Meeting has been convened upon due Notice, it should not be

postponed or cancelled.

In construing the above stipulation, it is necessary to keep in mind the maxim

Ex Non Cogit Impossibilia. In other words, law does not require anything which

is impossible to be done. Much would depend upon the facts and

circumstances of each case.

GUIDANCE NOTE ON GENERAL MEETINGS

43

If, for reasons beyond the control of the Board, a Meeting cannot be held on

the date original y fixed, the Board may reconvene the Meeting, to transact

the same business as specified in the original Notice, after giving not less

than three days intimation to the Members. The intimation shal be either

sent individually in the manner stated in this Standard or published in a

vernacular newspaper in the principal vernacular language of the district

in which the registered office of the company is situated, and in an

English newspaper in English language, both having a wide circulation in

that district.

No Meeting should be postponed merely for the reason that it would be

inconvenient to hold the Meeting at the stated time and place. Postponement

should be resorted to only if it is impossible to hold the Meeting, e.g. there is a

curfew in the city or there is a threat to life and property. To cover such

eventualities, the Board has the power to postpone the Meeting.

The fact of postponement should, as far as possible, be communicated to

Members without any delay by newspaper advertisements and e-mails. Further,

the company should also post the announcement on its website. Such intimation

of postponement may also refer to the Members’ right to appoint a Proxy.

Further, there should be someone at the venue, if possible, to inform the

Members of the postponement, in case some Members do turn up at the

venue without knowledge of the postponement of the Meeting.

Force majeure would also include destruction of the proposed venue. In such

situations, the company may choose an alternative venue for the Meeting and

inform the Members as early as possible, in writing and by newspaper

advertisement. If any such event takes place on the day of the Meeting, the

company may, with the consent of the Members who come to the venue,

change the venue and time of the Meeting and enable them to reach the

changed venue of the Meeting.

If, for any reason a General Meeting is postponed, it is not necessary to postpone

the period for Remote e-voting. However, the result of Remote e-voting cannot

be announced until such Meeting is actual y held.

Specimens of Notice of Postponed Annual General Meeting and Notice in

Newspapers of postponement of Annual General Meeting are placed at

Annexure V and VI respectively.

44

GUIDANCE NOTE ON GENERAL MEETINGS

2. Frequency of Meetings

2.1 Annual General Meeting

Every company shall, in each Calendar Year, hold a General Meeting cal ed

the Annual General Meeting.

Every company shall hold its first Annual General Meeting within nine months

from the date of closing of the first financial year of the company and thereafter

in each Calendar Year within six months of the close of the financial year, with

an interval of not more than fifteen months between two successive Annual

General Meetings. The aforesaid period of six months or interval of fifteen

months may be extended by a period not exceeding three months with the

prior approval of the Registrar of Companies, in case of any Annual General

Meeting other than the first Annual General Meeting.

Sub-section (1) of Section 96 of the Act requires that the subsequent Annual

General Meeting should be held on the earliest of the fol owing dates:

(a) fifteen months from the date of the last Annual General Meeting; or

(b) the last day of the calendar year; or

(c) six months from the close of the financial year.

If a statute enjoins that the Meeting is to be held within a specified period, it

fol ows by necessary implication that it must be completed within the said

period. If financial statements are not ready to be laid at the concerned Annual

General Meeting, it shal be open to the company to adjourn the Annual General

Meeting to a subsequent date when the financial statements would be ready

for consideration. The adjourned Meeting must be held within the maximum

time limit al owed under the Act [Bejoy Kumar Karnani and Another v. Assistant

Registrar of Companies and Another (1985) 58 Comp. Cas. 293 (Cal)].

The fact that the company was not functioning [Madan Gopal Dey v. State of

West Bengal AIR 1968 Cal 790] or that the management of the Company was

taken over by the Government [Hindustan Co-operative Insurance Society Ltd.,

In Re., (1961) 31 Comp. Cas. 193 (Cal)] is no excuse for not holding the Annual

General Meeting.

Hence, the company has to convene and hold a Meeting in each calendar

year with a maximum gap of fifteen months between two Annual General

Meetings.

If a company holds its first Annual General Meeting, as aforesaid, it shall not

GUIDANCE NOTE ON GENERAL MEETINGS

45

be necessary for the company to hold any Annual General Meeting in the

Calendar Year of its incorporation.

Il ustration

Say, a company was incorporated on 10th December 2016, “financial year”

of that company would end on 31st March 2017 in view of sub-section (41)

of Section 2 of the Act and therefore the last date for holding the first

Annual General Meeting would be 31st December 2017 (9 months from

31st March 2017).

On the other hand, if a company was incorporated on 10th April 2016, its

first financial year would end on 31st March 2017 only and therefore, the

last date for holding the first Annual General Meeting wil be 31st December

2017. In this manner, almost 21 months elapse between the date of

incorporation and date of first Annual General Meeting. In this case, the

company need not hold any Annual General Meeting in the year of its

incorporation i.e. 2016.

The Notice of an Annual General Meeting should state that the Meeting is an

‘Annual General Meeting’. An Annual General Meeting is held apart from and

in addition to any other General Meeting that a company may hold.

An adjourned Meeting is a continuation of the original Meeting. Hence, where

a Meeting called and held on a day in one year is adjourned to a date in the

next year, and held on that date, such adjourned Meeting held on the latter

date is not a different Meeting in so far as it relates to the next year. In other

words, another Annual General Meeting has to be held in the next calendar

year.

Where a Meeting called on 30th December was adjourned to 31st March in the

next year, and the next Meeting was held on 28th January of the fol owing year,

Section 166 of the Companies Act, 1956 (corresponding to Section 96 of the Act)

was not complied with, i.e. an Annual General Meeting was not held in ‘each

year’ and the company was convicted of an offence [Sree Meenakshi Mil s Co.

Ltd. v. Assistant Registrar, Madurai (1938) 8 Comp. Cas. 175 (Mad)].

Power of the Registrar to extend time for holding Annual General Meeting

The Registrar of Companies may extend the time for holding an Annual General

Meeting, other than the first Annual General Meeting, “for any special reason”

by a period not exceeding three months, if it cannot be held within the prescribed

time limit [Third proviso of sub-section (1) of Section 96 of the Act]. Therefore, if

46

GUIDANCE NOTE ON GENERAL MEETINGS

in any year a company cannot hold its Annual General Meeting within the

period stipulated in sub-section (1) of Section 96 of the Act, it may hold the

Meeting within the next three months with the permission of the Registrar of

Companies. In such a case, the gap between two Annual General Meetings

may be more than the period of fifteen months stipulated under sub-section (1)

of Section 96 of the Act. However, in such a case it should be ensured that the

concerned Annual General Meeting is actually held on or before the extended

time limit and the Notice should specify the fact of extension of time for holding

the Annual General Meeting.

No extension of time can be granted by the Registrar beyond three months.

Delay in completion of audit of the financial statements of the company does

not ordinarily constitute a “special reason” justifying the extension of time for

holding the Annual General Meeting.

Default in holding Annual General Meeting

If a company defaults in holding an Annual General Meeting, any Member

may apply to the Tribunal which may notwithstanding anything contained in

the Act or Articles of the company, cal or direct the calling of the Meeting and

give such ancil ary or consequential directions as it may consider expedient in

relation to the cal ing, holding and conduct of the Meeting. The Tribunal may

direct the convening of the Annual General Meeting only if it is convinced that

the management has been unwil ing to convene such a Meeting or it was not

practicable for the management to do so [Section 97 of the Act].

The power of the Tribunal cannot be invoked unless there is, in the first place,

a default on the part of the Board of Directors to call and hold the Annual

General Meeting. To invoke such power, the last date by which the Notice

should have been given by the Board ought to have expired. This right is

available only to a Member of the company and the company, by itself, cannot

make such an application to the Tribunal.

In such cases, the Tribunal may direct that one Member present in person or

by Proxy shall be deemed to constitute the Meeting. A Meeting held in

pursuance of such order wil be deemed to be an Annual General Meeting of

the company. However, the Tribunal cannot issue directions or instructions in

regard to an Annual General Meeting duly convened by the company. It can do

so only in respect of Meetings convened on its orders[Shankar Sundaram v.

Amalgamations Private Limited (2002) CLC 701].

If, at the time an Annual General Meeting is due to be held, there is only one

GUIDANCE NOTE ON GENERAL MEETINGS

47

Member [the other(s) having died], no of ence is committed if the Annual General

Meeting is not held because of the insufficiency of number of Members [State

of Kerala v. West Coast Planter’s Agencies Ltd. (1958) 28 Comp. Cas. 13 (Ker)].

2.2 Extra-Ordinary General Meeting

Items of business other than Ordinary Business may be considered at an

Extra-Ordinary General Meeting or by means of a postal bal ot, if thought

fit by the Board.

General Meetings, other than an Annual General Meeting, are cal ed Extra-

Ordinary General Meetings. The company may provide for such Meetings in

their Articles in order to deal with matters which have to be decided before the

next Annual General Meeting.

The Board of Directors, if they deem fit, may pass any Resolution through postal

bal ot, instead of convening an Extra-Ordinary General Meeting, in accordance

with the requirement of the Act.

Cal ing of an Extra-Ordinary General Meeting on Requisition

As already explained under paragraph 1.1, the Board should, within twenty-

one days from the date of receipt of a valid Requisition in regard to any matter,

proceed to call a Meeting for the consideration of those matters on a day not

later than forty-five days from the date of receipt of such requisition. If the Board

fails to do so, the Meeting may be called and held by the requisitionists

themselves within three months from the date of deposit of such requisition.

A specimen of Notice by requisitionists convening an Extra-Ordinary General

Meeting is placed at Annexure VI and a specimen of the Notice to be given by

a company to its Members on receipt of a requisition for a Meeting is placed at

Annexure VI I. A specimen of Board Resolution cal ing the Extra-Ordinary General

Meeting on the requisition of members is placed at Annexure IX.

Cal ing of Extra-Ordinary General Meeting by Tribunal

If, for any reason, it is impracticable to cal a Meeting of the company other

than an Annual General Meeting, the Tribunal may direct the calling of the

Meeting on its own motion or on an application of any Director or on an

application of any Member entitled to vote at the Meeting [Section 98 of the

Act]. For this purpose, the Tribunal may give directions in respect of the place,

date and manner in which the Meeting is to be held and conducted.

The term practicability is not defined in the Act, thus, the same shall vary in

48

GUIDANCE NOTE ON GENERAL MEETINGS

each case. However, it is construed that a case can be termed as impracticable

only in the event that it is impossible to convene the Meeting by the company

due to reasons which are beyond the control of the management.

3. Quorum

3.1 Quorum shal be present throughout the Meeting.

In order that a Meeting may be properly constituted and the business be validly

transacted, a Quorum of Members should be present.

Presence of a Quorum is very important for the purpose of conducting,

convening and holding the Meeting in a proper manner.

Quorum shal be present not only at the time of commencement of the Meeting

but also while transacting business.

A Quorum should be present when the questions brought before the Meeting

are being decided. The mere presence of Quorum at the beginning of the

Meeting is not sufficient.

Unless the Articles provide for a larger number, the Quorum for a General

Meeting shal be:

(a) in case of a public company, –

(i) five Members personally present if the number of Members as

on the date of Meeting is not more than one thousand;

(i ) fifteen Members personal y present if the number of Members as

on the date of Meeting is more than one thousand but up to five

thousand;

(i i) thirty Members personally present if the number of Members as

on the date of the Meeting exceeds five thousand;

(b) in the case of a private company, two Members personally present.

Where the Quorum provided in the Articles is higher than that provided under

the Act, the Quorum shall conform to such higher requirement.

The Articles of a private company can provide for a higher Quorum but it

cannot reduce the number of Members required to constitute the Quorum.

Personal presence necessary to constitute Quorum

Members need to be personal y present at a Meeting to constitute the Quorum.

GUIDANCE NOTE ON GENERAL MEETINGS

49

Only those Members who are present in person should be reckoned for

ascertaining the Quorum.

Proxies shall be excluded for determining the Quorum.

A Proxy cannot be considered as a Member personal y present and hence

excluded for determining Quorum. However, the fol owing persons attending a

Meeting would be considered as Members personally present; and hence

included to constitute Quorum:

(a) a representative appointed under Section 113 of the Act to attend a

Meeting on behalf of a body corporate;

(b) a representative appointed under Section 112 of the Act to attend a

Meeting on behalf of the President of India or Governor of a State.

(c) a donee of a Power-of-Attorney could be presumed to be personally

present if the power-of-attorney authorises such donee to attend and

vote at General Meetings of companies of which the donor of the

power-of-attorney is a Member.

In no other case, a person attending a Meeting as a representative of a Member

shall be regarded as a Member personal y present.

Donee of a general power of attorney not deemed as Proxy

If any Member of a company has given a general power-of-attorney in favour

of some other person to make investments on his behalf and to attend to al

matters incidental and consequential thereto including attending General

Meetings of companies in which investments are so made and if at General

Meetings of such companies, the donee is present, then it would be deemed,

by virtue of the provisions of Section 3 of the Powers-of-Attorney Act, 1882, that

the donor is personally present and the donee wil not be deemed to be a

Proxy of the donor [Cf. Tata Iron & Steel Co. Ltd., In Re., AIR 1928 Bom. 80].

Reckoning of Preference Shareholders and Joint Shareholders for Quorum

If any business to be transacted at a General Meeting does not include any

item or Resolution which directly af ects the rights of the preference shareholders,

their presence should not be taken into account for the purpose of determining

the Quorum. Where a Resolution is put to vote at the General Meeting by

which the rights of preference shareholders are directly affected, their presence

should be taken into account for the purpose of the Quorum and voting on the

Resolution.

50

GUIDANCE NOTE ON GENERAL MEETINGS

Al joint shareholders are entitled to attend the General Meetings. However, for

the purpose of ascertaining Quorum and for voting purposes, joint holders wil

be counted only as one Member since only one of them is entitled to vote.

Consequences of Meeting without proper Quorum

A General Meeting at which less than the number of Members prescribed for

a Quorum is present, is not a Meeting at all for want of the required Quorum.

The absence of a Quorum cannot be waived, and any business transacted at

a Meeting where a Quorum is absent is deemed void.

However, if all the Members of the company are present in person, the

proceedings wil be valid even if the Quorum required by the Articles is more

than the total number of Members.

Il ustration

Consider a company where the number of Members was original y large,

say 500, and the Quorum fixed by the Articles was 100 Members present.

Subsequently, 450 Members sold their shares which were acquired by

some of the remaining 50 Members. Here, proceedings wil be valid if

all Members are present in person. In the given case, if less than 50

Members are present, there shal be no Quorum.

If within half an hour from the time fixed for holding the Meeting a Quorum is

not present, the Meeting shal stand adjourned to the same day in the next

week at the same time and place or to such other day and at such other time

and place as the Board may determine. If at the adjourned Meeting within half

an hour from the time appointed for the Meeting the Quorum is not present, the

Members present shall form a Quorum [Sub–section (2) and (3) of Section 103

of the Act]. From the use of the words ‘Members present’, and the fact that

there cannot be a Meeting unless at least two persons are present, it fol ows

that at least two Members should be present even at the adjourned Meeting. If

a Meeting has been cal ed on the requisition of Members and there is no

Quorum for half an hour, the Meeting shal stand dissolved (These aspects of

Quorum have been further dealt with under the heading ‘Adjournment of

Meetings’).

The Act provides that the Quorum shal be present at the Meeting within half

an hour. If the Members want to wait for the Quorum for more than half an

hour, they can do so, as it is not prohibited in the Act. Waiting for a longer time

does not destroy the essence of law. The time of half an hour is recommendatory

GUIDANCE NOTE ON GENERAL MEETINGS

51

in nature and not mandatory [Janaki Printers Private Limited v. Nadar Press Ltd.

and Others (2001) 103 Comp. Cas. 546 (CLB)].

The requisite Quorum at the Meeting is required even if some Members have

already cast their votes through e-voting facility.

One-Man Meeting

It has been clarified by the Department of Company Affairs [now Ministry of

Corporate Affairs] that a single Member present cannot, by himself, constitute a

Quorum [Circulars and Clarifications Co. Law & SEBI, P1 198 vide File No.8/16/

(1)/61-PR ]. Such general rule against a one–man Meeting has also been settled

through judicial decisions.

There are, however, some exceptions to this general rule which permit a

Meeting to be constituted of only one Member. These are:

• Where a person holds all the shares of a class, that person may

constitute a class Meeting.

• Where default is made in holding an Annual General Meeting in

accordance with Section 96 of the Act, the Tribunal while ordering the

convening of the Meeting, may direct that one Member present in

person or by proxy wil constitute the Quorum [Proviso to sub-section

(1) of Section 97 of the Act].

• Where it is impracticable to cal a Meeting in the manner prescribed by

the Act or the Articles, the Tribunal may order a Meeting to be held and

direct that one Member present in person or by Proxy shal be deemed

to constitute a Meeting [Proviso to sub–section (1) of Section 98 of the

Act].

3.2 A duly authorised representative of a body corporate or the

representative of the President of India or the Governor of a State

is deemed to be a Member personal y present and enjoys al the

rights of a Member present in person.

One person can be an authorised representative of more than one body

corporate. In such a case, he is treated as more than one Member for the

purpose of Quorum.

A person who represents two different bodies is supposed to act in accordance

with the instructions of his principals. Therefore, such representative theoretical y

carries with him two sets of opinions on the Resolutions.

52

GUIDANCE NOTE ON GENERAL MEETINGS

If two or more bodies corporate, who are Members of a company, are

represented by a single individual, each of the bodies corporate should be

treated as personally present through that individual representing such bodies

corporate. For instance, if a representative represents three bodies corporate,

his presence should be counted as three Members being present in person for

purpose of Quorum [Maclead (Neil) & Sons Ltd., Petitioners, 1967 Scottish Law

Times 46].

However, to constitute a Meeting, at least two individuals shal be present in

person. Thus, in case of a public company having not more than 1000 Members

with a Quorum requirement of five Members, an authorised representative of

five bodies corporate cannot form a Quorum by himself but can do so if at least

one more Member is personal y present.

Say, in case of a company, where the Quorum requirement is five Members, a

single authorised representative of five bodies corporate cannot form Quorum

by himself if no other individual is personally present at the Meeting. However,

he can form a Quorum if at least one more Member is personal y present at

the Meeting.

This is so because a single Member present cannot by himself constitute a

Meeting. There are a number of decisions by which it is now firmly settled that

as a general rule a single person cannot constitute a Meeting. Few such cases

include Sharp v. Dawes (1876) 2 QBD 26 (CA), Awadhoot v. State of Maharashtra

AIR 1978 Bom 28, etc.

Members who have voted by Remote e-voting have the right to attend the

General Meeting and accordingly their presence shal be counted for the

purpose of Quorum.

A Member who is not entitled to vote on any particular item of business being

a related party, if present, shal be counted for the purpose of Quorum.

The stipulation regarding the presence of a Quorum does not apply with respect

to items of business transacted through postal ballot.

4. Presence of Directors and Auditors

4.1 Directors

4.1.1 If any Director is unable to attend the Meeting, the Chairman

shal explain such absence at the Meeting.

The Directors of the company act on behalf of the Members and therefore have

GUIDANCE NOTE ON GENERAL MEETINGS

53

fiduciary responsibilities towards them. They are individual y as wel as

col ectively responsible for the over-all management of the company. General

Meetings provide a forum to the Members to review the manner in which the

Directors manage the company while also giving the Directors an opportunity

to apprise the Members about the affairs of the company and to listen their

views and suggestions.

Al the Directors are, therefore, expected to attend the General Meetings of the

company. In case any Director is unable to attend the Meeting, the Chairman

should explain the absence of such Director at the Meeting. Such absence is,

however, not wrong in law.

The Chairman of the Audit Committee, Nomination and Remuneration

Committee and the Stakeholders Relationship Committee, or any other Member

of any such Committee authorised by the Chairman of the respective Committee

to attend on his behalf, shall attend the General Meeting.

While al Directors are expected to attend the General Meetings of the company,

the Chairmen of the Audit Committee, Nomination and Remuneration

Committee and the Stakeholders Relationship Committee are specifical y

required by this paragraph of SS-2, to attend the General Meeting of the

company. Flexibility has however been given to the Chairman of the respective

Committee to authorise any other Member of the Committee to attend the

General Meeting on his behalf, in case he is unable to be present at the

Meeting.

This Standard has been introduced as a good governance practice to ensure

that at least one Member of the above mentioned Committees is present at the

General Meeting in order to address the Members’ queries, if any, concerning

their respective Committees.

Regulation 18(1)(d) of Listing Regulations:

In case of Equity Listed Company, the Chairman of the Audit Committee

shal attend the Annual General Meeting to answer shareholder queries.

The Chairman of Audit Committee shall not authorise any other

representative to attend such Meeting on his behalf.

4.1.2 Directors who attend the General Meetings of the company

and the Company Secretary shal be seated with the Chairman.

The Company Secretary shal assist the Chairman in conducting the Meeting.

54

GUIDANCE NOTE ON GENERAL MEETINGS

Rule 10 of the Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014 clearly provides that it is the duty of the Company

Secretary to facilitate the convening of Meetings and to attend Board, Committee

and General Meetings and maintain their Minutes. Further, it is duty of the

Company Secretary to render assistance to the Chairman in conduct of the

Meeting.

It is in this context that this paragraph of SS-2 requires the Company Secretary

and directors to be seated with the Chairman.

The fol owing are some of the il ustrative situations under which assistance

can be rendered by the Company Secretary:

• To enable the Chairman to identify that requisite Quorum is present at

the Meeting

• To enable the Chairman to ascertain the votes cast on each Resolution

put to vote by show of hands

• To assist the Chairman in co-ordinating with the Members present at

the Meeting and answering their queries

• To facilitate voting at the Meeting, electronical y or otherwise

• To analyse the result of Remote e-voting and facilitate declaration thereof

• To maintain the decorum of the Meeting etc.

4.2 Auditors

The Auditors, unless exempted by the company, shal , either by themselves

or through their authorised representative, attend the General Meetings of

the company and shal have the right to be heard at such Meetings on that

part of the business which concerns them as Auditors.

Auditors or their authorised representative should attend the General Meetings

to reply to any query that may be raised or provide any explanation that may

be sought by the Members in relation to any part of the business which concerns

them or to any reservations, qualifications or adverse remarks made by them

in the Auditor’s Report.

The authorised representative who attends the General Meeting of the company

shall also be qualified to be an Auditor.

The authorised representative of the Auditor attending the General Meeting on

behalf of the Auditor should be a person who is a member of the Institute of

GUIDANCE NOTE ON GENERAL MEETINGS

55

Chartered Accountants of India (ICAI) and eligible for appointment as auditor of

the company.

4.3 Secretarial Auditor

The Secretarial Auditor, unless exempted by the company shal , either by

himself or through his authorised representative, attend the Annual General

Meeting and shal have the right to be heard at such Meeting on that part

of the business which concerns him as Secretarial Auditor.

Unless exempted by the company, the Secretarial Auditor for the last financial

year whose Secretarial Audit Report has been annexed to the Board Report, is

required to attend, either by himself or through his authorised representative,

the Annual General Meeting. The Secretarial Auditor shall have the right to be

heard at such Meeting on that part of the business which concerns him as

Secretarial Auditor.

Secretarial Auditor or his authorised representative should attend the Annual

General Meeting to reply to any query that may be raised or provide any

explanation that may be sought by the Members in relation to any part of the

business which concerns him or to any reservations, qualifications or adverse

remarks made by him in the Secretarial Audit Report or to the compliance and

governance aspects of the company.

It is advisable that the Secretarial Auditor appointed for the current financial

year in which Annual General Meeting is being held also attends such Annual

General Meeting.

The Chairman may invite the Secretarial Auditor or his authorised representative

to attend any other General Meeting, if he considers it necessary.

The authorised representative who attends the General Meeting of the company

shall also be qualified to be a Secretarial Auditor.

The authorised representative of the Secretarial Auditor attending the General

Meeting on behalf of the Secretarial Auditor should be a person who is a

member of the Institute of Company Secretaries of India (ICSI) and eligible for

appointment as Secretarial Auditor of the company.

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GUIDANCE NOTE ON GENERAL MEETINGS

5. Chairman

5.1 Appointment

The Chairman of the Board shal take the Chair and conduct the Meeting.

If the Chairman is not present within fifteen Minutes after the time appointed

for holding the Meeting, or if he is unwil ing to act as Chairman of the

Meeting, or if no Director has been so designated, the Directors present

at the Meeting shal elect one of themselves to be the Chairman of the

Meeting. If no Director is present within fifteen Minutes after the time

appointed for holding the Meeting, or if no Director is wil ing to take the

chair, the Members present shal elect, on a show of hands, one of

themselves to be the Chairman of the Meeting, unless otherwise provided

in the Articles.

The Chairman of the Board, if any, should be the Chairman of the company. It

is not necessary to pass a Resolution, either at a Board Meeting or a General

Meeting, in order to authorise the Chairman of the Board to preside over al

General Meetings. Unless otherwise provided in the Articles, the provisions

below should be complied with:

• The Chairman of the Board should preside over the General Meetings,

and therefore the Chairman of the Board, if present, should take the

chair.

• If there is no Chairman of the Board or if such Chairman of the Board is

not present within fifteen minutes after the time appointed for holding

the Meeting or if he declines to take the chair, the Directors present

should elect any one among themselves to chair such Meeting.

• If there is only one Director present at a Meeting and he is wil ing to act

as Chairman, he may chair the Meeting with the consent of the

Members present.

• If no Director is present within fifteen minutes or if none of the Directors

is wil ing to take the chair, the Members present should elect any one

among themselves to chair the Meeting.

The election of the Chairman, as aforesaid, should in the first instance be

made by a show of hands. The person elected as Chairman on a show of

hands should preside over the Meeting and commence the proceedings of the

Meeting.

GUIDANCE NOTE ON GENERAL MEETINGS

57

Articles to be complied with

If the Articles contain a provision as to who should be the Chairman of the

Meeting and the procedure for the election of the Chairman, the same should

be complied with.

Effect of MCA Notification

In case of a private company, appointment of the Chairman shal be in

accordance with this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

election of the Chairman of General Meetings. In such a case, the election of

the Chairman should be done as provided in the Articles [In line with MCA

Notification No. G.S.R. 464(E) dated June 5, 2015].

Demand for pol on the election of Chairman

If a pol is demanded on the election of the Chairman, it shal be taken forthwith

in accordance with the provisions of the Act and the Chairman elected on a

show of hands shall continue to be the Chairman of the Meeting until some

other person is elected as Chairman as a result of the pol , and such other

person shall be the Chairman for the rest of the Meeting.

Chairman of the adjourned Meeting

Since an adjourned Meeting is a continuation of the original Meeting, the

Chairman of the original Meeting should be the Chairman of the adjourned

Meeting unless he is unable or unwil ing to act as such or is validly removed

as Chairman at the Meeting. In such case, the procedure of election of Chairman

should be fol owed to elect a new Chairman to preside at the Meeting. If the

Chairman of the Board was not present to chair the original Meeting but is

present at the adjourned Meeting, then he should take the chair at the adjourned

Meeting.

Duty of the Chairman

The Chairman shall ensure that the Meeting is duly constituted in accordance

with the Act and the Articles or any other applicable laws, before it proceeds

to transact business. The Chairman shal then conduct the Meeting in a fair

and impartial manner and ensure that only such business as has been set

out in the Notice is transacted. The Chairman shal regulate the manner in

which voting is conducted at the Meeting keeping in view the provisions of

the Act.

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GUIDANCE NOTE ON GENERAL MEETINGS

It is the duty of the Chairman to preserve order at the Meeting and to conduct

the proceedings in a proper manner.

5.2 The Chairman shal explain the objective and implications of the

Resolutions before they are put to vote at the Meeting.

Even though Resolutions forming part of “Special Business” are accompanied

by an explanatory note, the Chairman should, at the Meeting, explain the

objective and implications of each such Resolution in simple language for the

convenience of Members present at the Meeting so that they may make

informed decisions after understanding the meaning, scope and implications

of the concerned items of business. For this purpose, the Chairman may take

the assistance of the Company Secretary or any other Director or officer of the

company in order to do so, if required.

Chairman may explain developments if any subsequent to the posting of Notice

if such developments constitute a material fact. Any omission to state a material

fact in the Statement of Material Facts which gets noticed subsequently could

also be explained at the Meeting.

The Chairman shall provide a fair opportunity to Members who are entitled to

vote to seek clarifications and/or offer comments related to any item of business

and address the same, as warranted.

The Chairman should provide an opportunity to Members to raise questions

relating to the agenda items and ensure that Members who have sought any

clarifications, information or explanations, are given an effective and timely

response.

The Chairman should act fairly and allow all Members who wish to speak on

a motion to have a reasonable opportunity to do so, even if there appears to be

clear majority who have already made up their mind on the agenda item. The

Chairman has no right to prevent discussion upon a matter which is included

in the Notice convening a Meeting [S.Rm.S.T. Narayana Chettiar v. The

Kaleeswarar Mil s Ltd. (1951) 21 Comp. Cas. 351 (Mad)].

The Chairman can, however, restrict repetitive questions and limit the amount

of debate permitted on each Resolution. For this purpose, the company may

invite Members to submit questions in advance. The company may select the

common questions and provide a comprehensive answer for each of these at

the General Meeting.

For the purpose of answering any question, the Chairman may consult the

GUIDANCE NOTE ON GENERAL MEETINGS

59

Company Secretary, Key Managerial Personnel or other officers of the company,

the Auditors, Secretarial Auditors, etc.

5.3 In case of public companies, the Chairman shal not propose any

Resolution in which he is deemed to be concerned or interested

nor shal he conduct the proceedings for that item of business.

The Chairman is expected to act in good faith and in an impartial manner and

not to put his own interests ahead of or in conflict with those of the company. In

line with this principle, in case of public companies, the Chairman should

neither propose, any Resolution in which he is deemed to be concerned or

interested nor conduct the proceedings for such item of business.

If the Chairman is interested in any item of business, without prejudice to his

Voting Rights on Resolutions, he shall entrust the conduct of the proceedings in

respect of such item to any Non-Interested Director or to a Member, with the

consent of the Members present, and resume the Chair after that item of

business has been transacted.

6. Proxies

6.1 Right to Appoint

A Member entitled to attend and vote is entitled to appoint a Proxy, or

where that is al owed, one or more proxies, to attend and vote instead of

himself and a Proxy need not be a Member.

A Proxy may be described as the agent appointed by a Member to act on his

behalf at the Meeting [Lord Hansworth in Cousins v. International Brick Co. Ltd.

(1932) 2 Comp. Cas. 108 (CA)].

Every Member has a right to appoint any person as a Proxy to attend and vote

at a General Meeting [Sub–section (1) of Section 105 of the Act].

Members of certain class or classes of companies as may be specified by the

Central Government shall not be entitled to appoint any other person as a

proxy [Third Proviso to sub–section (1) of Section 105 of the Act].

Accordingly, in case of companies incorporated under Section 8 of the

Companies Act, 2013 , the Member is not entitled to appoint any other person

as his Proxy unless such other person is also a Member of such company

[Rule 19(1) of the Companies (Management and Administration) Rules, 2014].

Thus, a Proxy need not be a Member of the company, except in the case of

companies incorporated under Section 8 of the Companies Act, 2013.

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GUIDANCE NOTE ON GENERAL MEETINGS

Number of Proxies

A Member may name one or more “alternate” individuals to be appointed as

his Proxy to act as substitutes when the first named Proxy holder cannot attend

the Meeting.

A Proxy can act on behalf of Members not exceeding fifty and holding in the

aggregate not more than ten percent of the total share capital of the company

carrying Voting Rights.

However, a Member holding more than ten percent of the total share capital of

the company carrying Voting Rights may appoint a single person as Proxy for

his entire shareholding and such person shal not act as a Proxy for another

person or shareholder.

If a Proxy is appointed for more than fifty Members, he shal choose any fifty

Members and confirm the same to the company before the commencement of

specified period for inspection. In case, the Proxy fails to do so, the company

shall consider only the first fifty proxies received as valid.

A Proxy should be in favour of an individual.

Il ustration 1

Say, 32 Members appoint a single person as Proxy and one more Member

(i.e. 33rd Member) also appoints the same person as Proxy. Here, by the

addition of the 33rd member, if the shareholding exceeds the threshold of

ten percent of total share capital, the Proxy can act only for the 32

members.

Il ustration 2

Mr. A holds 10% of the total share capital of the Company and appoints

Mr. B as the proxy holder. Mr. B cannot accept appointment as proxy by

any other shareholder.

Il ustration 3

Mr. C has been appointed as the proxy holder by 48 members. Mr. D, Mr.

E and Mr. F are also interested in appointing Mr. C as their proxy. Mr. C

cannot be appointed as proxy by more than 50 members and hence he

can accept appointment only by 2 members out of the three (i.e. Mr. D,

Mr. E and Mr. F). However, the aggregate shareholding of the 50 members

should not exceed 10% of the total share capital of the Company.

GUIDANCE NOTE ON GENERAL MEETINGS

61

Il ustration 4

Mr. X holds 20% of the total share capital of the Company carrying voting

rights. He may appoint a single person as proxy for his entire

shareholding and such proxy cannot act as proxy for any other

shareholder.

Competence of an Artificial Person to appoint a Proxy

A Proxy may be appointed by both natural and artificial persons competent in

law to act as principals.

The Proxy holder should have the legal capacity to act as an agent. A Proxy,

when it refers to the person appointed as a Proxy, should always be a natural

person. The words “to attend” and “to vote” implicitly make it clear that such

acts can be done only by a natural person. Section 113 of the Act makes it

clear that a body corporate can appoint an authorised representative to attend

and vote including the right to vote by Proxy and the words “as that body

could exercise if it were an individual Member, creditor or holder of

debentures of that company” makes it clear that the act of attending and

voting at General Meetings has to be done only by individuals who are

natural persons.

Appointment of Proxy by a Preference Shareholder

Where a preference shareholder has a right to vote on a particular Resolution,

he has the right to appoint a Proxy to vote on the said Resolution. Further, the

same person may be appointed as Proxy by more than one preference

shareholder and, in such a case, if one Preference shareholder instructs the

Proxy to vote in one way while another Preference shareholder instructs the

Proxy to vote in a different way, the Proxy shal act in accordance with such

instructions.

Appointment of Proxy by a Member who has already voted through Remote

e-voting

A Member who has already cast his vote through Remote e-voting may appoint

a Proxy to attend the Meeting instead of himself, but such Proxy wil not be

able to cast his vote at the Meeting.

Appointment of Proxy in case of a company not having a share capital

In the case of a company not having share capital, the Articles may contain a

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GUIDANCE NOTE ON GENERAL MEETINGS

provision stating that a Proxy has no right to speak and that a Proxy need not

be a Member and also that a Proxy cannot vote, except on a pol .

Unless otherwise provided in the Articles, sub-section (1) of the Section 105 of

the Act shall not apply in case of a company not having a share capital.

While the provisions for appointment of Proxy apply in relation to companies

that have share capital, even companies that do not have share capital may

make such provision through their Articles.

Right of a Proxy

First proviso under sub-section (1) of Section 105 of the Act says that a Proxy has

no right to speak and is not entitled to vote except on a pol .

Effect of MCA Notification

In case of a private company, the proxy shall be appointed in accordance with

this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain provisions as to various

aspects of Proxies. In such a case, the Articles should be complied with [In line

with MCA Notification No. G.S.R. 464(E) dated June 5, 2015].

6.2 Form of Proxy

6.2.1 An instrument appointing a Proxy shall be in the Form

prescribed under the Act.

Such instrument shall not be questioned on the ground that it fails to comply

with any special requirements specified by the Articles of a company.

The instrument of Proxy shall be signed by the appointer or his attorney duly

authorised in writing, or if the appointer is a body corporate, be under its seal

or be signed by an officer or an attorney duly authorised by it.

The Proxy form should be in writing [Clause (a) of sub-section (6) of Section 105

of the Act].

An instrument appointing a Proxy should be in Form No. MGT-11 [Rule 19 of the

Companies (Management and Administration) Rules, 2014].

If an instrument appointing a Proxy is in Form No. MGT-11, it shal not be

questioned on the ground that it fails to comply with any special requirements

specified for such instrument by the Articles of a company [Sub-section (7) of

Section 105 of the Act].

GUIDANCE NOTE ON GENERAL MEETINGS

63

6.2.2 An instrument of Proxy duly fil ed, stamped and signed, is

valid only for the Meeting to which it relates including any

adjournment thereof.

A Proxy given for the original Meeting is also valid for the adjourned Meeting.

6.3 Stamping of Proxies

An instrument of Proxy is valid only if it is properly stamped as per the

applicable law. Unstamped or inadequately stamped Proxies or Proxies

upon which the stamps have not been cancel ed are invalid.

The Indian Stamp Act, 1899 requires certain instruments to be stamped. If the

instrument is not stamped in accordance with the Indian Stamp Act, 1899, the

corresponding penalty, as mandated by the Act, would be levied.

An instrument of proxy is invalid, if it is not properly stamped as per the relevant

law related to stamping of various instruments. The Proxy should be stamped

before it is acted upon. A Proxy cannot be said to have been duly stamped and

executed if the stamp has been affixed over the signature of the Member.

Stamp duty on Proxies is uniform throughout the country [Article 246(1) of the

Constitution of India, read with Entry 91 of List I of Schedule VI ], and hence it is

immaterial whether or not the stamp affixed on the Proxy form bears the name

of a State. Similarly, a Proxy executed by a Member in one State, though having

the stamp of another State affixed on it, is valid [Firestone Tyre & Rubber Co. v.

Synthetics and Chemicals (1971) 41 Comp. Cas. 377 (Bom)].

Though under Section 18 of the Indian Stamp Act, 1899, an instrument other

than bil s and notes executed outside India can be stamped in accordance

with the duty payable under the Indian Stamp Act, 1899 within three months

from the date of its receipt in India, a Proxy executed outside India or within

India must be stamped prior to depositing the same with the company.

A vote cast on an unstamped Proxy is invalid [In Re. Tata Iron and Steel Co. Ltd.

AIR 1928 Bom 80].

6.4 Execution of Proxies

6.4.1 The Proxy-holder shall prove his identity at the time of

attending the Meeting.

Proper details of name and folio number of the Member should be entered on

the Proxy form in order to facilitate related identification.

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GUIDANCE NOTE ON GENERAL MEETINGS

The Proxy-holder should also sign the Proxy form so as to enable the company

to verify that only such person as has been appointed by the Member, is

attending the Meeting and exercising rights on behalf of the Member. In

addition, to photo-identification of such Proxy–holder, his signature on the

Attendance Slip may also be matched by the company with his signature

appearing on the proxy form.

6.4.2 An authorised representative of a body corporate or of the

President of India or of the Governor of a State, holding shares

in a company, may appoint a Proxy under his signature.

The President of India or the Governor of a State, if he is a Member of a

company, may appoint such person as he thinks fit to act as his representative

at any Meeting of the company [Sub-section (1) of Section 112 of the Act]. Such

a person appointed for this purpose shall be deemed to be a Member of such

company and is entitled to exercise the same rights and powers as a Member

including right to vote by Proxy.

A Member of a company who is a body corporate may authorise by Resolution

of its Board, or other governing body, such person as it thinks fit to act as its

representative at any Meeting of such company [Section 113 of the Act]. Such a

person appointed as a representative is entitled to exercise the same rights

and powers of a Member, including the right to vote by Proxy.

6.5 Proxies in Blank and Incomplete Proxies

In case there is any objection to the validity of a Proxy, the Chairman is entitled

to take a decision on that question.

Authority of Chairman on validity of Proxy

Without prejudice to the above statutory requirements, the Chairman shal be

the final authority to decide on the validity of the Proxy.

It is for the Chairman to decide the validity of the proxies and his decision in

this regard wil stand unless the contrary is proved [Dawson v. Hormasji AIR

1932 Rang 154]. The validity of the Proxies cannot be decided by scrutinisers.

6.5.1 A Proxy form which does not state the name of the Proxy

shal not be considered valid.

The executor of the Proxy should state the name of the Proxy in the form. A

Proxy form, though duly signed, should not be acted upon unless it bears the

name of the Proxy.

GUIDANCE NOTE ON GENERAL MEETINGS

65

6.5.2 Undated Proxy shal not be considered valid.

A space should be provided in the Proxy form for dating such form and, if the

date is not inserted, the Proxy should be deemed to be invalid, even if it is

otherwise complete in all aspects and has been received within the prescribed

time.

6.5.3 If a Company receives multiple Proxies for the same holdings

of a Member, the Proxy which is dated last shal be considered

valid; if they are not dated or bear the same date without

specific mention of time, al such multiple Proxies shal be

treated as invalid.

Il ustration

Assume that the General Meeting of a company is scheduled on 22nd

September 2017 and company has received 4 proxies for the same

holdings of a Member dated with 5th, 12th, 10th and 20th September 2017.

The proxy dated last should be considered valid i.e. 20th. However, if the

proxies received are not dated or bear the same date without mention of

time, al proxies should be treated as invalid.

6.6 Deposit of Proxies and Authorisations

6.6.1 Proxies shal be deposited with the company either in person

or through post not later than forty-eight hours before the

commencement of the Meeting in relation to which they are

deposited and a Proxy shal be accepted even on a holiday if

the last date by which it could be accepted is a holiday.

The above time limit of forty-eight hours affords the company an opportunity to

scrutinise proxies and for the Chairman to be advised on the validity thereof. It

also facilitates the taking of a pol , if any, as the company would be able to

compile the list of proxies lodged in favor of the various appointees with the

total number of votes which they represent, which in turn would facilitate the

processes of checking of proxies, pol ing, counting of votes, etc.

There is nothing in law to exclude Sundays in the computation of the forty-eight

hours and a Proxy delivered on a Sunday for a Meeting to be held forty-eight

hours later, on Tuesday, would be valid provided the receipt of the Proxy at the

time stated could be determined [K.P. Chackochan v. Federal Bank (1989) 66

Comp. Cas. 953 (Ker)].

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GUIDANCE NOTE ON GENERAL MEETINGS

The actual time of receipt of Proxy should be considered for determining its

validity irrespective of when the form was posted.

Any provision in the Articles of a company which specifies or requires a longer

period for deposit of Proxy than forty-eight hours before a Meeting of the company

shall have effect as if a period of forty-eight hours had been specified in or

required for such deposit.

Effect of MCA Notification

In case of a private company, the proxy shal be deposited with the company in

accordance with this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision for deposit

of proxies. In such a case, the Articles should be complied with [In line with

MCA Notification No. G.S.R. 464(E) dated June 5, 2015].

6.6.2 If the Articles so provide, a Member who has not appointed a

Proxy to attend and vote on his behalf at a Meeting may

appoint a Proxy for any adjourned Meeting, not later than

forty-eight hours before the time of such adjourned Meeting.

A Proxy may be appointed for an adjourned Meeting though the Member had

himself attended the original Meeting.

6.6.3 In case of remote e-voting:

(i) the letter of appointment of representative(s) of the

President of India or the Governor of a State; or

(i ) the authorisation in respect of representative(s) of the

Corporations;

shall be received by the scrutiniser/company on or before close of

e-voting.

In case of postal ballot such letter of appointment/ authorisation shall be

submitted to the scrutiniser alongwith physical ballot form.

If the representative attends the Meeting in person to vote thereat, the letter of

appointment/authorisation, as the case may be, shal be submitted before the

commencement of Meeting.

As provided by Article 77(1) and 166(1) of the Constitution, al executive actions

of the Government of India or the Government of a State shall be expressed to

be taken in the name of the President or the Governor, as the case may be. The

GUIDANCE NOTE ON GENERAL MEETINGS

67

acquisition or holding of shares in a company by the Government of India or a

State Government is “executive action” and can, therefore, be made in the

name of the President of India or the Governor of the State, as the case may be.

In view of the above, shares in a Government company can be held in the

name of the President of India or the Governor of a State [Department of Company

Affairs No.15/32/65-IGC dated 30th September 1966].

The President or the Governor of a State becomes a member of a company by

virtue of his position as executive head of the State. It may not be possible for

the President or the Governor to attend the Meetings of the company whose

shares are held in his name, therefore the Act specifical y permits their

authorised representatives in Meetings. Further, the Act also permits the

representation of corporations at the Meetings of a company.

The person so authorised to attend the meeting is entitled to exercise the same

rights and powers, as the President or Governor or the corporation could exercise

as an individual member of the company. However, such authorisation must

be valid and received by the company as stipulated in this Paragraph of SS-2.

6.7 Revocation of Proxies

A Proxy is in the same position as an agent and his authority to act may be

revoked in the same manner as that of an agent. Such authority continues

unless it is revoked.

The relationship between a shareholder and his Proxy is similar to that of

principal and agent. A Proxy can, any time, be revoked by the shareholder

[S.Rm.S.T. Narayana Chettiar v. Kaleeswarar Mil s Ltd. AIR 1952 Mad 515].

The revocation of Proxy can be divided into two categories:

(i) Implied revocation - when the Proxy is revoked by operation of law, it

is termed as implied revocation. In this case it is not necessary for a

Member to give an express Notice of revocation to the company.

(i ) Express revocation - when the Member expressly gives the Notice to

revocation of proxy to the company.

6.7.1 If a Proxy had been appointed for the original Meeting and

such Meeting is adjourned, any Proxy given for the adjourned

Meeting revokes the Proxy given for the original Meeting.

6.7.2 A Proxy later in date revokes any Proxy/Proxies dated prior

to such Proxy.

If a Member has given a Proxy and then, at a later date, gives another Proxy

68

GUIDANCE NOTE ON GENERAL MEETINGS

which is valid in al respects, the Proxy given earlier is automatically revoked.

However, where one Proxy was lodged before and the other after the expiry of

the date fixed for lodging proxies, the former would be accepted and the second

would be rejected.

6.7.3 A Proxy is valid until written notice of revocation has been

received by the company before the commencement of the

Meeting or adjourned Meeting, as the case may be.

Except in case of implied revocation, a Proxy is not revoked unless the

written Notice to that effect is received by the company before the

commencement of the Meeting or the adjourned or postponed Meeting, as

the case may be.

Revocation of Proxies cannot be assumed and written Notice of revocation

is necessary [Swadeshi Polytex Ltd. v. V.K. Goel (1988) 63 Comp. Cas. 688

(Del)].

The vote given by a Proxy is valid notwithstanding its revocation provided no

intimation in writing of the revocation is received by the company or by the

Chairman of the Meeting before the vote is cast [K.P. Chackochan v. Federal

Bank (1989) 66 Comp. Cas. 953 (Ker)].

A vote given in accordance with the terms of an instrument of Proxy shall be

valid, notwithstanding the previous death or insanity of the principal or the

revocation of the Proxy or of the authority under which the Proxy was executed

or the transfer of the shares in respect of which the Proxy is given. Provided

that no intimation in writing of such death, insanity, revocation or transfer should

have been received by the company at its office before the commencement of

the Meeting or adjourned Meeting at which the Proxy is used [Regulation 59 of

Table F to Schedule I to the Act].

However, if intimation of death or insanity of the Member has been given to the

company, a Proxy appointed by such Member wil be revoked.

An undated notice of revocation of Proxy shall not be accepted. A notice of

revocation shall be signed by the same Member(s) who had signed the Proxy,

in the case of joint Membership.

6.7.4 When a Member appoints a Proxy and both the Member and

Proxy attend the Meeting, the Proxy stands automatical y

revoked.

The right of a Member to vote in person supersedes rights conferred by the

GUIDANCE NOTE ON GENERAL MEETINGS

69

grant of a Proxy to a Proxy-holder. Mere presence of the Member wil revoke

the Proxy.

It may be noted that the Member concerned should sign the attendance register

or deliver the attendance slip.

6.8 Inspection of Proxies

Before keeping open the proxies for inspection by Members, the Chairman

should decide on the validity or otherwise of the proxies lodged. If any objection

is raised after inspection by a Member, the Chairman may revise his decision.

6.8.1 Requisitions, if any, for inspection of Proxies shal be received

in writing from a Member entitled to vote on any Resolution

at least three days before the commencement of the Meeting.

Once a Proxy form has been deposited, it should be open to the inspection of

all persons entitled to vote. The right of inspection is a necessary corol ary to

the right to challenge the vote of any other Member. The object of inspection is

to enable Members to scrutinise the proxies filed and raise objections to the

validity of any of them.

The manner of inspection may be subject to restrictions.

6.8.2 Proxies shal be made available for inspection during the period

beginning twenty-four hours before the time fixed for the

commencement of the Meeting and ending with the conclusion

of the Meeting.

Every Member entitled to vote on any Resolution at a General Meeting is

entitled to inspect the proxies lodged (whether considered valid/invalid)with

the company, . The inspection should be al owed during the period starting

twenty-four hours before the time fixed for the commencement of the Meeting

and ending with the conclusion of the Meeting.

Inspection shal be al owed between 9 a.m. and 6 p.m. during such period.

Effect of MCA Notification

In case of a private company, inspection of proxies shall be as stated above,

unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

inspection of proxies. In such a case, the Articles should be complied with [In

line with MCA Notification No. G.S.R. 464(E) dated June 5, 2015].

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GUIDANCE NOTE ON GENERAL MEETINGS

6.8.3 A fresh requisition, conforming to the above requirements,

shal be given for inspection of Proxies in case the original

Meeting is adjourned.

As deposit of proxies is al owed even before the adjourned Meeting, a fresh

requisition for inspection of proxies should be filed in case the original Meeting

is adjourned.

6.9 Record of Proxies

6.9.1 All Proxies received by the company shall be recorded

chronological y in a register kept for that purpose.

Al proxies received by the company, irrespective of whether they are valid or

not, should be recorded.

As a good secretarial practice, the time of receipt may also be mentioned in

the register and on the Proxy itself.

6.9.2 In case any Proxy entered in the register is rejected, the

reasons therefor shal be entered in the remarks column.

If for any reason, a Proxy is rejected, the fact of and the reasons for such

rejection should be recorded on the Proxy itself and in the Register of Proxies.

7. Voting

Voting is a method by which the Meeting decides whether it approves or

disapproves the Resolution. It is a procedure which enables the Chairman to

ascertain the true sense of the Meeting on any Resolution put before it.

Only those Members entitled to vote either in person or, where permissible,

through authorised representative or Proxy, can participate in the voting

process. The voting process may be through show of hands, bal ot process,

e-voting or voting by postal bal ot. In order to be entitled to vote, the Member

concerned should be holding shares entitled to voting rights as on the cut-off

date or record date or any other date as the company would have specified

in the Notice of General Meeting. In certain cases, for instance, where

Regulation 55 of Table F of Schedule I to the Act applies, a Member wil not

be entitled to vote at any General Meeting unless al cal s or other sums

presently payable by him in respect of shares in the company have been

paid.

GUIDANCE NOTE ON GENERAL MEETINGS

71

7.1 Proposing a Resolution at a Meeting

Every Resolution, except a Resolution which has been put to vote through

Remote e-Voting or on which a pol has been demanded, shal be proposed

by a Member and seconded by another Member.

This Standard is relevant for a company which has not provided e-voting facility

to its Members and takes up the Resolution for consideration at the Meeting

directly.

In the case of a company which has provided e-voting facility, voting

commences much before a physically convened General Meeting is held.

Further, where a Pol is conducted at the Meeting, the Pol is ordered to be

taken up by the Chairman on his own motion or on a demand made in that

behalf. Hence, there is no need to propose and second the Resolution.

In such cases, it is not necessary to fol ow this conventional practice which

causes no harm if practiced. The Chairman shal have the discretion in requiring

proposing or seconding of the Resolution, while considering the same at the

Meeting.

A Proxy cannot speak and therefore he cannot propose or second a Resolution.

However, the position of an authorised representative of a body corporate is

different as discussed earlier in paragraph 3.1 and 3.2 and such a person is

entitled to propose and second a Resolution.

7.2 E-voting

7.2.1 Every company having its equity shares listed on a recognized

stock exchange other than companies whose equity shares

are listed on SME Exchange or on the Institutional Trading

Platform and other companies as prescribed shal provide e-

voting facility to their Members to exercise their Voting Rights.

Other companies presently prescribed are companies having not less than

one thousand Members.

Nidhis are not required to provide e-voting facility to their Members.

Every company having its equity shares listed on a recognised stock exchange

and every company having not less than one thousand members should provide

e-voting facility to its Members to exercise their voting rights. However, pursuant

to proviso to Rule 20(2) of the Companies (Management and Administration)

Rules, 2014 , a Nidhi or an enterprise or institutional investor referred to in

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GUIDANCE NOTE ON GENERAL MEETINGS

Chapter XB (companies listed on SME Exchange) or Chapter XC (companies

listed on Institutional trading platform) of the Securities and Exchange Board of

India (Issue of Capital and Disclosure Requirements) Regulations, 2009 are

exempt from providing e-voting facility.

The facility of Remote e-voting does not dispense with the requirement of

holding a General Meeting by the company.

It is mandatory to have a physical General Meeting in view of the fact that e-

voting is only a facility and it is not mandatory for the Members to use the

same. Members may stil prefer to attend the Meeting and exercise their voting

rights at such Meeting.

Therefore, a Meeting should be cal ed and held in the normal way with the

fulfil ment of al attendant factors such as a Quorum. In case the Quorum is not

present at the Meeting, such Meeting shal stand adjourned as per the

applicable provisions for want of Quorum and the fate of the Resolutions put

before such a Meeting would be decided at the adjourned Meeting.

If at adjourned Meeting also a Quorum is not present, the Members present

shall be the Quorum [Sub–section (3) of Section 103 of the Act]. It means even

if two Members are present, the Meeting wil be valid.

At an adjourned General Meeting, if only one Member is present, such

adjourned General Meeting shal stand cancel ed for want of a minimum of

two members to constitute a Meeting and the Resolution would fail, even if

Remote e-voting has taken place.

7.2.2 Voting at the Meeting

Every company, which has provided e-voting facility to its Members, shal

also put every Resolution to vote through a bal ot process at the Meeting.

Ballot process may be carried out by distributing ballot/pol slips or by making

arrangement for voting through computer or secure electronic systems.

Voting at the Meeting should be made available for Members through a ballot

process, which may be carried out by distributing ballot papers/pol slips or by

making arrangement for voting through computer or secure electronic systems.

Voting through a bal ot process at the Meeting is different from Demand for pol

under Section 109 of the Act and Paragraph 9 of SS-2.

The company may provide the same electronic voting system for the bal ot

process as used during Remote e-voting. In such cases, the said facility should

GUIDANCE NOTE ON GENERAL MEETINGS

73

be in operation til all the Resolutions are considered and voted upon in the

Meeting and may be used for voting only by the Members attending the Meeting

in person or through Proxy, and who have not exercised their right to vote

through Remote e-voting [Proviso to clause (vi i) of sub-rule (4) of Rule 20 of

Companies (Management and Administration) Rules, 2014 ].

It is not necessary for a Quorum to be present while the ballot process is being

conducted or when the scrutiniser is doing his job or when the result is

announced.

Any Member, who has already exercised his votes through Remote e-voting,

may attend the Meeting but is prohibited to vote at the Meeting and his vote, if

any, cast at the Meeting shal be treated as invalid.

A Proxy can vote in the ballot process.

7.3 Show of Hands

Every company shal , at the Meeting, put every Resolution, except a

Resolution which has been put to Remote e-voting, to vote on a show of

hands at the first instance, unless a pol is validly demanded.

A Resolution, in the first instance, should be put to vote on a show of hands. In

such case, each Member present in person has only one vote regardless of

the number of shares held by him.

A Resolution put to vote at the General Meeting should be decided on show of

hands provided no pol is demanded under Section 109 of the Act, or no facility

of Remote e-voting is provided [Sub-section (1) of Section 107 of the Act].

In view of the provisions of Section 107 of the Act, voting by show of hands is

not permitted in cases where Rule 20 of Companies (Management and

Administration) Rules, 2014 is applicable. Rule 20 deals with voting through

electronic means.

In Remote e-voting, the voting rights of a Member are determined on the basis

of his share in the paid up equity share capital or on the basis of his share in

the paid up preference share capital, as the case may be and he need not

necessarily use all his votes in favour or against and may use some votes in

favour and some against the same Resolution. However, in a voting by show

of hands, every Member shal have only one vote. Therefore, the practice of

voting by show of hands is incompatible with Remote e-voting [Vide MCA

Circular No. 20/2014 dated 17th June, 2014].

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GUIDANCE NOTE ON GENERAL MEETINGS

A Proxy cannot vote on a show of hands.

Proxies are not entitled to vote when a Resolution is put to vote on a show of

hands.

Representatives of bodies corporate, or of the President of India or of Governors

of States, holders of powers of attorney, guardians of minors and Kartas of

HUFs should be treated as Members personal y present for the purposes of

voting on show of hands [Section 112 & Section 113 of the Act].

Procedure for voting on show of hands

When the Chairman puts a Resolution to vote on a show of hands, he should

first request those Members who are in favour of the Resolution to raise their

hands. Thereafter, he should request those Members who are against the

Resolution to raise their hands.

On counting–

(a) in the case of an Ordinary Resolution, if the number of hands raised in

favour of the Resolution exceeds the number of hands raised against,

the Resolution can be said to have been passed.

(b) in the case of a Special Resolution, if the number of hands raised in

favour of the Resolution is at least three times the number of hands

raised against the Resolution, the Special Resolution can be said to

have been passed.

The Chairman should ascertain if the Resolution has been carried through with

the requisite majority of votes in favour of the Resolution. In case of any doubt,

he should order a pol to ascertain the same.

On completion of voting on a show of hands, the Chairman should declare the

result by announcing that the Resolution has been passed by the requisite

majority or that such Resolution has not been passed.

The result of voting so declared by the Chairman should subsequently be

recorded in the Minutes of the Meeting and such record shal be conclusive

evidence of the fact that the Resolution has been passed or not, and no further

proof of the number of votes cast for or against the Resolution should be

necessary.

When voting takes place by show of hands, declaration by the Chairman as to

the result of voting is conclusive evidence that the Resolution was passed or not

passed, as the case may be [E.D. Sasoon United Mil s, Re AIR 1929 Bom 38].

GUIDANCE NOTE ON GENERAL MEETINGS

75

However, this may not be so in the fol owing two cases:

(a) when a pol is demanded [Anthony v. Seger (1789) 1 HAG CON 13 ]; and

(b) when the declaration is without taking a count of the number or

proportion of the votes recorded in favour or against the Resolution

[Dhakeshwari Cotton Mil s Ltd. v. Nil Kamal Chakravarthy and Others

(1937) 7 Comp. Cas. 417 (Cal)].

If Members or Proxy holders having requisite percentage of shareholding/

voting power, as the case may be, demand a pol , it becomes the duty of the

Chairman to order a pol .

Any objection as to the result declared on show of hands, should be made at

once, i.e. the Chairman’s ruling that a Resolution has been carried on show of

hands should be chal enged at that very time. It cannot be chal enged

subsequently [Arnot v. United African Lands Ltd. (1901) 1 Ch 518 (CA)].

Effect of MCA Notification

In case of a private company, the voting by show of hands shall be in

accordance with this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

voting by show of hands at the General Meetings. In such a case, the Articles

should be complied with [In line with MCA Notification No. G.S.R. 464(E) dated

June 5, 2015].

7.4 Pol

The Chairman shal order a poll upon receipt of a valid demand for pol

either before or on the declaration of the result of the voting on any

Resolution on show of hands.

Before or on the declaration of the result of the voting on any Resolution put to

vote on a show of hands, a pol should be ordered to be taken by the Chairman

on a demand made in that behalf –

(a) in the case a company having a share capital, by the Members present

in person or by Proxy, where allowed, and having not less than one-

tenth of the total voting power or holding shares on which an aggregate

sum of not less than rupees five lakh has been paid up; and

(b) in the case of any other company, by any Member or Members present

in person or by Proxy, where allowed, and having not less than one-

tenth of the total voting power.

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GUIDANCE NOTE ON GENERAL MEETINGS

A pol demanded should be taken within forty eight hours from the time when

demand was made, except on the question of adjournment of the Meeting or

appointment of Chairman which should be taken forthwith [Sub-sections (3)

and (4) of Section 109 of the Act].

A pol can be demanded even before declaration of result of voting on a show

of hands. A specimen of a demand for pol is placed at Annexure X.

In case of demand for pol , the Chairman should act bona fide and ascertain

the wishes of the Members [Second Consolidated Trust Ltd. v. Ceylon

Amalgamated Tea and Rubber Estates Ltd. (1943) 2 Al ER 567].

The Company should use the Form MGT-12 as the pol ing paper for conducting

the pol .

The pol may be taken by the Chairman, on his own motion also.

The Chairman may, on his own motion, order a pol before or on the declaration

of the result of voting on a show of hands [Sub-section (1) of Section 109 of the

Act].

Pol in such cases shall be through a Bal ot process.

While a Proxy cannot speak at the Meeting, he has the right to demand or join

in the demand for a pol .

Effect of MCA Notification

In case of a private company, the pol shall be conducted in accordance with

this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

demand for pol at the General Meetings. In such a case, the pol should be

conducted as provided in the Articles [In line with MCA Notification No. G.S.R.

464(E) dated June 5, 2015].

7.5 Voting Rights

7.5.1 Every Member holding equity shares and, in certain cases as

prescribed in the Act, every Member holding preference

shares, shal be entitled to vote on a Resolution.

Whether it is a Meeting called under the authority of the Board or in pursuance

of a requisition of eligible Members, only those persons who are entitled to

vote on a Resolution should vote.

GUIDANCE NOTE ON GENERAL MEETINGS

77

Every Member entitled to vote on a Resolution and present in person shall, on

a show of hands, have only one vote irrespective of the number of shares held

by him.

A Member present in person or by Proxy shal , on a pol or bal ot, have votes

in proportion to his share in the paid up equity share capital of the company,

subject to differential rights as to voting, if any, attached to certain shares as

stipulated in the Articles or by the terms of issue of such shares.

Preference shareholders have a right to vote only in certain cases as prescribed

under the Act.

In e-voting or ballot process at the General Meeting, the number of votes cast

in favour or against should be reckoned on the basis of the Member’s share in

the paid-up capital of the company, and the Chairman of the Meeting should

regulate the Meeting accordingly.

A company may, if so authorised by its Articles, accept from any Member, the

whole or a part of the amount remaining unpaid on any shares held by him,

even if no part of that amount has been called up. A Member of the company

limited by shares shal not be entitled to any voting rights in respect of the

amount paid by him on any shares held by him until that amount has been

cal ed up [Section 50 of the Act].

Entitlement to vote:

Equity Shareholders

One of the basic rights of a Member is to attend and vote at General Meetings

of the company and normally anyone whose name is borne on the Register of

Members of the company on the date of the General Meeting is entitled to

attend the Meeting and vote, irrespective of when he became a Member.

Thus, every Member whose name appears on the Register of Members on the

day of the General Meeting has the right to attend and vote at the General

Meeting.

However, this position wil not hold good in cases where Remote e-voting

facility has been provided.

In cases where facility of Remote e-voting has been provided, only those

Members whose names are recorded in the Register of Members of the

company as on the cut-off date wil be entitled to vote at the Meeting.

Cut-off date means a date not earlier than seven days before the date of

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GUIDANCE NOTE ON GENERAL MEETINGS

General Meeting for determining the eligibility to vote by electronic means or

in the General Meeting.

If conversion of debenture into shares has taken place prior to the cut-off date,

such shareholders are entitled to attend and vote on the Resolution placed

before a General Meeting. However, if conversion has taken place after the

cut-off date but before the General Meeting, such shareholders may attend the

Meeting with the right to speak but without any voting rights.

Preference Shareholders

A preference shareholder has a right to vote only in the fol owing cases:

1. On Resolutions placed before the company which directly affects the

rights attached to his preference shares.

2. On any Resolution for the winding up of the company or for the

repayment or reduction of its equity or preference share capital.

3. On al Resolutions if dividend on the preference shares has not been

paid for a period of two years or more [Second proviso to sub-section

(2) of Section 47 of the Act]. If dividend default as aforesaid pertains

only to a class of preference shares, it is only the holders of such class

of preference shares who wil have voting rights as aforesaid on al

Resolutions placed before the company.

While under the Companies Act, 1956 there was a difference between

cumulative preference shares and non-cumulative preference shares with

respect to voting rights, there is no such distinction between those two types of

preference shares under the Act.

The voting rights of a preference shareholder on a pol should be in proportion

to his shares in the paid-up preference share capital of the company.

Where the preference shareholders are entitled to vote, the proportion of the

voting rights of equity shareholders to the voting rights of the preference

shareholders shall be in the same proportion as the paid-up capital in respect

of the equity shares bears to the paid-up capital in respect of the preference

shares [First Proviso to the Section 47 (2) of the Act].

Joint-holders

Unless otherwise provided in the Articles, any one of two or more joint

holders may vote at a Meeting either personal y or by Proxy in respect of

such shares as if he was solely entitled thereto and if more than one of

GUIDANCE NOTE ON GENERAL MEETINGS

79

such joint holders is present personal y or by Proxy or by attorney, then that

one of such persons so present whose name stands first or higher on the

Register of Members in respect of such shares shall alone be entitled to

vote in respect thereof. However, any other joint holder shal be entitled to

be present at the Meeting.

In the case of joint shareholding, vote of the senior, whether in person or by

Proxy, should be accepted to the exclusion of the votes of the other joint holders.

For this purpose seniority wil be determined by the order in which the names

stand in the Register of Members [Regulation 52 of Table F of Schedule I to the

Act].

Cal s in arrears

The Articles of the company may provide that no Member shall exercise any

voting rights in respect of any shares registered in his name on which any calls

or other sums presently payable by him have not been paid or in regard to

which the company has exercised any right of lien [Sub-section (1) of Section

106 of the Act].

Persons of unsound mind

A Member of unsound mind, or in respect of whom an order has been made

by any Court having jurisdiction in lunacy, may vote, whether on a show of

hands or on a pol , by his committee or other legal guardian, and any such

committee or guardian may, on a pol , vote by Proxy [Regulation 53 of Table F

of Schedule I to the Act].

Minors

Minors are entitled to vote at Meetings, both on a show of hands and on a pol

through their guardians only.

Insolvent Member

An insolvent Member is entitled to exercise his voting rights, which are attributed

to his status as a Member, so long as his name remains on the Register of

Members of the company as a Member.

Hindu Undivided Family

A Hindu Undivided Family [HUF], in respect of shares held by it, can participate

in the voting process through its Karta or any other adult Member of the HUF

duly authorised by the Karta.

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GUIDANCE NOTE ON GENERAL MEETINGS

Bodies corporate/President of India/Governors of States

Bodies corporate or the President of India and Governors of States can

participate in the voting process by representatives appointed by them or through

the proxies of such representatives [Section(s) 112 and 113 of the Act].

Effect of MCA Notification

In case of a private company, the voting rights shall be reckoned in accordance

with this para, unless otherwise provided in the Memorandum or Articles of

the company.

Private companies are exempted from Section 43 and Section 47 of the Act,

where the Memorandum or Articles so provide [MCA’s Notification No. 464(E)

dated June 5, 2015]. Therefore private companies may make different provision

in the Articles as far as kinds of share capital and voting rights are concerned.

In such cases the voting rights shal be reckoned in accordance with the Articles.

In case of a Nidhi, no Member shal exercise voting rights on pol in excess of

five per cent of total voting rights of equity shareholders.

7.5.2 A Member who is a related party is not entitled to vote on a Resolution

relating to approval of any contract or arrangement in which such Member

is a related party.

Specific related party transactions provided in Section 188 of the Act read with

the Rule 15(3) of the Companies (Meetings of the Board and its Powers) Rules,

2014, which are not in the ordinary course of business or not on an arm’s

length basis, would need prior approval of Members at a General Meeting.

Where any Member is a related party, such a Member is not entitled to vote on

the Resolution relating to such contract or arrangement provided such Member

is a related party in the context of the contract or arrangement that is being

specifical y approved at the General Meeting.

Regulation 18(1)(d) of Listing Regulations

Al entities falling under the definition of related parties as per LODR and

Companies Act, 2013, shall abstain from voting, irrespective of whether

the entity is a party to the particular transaction or not.

Exemptions

Transactions arising out of Compromises, Arrangements and Amalgamations

GUIDANCE NOTE ON GENERAL MEETINGS

81

dealt with under specific provisions of the Act wil not attract the requirements

of Section 188 of the Act [General Circular No. 30/2014 dated 17th July 2014].

Transactions entered into between a holding company and its whol y owned

subsidiary are exempted from the requirement of shareholder’s approval under

Section 188 of the Act, if the accounts of such whol y owned subsidiary have

been consolidated with the holding company and placed before the shareholders

at the General Meeting for approval.[Companies (Amendment) Act, 2015 with

effect from 29th May, 2015].

Further, in case of a transaction between the holding company and its whol y

owned subsidiary where the accounts of the subsidiary are not consolidated

with the holding company, the resolution passed by the holding company shal

be sufficient for the purpose of entering into the transaction between the whol y

owned subsidiary and the holding company.

Such transactions therefore wil not attract the requirements of this paragraph

of SS-2.

Chairman – A related party

If the Chairman is a related party in respect of a Resolution relating to approval

of a contract or arrangement, he should entrust the conduct of the proceedings

in respect of such item to any dis-interested Director or to a Member, with the

consent of the other Members present, and resume the chair after that item of

business in which he is a related party has been transacted.

Effect of MCA Notification

In case of a private company, a member who is a related party is entitled

to vote on such Resolution.

In case of a private company, a Member who is a related party may vote on a

Resolution relating to approval of any contract or arrangement in which such

Member is a related party [In line with MCA Notification No. G.S.R. 464(E) dated

June 5, 2015].

A member who is a related party is entitled to vote on a Resolution pertaining

to approval of any contract or arrangement to be entered into by:

(a) A Government company with any other Government company; or

(b) An unlisted Government company with the prior approval of

competent authority, other than those contract or arrangements

referred in clause (a).

[In line with MCA Notification No. G.S.R. 463(E) dated June 5, 2015]

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GUIDANCE NOTE ON GENERAL MEETINGS

7.6 Second or Casting Vote

Unless otherwise provided in the Articles, in the event of equality of votes,

whether on show of hands or electronical y or on a pol , the Chairman of

the Meeting shal have a second or casting vote.

A second or casting vote is a deciding vote. Second or Casting vote is the vote

of a Chairman of a Meeting which he can use in the event of a tie in voting, i.e.

equality of votes in favour of or against a Resolution. Second or casting vote is

different from the original vote of the Chairman as a Member and it can be

exercised only after the process of voting has been completed.

In case of a Board Meeting, the second or casting vote to the Chairman is

al owed by the Model Articles under the Act [Regulation 68 (i ) and 73 (i ) of

Table F of Schedule I to the Act]. To facilitate the decision making process, this

proposition is extended in case of General Meetings in line with Section 114

of the Act which provides for casting vote of the Chairman of a General

Meeting.

Accordingly, in the event of equality of votes on a particular matter at a General

Meeting, the Chairman can cast a second or casting vote on such matter

subject to any provision to the contrary in the Articles, provided he is a member

of the company.

Thus, the Articles of the company may expressly prohibit exercise of second or

casting vote by the Chairman, in such case, the Chairman shall not have a

second or casting vote. In case the Articles are silent, the Chairman may use

his discretion to have a second or casting vote.

The discretion to use or not to use his casting vote vests entirely with the

Chairman. If the Chairman declines to exercise his second or casting vote and

there is then an equality of votes, the Resolution is lost.

Where the Chairman chooses to exercise his vote as a member, he should do

so before the voting is concluded.

Where the Chairman has entrusted the conduct of proceedings in respect of an

item in which he is interested to any Non-Interested Director or to a Member, a

person who so takes the chair shal have a second or casting vote.

8. Conduct of e-voting

This paragraph of SS-2 would be applicable to those companies which have to

GUIDANCE NOTE ON GENERAL MEETINGS

83

provide the facility of Remote e-voting to their Members and to al those

companies that may provide such facility voluntarily.

8.1 Every Company that is required or opts to provide e-voting facility

to its Members shal comply with the provisions in this regard.

Every company which has listed its equity shares on a recognised stock

exchange and every company having not less than one thousand members

shall provide to its members facility to exercise their right to vote on resolutions

proposed to be considered at a general meeting by electronic means. A Nidhi,

or an enterprise or institutional investor referred to in Chapter XB or Chapter XC

of the Securities and Exchange Board of India (Issue of Capital and Disclosure

Requirements) Regulations, 2009 is not required to provide the facility to vote

by electronic means. [Rule 20(2) of the Companies (Management and

Administration) Rules, 2014 ]

Once a company voluntarily opts for e-voting, it should comply with-

(i) The e-voting rules made under the Act; and

( i ) The requirements of SS-2.

8.2 Every Company providing e-voting facility shal offer such facility to

al Members, irrespective of whether they hold shares in physical

form or in dematerialised form.

However such e-voting facility wil not be provided to those Members whose

voting rights are frozen by virtue of transfer of their shares to IEPF or to the

‘Unclaimed Suspense Account’ of the company.

8.3. The facility for Remote e-voting shal remain open for not less than

three days.

The voting period shal close at 5 p.m. on the day preceding the date of the

General Meeting.

Once the vote on a Resolution is cast by the Member, he should not be al owed

to change it subsequently or cast the vote again.

8.4 Board Approval

The Board shal :

(a) appoint one or more scrutinisers for e-voting or the bal ot process;

The scrutiniser(s) may be a Company Secretary in Practice, a Chartered

Accountant in Practice, a Cost Accountant in Practice, or an Advocate or any

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GUIDANCE NOTE ON GENERAL MEETINGS

other person of repute who is not in the employment of the company and who

can, in the opinion of the Board, scrutinise the e-voting process or the bal ot

process, as the case may be, in a fair and transparent manner.

Scrutiny of votes cast, either on e-voting or ballot process, envisages detailed

examination of the relevant records and calls for comprehensive knowledge

and competence to deal with the intricacies and technicalities involved. These

matters require professional knowledge, efficiency, fairness and transparency.

The scrutiniser(s) so appointed may take assistance of a person who is not in

employment of the company and who is well-versed with the e-voting system.

Prior consent to act as a scrutiniser(s) shall be obtained from the scrutiniser(s)

and placed before the Board for noting.

The scrutiniser should be wil ing to be appointed and be available for the

purpose of ascertaining the requisite majority [Rule 20(4)(x) of the Companies

(Management and Administration) Rules,2014].

(b) appoint an Agency;

An Agency should be appointed for providing and supervising the electronic

platform for e-voting.

(c) decide the cut-off date for the purpose of reckoning the names of

Members who are entitled to Voting Rights;

The cut-off date for determining the Members who are entitled to vote through

Remote e-voting or voting at the Meeting shall be a date not earlier than seven

days prior to the date fixed for the Meeting.

Only Members as on the cut-off date, who have not exercised their Voting

Rights through Remote e-voting, shal be entitled to vote at the Meeting.

8.5 Notice

8.5.1 Notice of the Meeting, wherein the facility of e-voting is provided,

shal be sent either by registered post or speed post or by courier

or by e-mail or by any other electronic means.

The Notice in case of e-voting should not be served through hand delivery or

ordinary post.

The provisions of sending Notice covered in paragraph 1.2.2 of SS-2 shall be

mutatis-mutandis applicable for the purpose of sending Notice, wherein the

facility of e-voting is provided.

GUIDANCE NOTE ON GENERAL MEETINGS

85

An advertisement containing prescribed details shal be published, immediately

on completion of despatch of notices for Meeting but atleast twenty one days

before the date of the General Meeting, at least once in a vernacular newspaper

in the principal vernacular language of the district in which the registered office

of the company is situated and having a wide circulation in that district and at

least once in English language in an English newspaper, having country-wide

circulation, and specifying therein, inter-alia the fol owing matters, namely:-

(a) A statement to the effect that the business may be transacted by e-

voting;

(b) The date and time of commencement of Remote e-voting;

(c) The date and time of end of Remote e-voting;

(d) The cut-off date as on which the right of voting of the Members shal

be reckoned;

(e) The manner in which persons who have acquired shares and become

Members after the despatch of Notice may obtain the login ID and

password;

(f) The manner in which company shall provide for voting by Members

present at the Meeting;

(g) The statement that

(i) Remote e-voting shal not be allowed beyond the said date and

time;

(i ) a Member may participate in the General Meeting even after

exercising his right to vote through Remote e-voting but shall not

be entitled to vote again; and

(i i) a Member as on the cut-off date shal only be entitled for availing

the Remote e-voting facility or vote, as the case may be, in the

General Meeting;

(h) website address of the company, in case of companies having a website

and Agency where Notice is displayed; and

(i) Name, designation, address, e-mail ID and phone number of the person

responsible to address the grievances connected with the e-voting.

Advertisement shall simultaneously be placed on the website of the company,

til the conclusion of Meeting, in case of companies having a website and of

the Agency.

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GUIDANCE NOTE ON GENERAL MEETINGS

Effect of MCA Notification

In the case of Nidhis, the Notice may be served only on Members who hold

shares of more than one thousand rupees in face value or more than one

percent of the total paid-up share capital of the company, whichever is less. For

other shareholders, Notice may be served by a public notice in newspaper

circulated in the district where the Registered Office of the Nidhi is situated; and

also be placed on the Notice Board of the company [In line with MCA Notification

No. G.S.R. 465(E) dated June 5, 2015].

8.5.2 Notice shal simultaneously be placed on the website of the

Company, in case of companies having a website, and of the

Agency.

Such Notice shall remain on the website til the date of General Meeting.

8.5.3 Notice shal inform the Members about procedure of Remote

e-voting, availability of such facility and provide necessary

information thereof to enable them to access such facility.

Notice shall clearly state that the company is providing e-voting facility and that

the business may be transacted through such voting.

Notice shal describe clearly the Remote e-voting procedure and the procedure

of voting at the General Meeting by Members who do not vote by Remote e-

voting.

The Notice of the Meeting should clearly state that the facility for voting, either

through electronic voting system or bal ot or pol ing paper, is being made

available at the Meeting and that Members attending the Meeting, who have

not already cast their vote by Remote e-voting, shall only be able to exercise

their voting right at the Meeting.

Notice shall also clearly specify the date and time of commencement and end

of Remote e-voting and contain a statement that at the end of Remote e-voting

period, the facility shal forthwith be blocked.

Notice shall also contain contact details of the official responsible to address

the grievances connected with voting by electronic means.

Notice shall clearly specify that any Member, who has voted by Remote e-

voting, cannot vote at the Meeting.

Notice shall also specify the mode of declaration of the results of e-voting.

GUIDANCE NOTE ON GENERAL MEETINGS

87

Notice shal also clearly mention the cut-off date as on which the right of voting

of the Members shal be reckoned and state that a person who is not a Member

as on the cut-off date should treat this Notice for information purposes only.

Notice shall provide the details about the login ID and the process and manner

for generating or receiving the password and for casting of vote in a secure

manner.

8.6 Declaration of results

8.6.1 The scrutiniser(s) shal submit his report within three days from

the date of the Meeting to the Chairman or a person authorised

by him, who shal countersign the same and declare the

result of the voting forthwith with details of the number of

votes cast for and against the Resolution, invalid votes and

whether the Resolution has been carried or not.

The scrutiniser(s) shal , immediately after the conclusion of voting at the

Meeting, first count the votes cast at the meeting, thereafter unblock the votes

cast through remote e-voting in the presence of at least two witnesses not in

the employment of the company and make, not later than three days of

conclusion of the meeting, a consolidated scrutiniser’s report of the total votes

cast in favor or against, if any, to the Chairman or a person authorised by him

in writing who shall countersign the same and declare the result of the voting

forthwith.

The manner in which Members have cast their votes, that is, affirming or

negating the Resolution or otherwise, should not be available to the Chairman,

scrutiniser or any other person til the votes are cast in the Meeting or voting at

the Meeting ends [Rule 20(4)(xii) of Companies (Management and

Administration) Rules, 2014].

The purpose of the requirement to maintain such confidentiality is to ensure

that no one is influenced by the manner in which votes have been cast by

those who have voted already.

Regulation 44(3) of Listing Regulations: Voting by Shareholders

Equity Listed Company should submit to the stock exchange, within forty

eight hours of conclusion of its General Meeting, details regarding the

voting results in the format specified for this purpose.

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GUIDANCE NOTE ON GENERAL MEETINGS

Regulation 30(6) of Listing Regulations: Disclosure of events or

information

Equity Listed Company should send a copy of the Proceedings of every

General Meeting to the stock exchange(s) within 24 hours of its conclusion.

Such Proceedings should include date of the Meeting, brief details of

item deliberated and results thereof and manner of approval proposed

for certain items (e-voting etc.).

8.6.2 The result of the voting, with details of the number of votes

cast for and against the Resolution, invalid votes and whether

the Resolution has been carried or not shal be displayed for

at least three days on the Notice Board of the company at its

Registered Office and its Head Office as well as Corporate

Office, if any, if such office is situated elsewhere. Further, the

results of voting alongwith the scrutiniser’s report shal also

be placed on the website of the company, in case of companies

having a website and of the Agency, immediately after the

results are declared.

Results of the voting should be displayed at the Registered Office of the company.

Such results should also be displayed at the Head Office as wel as the Corporate

Office of the company, if such offices are situated elsewhere i.e. at places other

than the Registered Office.

Placing of voting result on the website as wel as on the Notice Boards at the

Registered Office/ Head Office/ Corporate Office of the company is being

provided for wider coverage and for convenience of the Members who may

visit such offices.

In case of companies whose equity shares are listed on a recognised stock

exchange, the company should, simultaneously, forward the results to the

concerned stock exchange or exchanges where its equity shares are listed, for

placing the same on the website of such stock exchange(s) [Rule 20(4)(xvi) of

the Companies (Management and Administration) Rules,2014].

8.6.3 The Resolution, if passed by a requisite majority, shal be

deemed to have been passed on the date of the relevant

General Meeting.

For the purpose of this paragraph, the requisite number of votes should be the

votes required to pass the Resolution as an ‘Ordinary Resolution’ or a ‘Special

Resolution’, as the case may be, under Section 114 of the Act.

GUIDANCE NOTE ON GENERAL MEETINGS

89

Such majority would be determined after the voting at the relevant General

Meeting is over.

8.7 Custody of scrutinisers’ register, report and other related papers

The scrutinisers’ register, report and other related papers received from

the scrutiniser(s) shal be kept in the custody of the Company Secretary or

any other person authorised by the Board for this purpose.

The register and all other papers relating to voting by electronic means should

remain in the safe custody of the scrutiniser until the Chairman considers,

approves and signs the Minutes and thereafter, the scrutiniser should hand

over the register and other related papers to the company [Rule 20(4)(xv) of the

Companies (Management and Administration) Rules, 2014].

9. Conduct of Pol

9.1 When a pol is demanded on any Resolution, the Chairman shal

get the validity of the demand verified and, if the demand is valid,

shal order the poll forthwith if it is demanded on the question of

appointment of the Chairman or adjournment of the Meeting and,

in any other case, within forty-eight hours of the demand for pol .

A pol when validly demanded should be taken, even if the Chairman had

refused to grant the pol [M.K. Srinivasan and Others v. W. S. Subrahmanya

Aiyar and Others (1932) 2 Comp. Cas. 147].

Where the Chairman refused to order a pol even after a valid demand for pol

had been made, the business on the agenda for which the pol was demanded

and which was carried through by show of hands becomes invalid [Namita

Gupta v. Cachar Native Joint Stock Co. Ltd. (1999) 98 Comp. Cas. 655 (CLB)].

If a valid demand for pol is refused by the Chairman, the Meeting should

either be re-convened or a new Meeting should be convened to hold the pol

or to consider the item in respect of which the valid demand for pol was not

granted, as the case may be.

The result of the pol is deemed to be the decision of the Meeting on the Resolution

on which the pol was taken [Sub-section (7) of Section 109 of the Act].

Once a valid demand for a pol has been received, those who have made the

demand may withdraw it at any time. However, such withdrawal should be

made before the declaration of the results of the pol [Sub-section (2) of Section

109 of the Act].

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GUIDANCE NOTE ON GENERAL MEETINGS

Any business, other than that upon which a pol is demanded, can be

proceeded with, pending taking of the pol .

Where Resolutions are put to vote through Remote e-voting, pol cannot be

demanded on any Resolution, other than for adjournment of the Meeting or

election of Chairman of the Meeting.

9.2 In the case of a poll, which is not taken forthwith, the Chairman

shal announce the date, venue and time of taking the pol to enable

Members to have adequate and convenient opportunity to exercise

their vote. The Chairman may permit any Member who so desires

to be present at the time of counting of votes.

The Chairman has the power to fix and announce the date, time and place of

taking the pol and should exercise this power impartial y and reasonably so

as to ensure that all the Members of the company who wish to exercise their

vote have the opportunity to do so. The Chairman should, while deciding the

time and place of the pol , take into account the specific circumstances, the

nature and importance of the items of business to be put to vote and the

reasons for the demand for a pol .

However, the date on which pol wil take place should not be a National

Holiday.

The Meeting wil be deemed to conclude when voting by way of pol is

completed.

If the date, venue and time of taking the pol cannot be announced at the

Meeting, the Chairman shall inform the Members, the modes and the time of

such communication, which shall in any case be within twenty four hours of

closure of the Meeting.

A Member who did not attend the Meeting can participate and vote in the pol

in such cases.

Any mode of communication viz. public notice, advertisement through

newspaper, website of the company, e-mail etc. may be used for informing the

Members regarding the pol .

A specimen of the announcements to be made by the Chairman in connection

with a pol is placed at Annexure XI and the checklist for pol is placed at

Annexure XI .

In case of a private company, the demand and conduct of pol shal be as

stated above, unless otherwise provided in the Articles.

GUIDANCE NOTE ON GENERAL MEETINGS

91

In case of a private company, the Articles may contain a provision as to the

demand and conduct of pol . In such a case, the Articles should be complied

with [In line with MCA Notification No. G.S.R. 464(E) dated June 5, 2015].

9.3 Each Resolution put to vote by poll shal be put to vote separately.

One ballot paper may be used for more than one item.

Each Resolution on which a pol is demanded should be put to vote separately.

Al the Resolutions may, however, be included in one pol ing paper, to be

separately marked by the voters.

Form No. MGT-12 prescribed by MCA contains the form in which the pol ing

paper should be prepared.

9.4 Appointment of scrutinisers

The Chairman shal appoint such number of scrutinisers, as he deems

necessary, who may include a Company Secretary in Practice, a Chartered

Accountant in Practice, a Cost Accountant in Practice, an Advocate or any

other person of repute who is not in the employment of the company, to

ensure that the scrutiny of the votes cast on a pol is done in a fair and

transparent manner.

Scrutiny of votes cast on a pol envisages detailed examination of the relevant

records and calls for comprehensive knowledge and competence to deal with

the intricacies and technicalities involved. These matters require professional

knowledge, efficiency, fairness and transparency.

There is no bar on appointing any number of scrutinisers if the volume of work

involved warrants such appointments. The Chairman should use his discretion

in this regard and appoint such number of scrutinisers, as he deems necessary.

The same scrutiniser(s) appointed for remote e-voting and the ballot process at

the Meeting may be appointed for pol .

At any time before the result of the pol is declared, the Chairman has the

power, if circumstances warrant, to remove the scrutiniser from office. The

Chairman also has the power to fil the vacancy in the office of scrutiniser

arising from such removal or from any other cause.

In case of a private company, the appointment of scrutiniser(s) shall be in

accordance with this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

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GUIDANCE NOTE ON GENERAL MEETINGS

appointment of scrutiniser(s) in case of Pol . In such a case, the Articles should

be complied with [In line with MCA Notification No. G.S.R. 464(E) dated June 5,

2015].

9.5 Declaration of results

9.5.1 The scrutiniser(s) shal submit his report within seven days

from the last date of the pol to the Chairman who shal

countersign the same and declare the result of the pol within

two days of the submission of report by the scrutiniser, with

details of the number of votes cast for and against the

Resolution, invalid votes and whether the Resolution has been

carried or not.

In case Chairman is not available, for such purpose, the report by the scrutiniser

shall be submitted to a person authorised by the Chairman to receive such

report, who shall countersign the scrutiniser’s report on behalf of the Chairman.

Since the scrutiniser’s report and related papers are important documents,

authority to receive and countersign the same has been given to the Chairman

or any other person authorised by the Chairman. The idea is also to bring in

uniformity between the provisions of e-voting, pol and postal ballot in the Act

as far as receiving and countersigning of the scrutiniser’s report are concerned.

The scrutiniser should submit the report on the pol in Form No. MGT.13 within

seven days from the date the pol is taken. The report should be signed by the

scrutiniser and, in case there is more than one scrutiniser by al the scrutinisers.

The result shall be announced by the Chairman or any other person authorised

by the Chairman in writing for this purpose.

Where the pol has been conducted forthwith, the Chairman may declare the

result oral y at the Meeting.

The Chairman of the Meeting shal have the power to regulate the manner in

which the pol shal be taken and shall ensure that the pol is scrutinised in the

manner prescribed under the Act.

In case of a private company, the declaration of result of pol shall be in

accordance with this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

declaration of result of Pol . In such a case, the Articles should be complied

with [In line with MCA Notification No. G.S.R. 464(E) dated June 5, 2015].

GUIDANCE NOTE ON GENERAL MEETINGS

93

9.5.2 The result of the poll with details of the number of votes cast

for and against the Resolution, invalid votes and whether the

Resolution has been carried or not shal be displayed for at

least three days on the Notice Board of the company at its

Registered Office and its Head Office as well as Corporate

Office, if any, if such office is situated elsewhere, and in case

of public companies having a website, shal also be placed on

the website.

Results of the voting should be displayed in the Registered Of ice of the company.

Such results should also be displayed at the Head Office as well as Corporate

Office, if such offices are situated elsewhere i.e. other than where the Registered

Office is situated.

Placing of voting result on the website as wel as on the Notice Boards at the

Registered Office/ Head Office/ Corporate Office of the company is required

with the intent of wider coverage and for convenience of the Members who

may visit such offices.

9.5.3 The result of the poll shal be deemed to be the decision of

the Meeting on the Resolution on which the poll was taken.

The result of pol once declared shall be final. The decision as declared by the

Chairman should be recorded in the Minutes of the Meeting.

Specimen of the announcement of the result of pol is placed at Annexure XI I.

10. Prohibition on Withdrawal of Resolutions

Resolutions for items of business which are likely to affect the market

price of the securities of the company shal not be withdrawn. Further, any

Resolution proposed for consideration through e-voting shal not be

withdrawn.

A proposed Resolution likely to affect the market price of the securities of the

company should not be withdrawn once Notice has been issued. This is

because the subsequent withdrawal of such Resolutions may result in

movements in the market price of the securities of the company and may be

used for unfair gains. For example, Resolutions for issue of bonus shares or

rights shares or for buy-back of securities may have an impact on the share

price and the subsequent withdrawal of any such Resolution would adversely

affect those who may have taken any investment decisions based on such

information. Such Resolution should therefore, not be withdrawn.

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GUIDANCE NOTE ON GENERAL MEETINGS

Companies offering the facility of Remote e-voting should not withdraw any

Resolution once Notice has been issued [Rule 20(4)(xvi i) of the Companies

(Management and Administration) Rules, 2014].

11. Rescinding of Resolutions

A Resolution passed at a Meeting shal not be rescinded otherwise than by

a Resolution passed at a subsequent Meeting.

A Resolution rescinding an earlier Resolution should be passed in the same

manner in which the Resolution in question was passed, e.g. a Resolution

passed as a Special Resolution should be rescinded only by a Special Resolution

and a Resolution passed by voting through postal ballot should be rescinded

only by a Resolution passed by voting through postal bal ot.

Notice of such subsequent Meeting where the rescinding of a Resolution passed

earlier is proposed should specify the intention to rescind such Resolution.

Similarly, the Board should recommend to the General Meeting, rescinding of

the Resolution prior to such subsequent Meeting.

12. Modifications to Resolutions

Modifications to any Resolution which do not change the purpose of the

Resolution material y may be proposed, seconded and adopted by the

requisite majority at the Meeting and, thereafter, the modified Resolution

shal be duly proposed, seconded and put to vote.

No modification to any proposed text of the Resolution shal be made if it in any

way alters the substance of the Resolution as set out in the Notice. Grammatical,

clerical, factual and typographical errors, if any, may be corrected as deemed

fit by the Chairman.

Members present at a Meeting have a right to make modifications to a

Resolution provided that the modification is within the scope of the Notice

and the explanatory statement. However, the proposed modification should

not be so fundamental so as to destroy the intent of the original Resolution or

to alter its effect to a major degree, qualitatively or quantitatively. Similarly, a

modification which adds onerous conditions to a Resolution would not be

admissible.

The Chairman has no right to refuse to put before the Meeting an amendment

arising on an Ordinary Resolution which is contained in the Notice. If the

GUIDANCE NOTE ON GENERAL MEETINGS

95

Chairman improperly refuses to submit an amendment to the Meeting, the

Ordinary Resolution actually carried wil be invalidated [Henderson v. Bank of

Australasia (1890) 45 Ch D 330 (CA)].

No modification shall be made to any Resolution which has already been put

to vote by Remote e-voting before the Meeting.

Subject to the limitations mentioned above, Resolutions other than those

proposed through postal bal ot or Remote e-voting may be modified by the

majority of the Members present at the Meeting. However, shareholders do

not have power to increase the rate of the proposed dividend at the Meeting.

Procedure

The modification to a Resolution may be moved at any time after discussion on

the original Resolution has been called up, or during such discussion, but

before the original Resolution is voted upon.

In case two or more amendments are moved to a Resolution, the amendments

should be put to vote in the same order in which they were moved. Where the

amendments are accepted, they should be incorporated in the substantive or

main Resolution which then should be put to vote.

13. Reading of Reports

13.1 The qualifications, observations or comments or other remarks, if

any, mentioned in the Auditor’s Report on the financial transactions,

which have any adverse effect on the functioning of the company

shal be read at the Annual General Meeting and attention of the

Members present shal be drawn to the explanations / comments

given by the Board of Directors in their report.

The Chairman has to ensure that before any voting takes place at the Annual

General Meeting, the qualifications, observations or comments or other remarks

given in the Auditors’ report, which have any adverse effect on the functioning

of the company, are read out. Simultaneously, he has to ensure that the

explanations or comments given by the Board in its report on such qualifications,

observations or comments or other remarks of the Auditor are also read at the

Annual General Meeting.

It is not necessary that the Auditors themselves read out the Auditor’s Report.

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GUIDANCE NOTE ON GENERAL MEETINGS

13.2 The qualifications, observations or comments or other remarks, if

any, mentioned in the Secretarial Audit Report issued by the

Company Secretary in Practice, which have any material adverse

effect on the functioning of the company, shal be read at the Annual

General Meeting and attention of Members present shal be drawn

to the explanations / comments given by the Board of Directors in

their report.

The Chairman has to ensure that before any voting takes place at the Annual

General Meeting, the qualifications, observations or comments or other remarks

given in the Secretarial Auditors’ Report, which have any material adverse

effect on the functioning of the company, are read out. Simultaneously, he has

to ensure that the explanations or comments given by the Board in its report on

such qualifications, observations or comments or other remarks of the Secretarial

Auditor are also read at the Annual General Meeting.

This would enable the Members to know about the compliance and governance

aspects in the company and would enhance transparency.

It is not necessary that the Secretarial Auditors themselves read out the

Secretarial Auditor’s Report.

14. Distribution of Gifts

No gifts, gift coupons, or cash in lieu of gifts shal be distributed to Members

at or in connection with the Meeting.

No gifts, gift coupons, food coupons etc. or cash in lieu of gifts should be

distributed to the Members at the Meeting or in connection with the Meeting.

This is because such practice is discriminatory and favours only those Members

who attend the Meeting.

Further, any item or offer distributed with the intent to influence the decision of

the Members shal tantamount to distribution of gifts and should not be practiced.

However, offering, as a matter of courtesy, any food, snacks and beverages,

including packed food, at the venue of the Meeting, in the form of refreshments

to Members or Proxies who attend the Meeting physically would not amount to

offering of gifts.

Further, discount coupons or gift coupons which may be given by the company

with respect to its products or services, to all the Members, whether attending

the Meeting or not, would not amount to gift/coupon for the purpose of this

paragraph.

GUIDANCE NOTE ON GENERAL MEETINGS

97

15. Adjournment of Meetings

15.1 A duly convened Meeting shal not be adjourned unless circumstances

so warrant. The Chairman may adjourn a Meeting with the consent

of the Members, at which a Quorum is present, and shal adjourn

a Meeting if so directed by the Members.

Meetings shall stand adjourned for want of requisite Quorum.

The Chairman may also adjourn a Meeting in the event of disorder or other like

causes, when it becomes impossible to conduct the Meeting and complete its

business.

Adjournment means to defer or suspend the Meeting to a future time, either at

an appointed date or indefinitely or as decided by the Members present at the

scheduled Meeting.

A Meeting shall stand automatical y adjourned for want of requisite Quorum as

per the applicable provisions of the Act. The Chairman may adjourn a Meeting,

at which a Quorum is present in the fol owing circumstances:

(a) With the consent of the Members, when circumstances warrant, or

(b) In the event of disorder or like causes, or

(c) Where so directed by a majority of the Members.

The Chairman of a Meeting has an inherent power to adjourn the Meeting in

the event of disorder or like causes, if he acts bona fide and if the adjournment

was necessary for restoration of order.

The Chairman has the right to make a bona fide adjournment whilst a pol or

other business is proceeding, if circumstances of violent interruption make it

unsafe or seriously difficult for the Members to tender their votes. The question

wil turn upon the intention and effect of the adjournment; if the intention and

effect were to interrupt or delay the business, such an adjournment would be

il egal; if, on the contrary, the intention and effect were to forward or facilitate it

and no injurious effects would result, such an adjournment would generally be

supported [United Bank of India Ltd. v. United India Credit and Development

Corporation Ltd. (1977) 47 Comp. Cas. 689 (Cal)].

Demand of poll for adjournment of a Meeting

A pol may be demanded for adjournment of a Meeting and such pol shall be

taken forthwith [Sub-section (3) of Section 109 of the Act].

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GUIDANCE NOTE ON GENERAL MEETINGS

Other aspects related to adjournment

For a valid adjournment of a General Meeting, the holding of the Meeting at its

scheduled time is necessary. The Meeting may, however, be adjourned at any

time. It may be adjourned after some items of business have been transacted

and the remaining items can be transacted at the adjourned Meeting.

Difference between adjournment and postponement

A prerequisite to adjourn a meeting is to hold the meeting. Adjournment takes

places on the date of the meeting after the time at which meeting is scheduled

to be started.

Postponement takes place before the date and time of the meeting.

15.2 If a Meeting is adjourned sine-die or for a period of thirty days or

more, a Notice of the adjourned Meeting shall be given in

accordance with the provisions contained hereinabove relating to

Notice.

An adjourned Meeting is merely a continuation of the original Meeting and,

instead of sending a fresh Notice for the Meeting adjourned sine-die or for a

period of thirty days or more, the Notice of the original Meeting may be sent,

under cover of an intimation specifying the day, date, time and place of the

adjourned Meeting. The intimation should clarify that certain items of business

had been transacted at the original Meeting, state the reasons for adjournment

and list the remaining items of business to be transacted at the adjourned

Meeting. The relevant explanatory statement in respect of such remaining items

of business should also be given.

The Notice of adjourned Meeting should also be hosted at the website of the

company, if any.

15.3 If a Meeting is adjourned for a period of less than thirty days, the

company shal give not less than three days’ Notice specifying the

day, date, time and venue of the Meeting, to the Members either

individual y or by publishing an advertisement in a vernacular

newspaper in the principal vernacular language of the district in

which the registered office of the company is situated, and in an

English newspaper in English language, both having a wide circulation

in that district.

However, if a Meeting is adjourned for a period not exceeding three days

and where an announcement of adjournment has been made at the Meeting

GUIDANCE NOTE ON GENERAL MEETINGS

99

itself, giving in the details of day, date, time, venue and business to be

transacted at the adjourned Meeting, the company may also give Notice of

such adjourned Meeting either individual y or by publishing an advertisement,

as stated above.

An adjourned Meeting is merely a continuation of the original Meeting and, a

fresh Notice of the Meeting adjourned for a period of less than thirty days is to

be sent either individually or through an announcement in the newspapers,

giving details of the day, date, time and place and the business to be transacted

at the adjourned Meeting. Such announcement should also be placed on the

website, if any, of the company.

However, where the Meeting is adjourned for a period not exceeding three

days and an announcement in this regard has been made at the Meeting

itself, the company may opt to give Notice as stated above.

15.4 If a Meeting, other than an Annual General Meeting and a

requisitioned Meeting, stands adjourned for want of Quorum, the

adjourned Meeting shal be held on the same day, in the next

week at the same time and place or on such other day or at such

other time and place as may be determined by the Board.

If a Meeting is adjourned for want of a Quorum to the same day on the next

week, at the same time and place or with a change of day, time or place, the

company shal give not less than three days’ Notice specifying the day, date,

time and venue of the Meeting, to the Members either individually or by

publishing an advertisement in a vernacular newspaper in the principal

vernacular language of the district in which the registered office of the company

is situated, and in an English newspaper in English language, both having a

wide circulation in that district.

If, at an adjourned Meeting, Quorum is not present within half an hour from the

time appointed, the Members present, being not less than two in number, wil

constitute the Quorum.

An adjourned Annual General Meeting, adjourned for want of quorum or

otherwise, shal not be held on a National Holiday, only if any item relating to

fil ing up of vacancy of a director retiring by rotation is included in the agenda

of such adjourned Meeting.

An Annual General Meeting adjourned for want of quorum or otherwise, shall

not be held on a National Holiday, if vacancy of a director retiring by rotation is

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GUIDANCE NOTE ON GENERAL MEETINGS

neither fil ed up nor it is expressly resolved not to fil such vacancy at the

Meeting. [Section 152(7) of the Act]

However, by virtue of MCA Exemption Notification No. GSR 582(E) dated 13th

June, 2017, this restriction shall not apply in case of:

(a) A Government company, which is not a listed company, in which not

less than fifty-one per cent. of paid up share capital is held by the

Central Government, or by any State Government or Governments or

by the Central Government and one or more State Governments;

(b) A subsidiary of a Government company, referred to in (a) above.

The company shall ensure compliance of the provisions of holding the Annual

General Meeting every year, including adjournment thereof within a gap of not

exceeding 15 months from the date of the previous Annual General Meeting or

within such extended period permitted by the Registrar of Companies.

The provisions with respect to Annual General Meeting explained in paragraph

2.1 shal mutatis-mutandis be applicable in this regard.

Effect of MCA Notification

In case of a private company, the adjournment of Meeting for want of quorum

shall be in accordance with this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to the

adjournment of Meetings. In such a case, the Articles should be complied with

[In line with MCA Notification No. G.S.R. 464(E) dated June 5, 2015].

15.5 If, within half an hour from the time appointed for holding a Meeting

cal ed by requisitionists, a Quorum is not present, the Meeting

shal stand cancelled.

Since, a Meeting by requisitionists had been cal ed by the Members themselves,

it wil not be adjourned for want of Quorum but shal stand cancel ed.

Effect of MCA Notification

In case of a private company, the requisitioned meeting shal stand cancelled

in accordance with this para, unless otherwise provided in the Articles.

In case of a private company, the Articles may contain a provision as to

cancellation of requisitioned Meetings. In such a case, the Articles should be

complied with [In line with MCA Notification No. G.S.R. 464(E) dated June 5,

2015].

GUIDANCE NOTE ON GENERAL MEETINGS

101

15.6 At an adjourned Meeting, only the unfinished business of the original

Meeting shal be considered.

Any Resolution passed at an adjourned Meeting would be deemed to have

been passed on the date of the adjourned Meeting and not on any earlier date.

If any new business has to be transacted, a fresh Meeting should be duly

convened for the purpose of transacting such new business.

16. Passing of Resolutions by postal bal ot

16.1 Every company, except a company having less than or equal to

two hundred Members, shall transact items of business as

prescribed, only by means of postal bal ot instead of transacting

such business at a General Meeting.

A list of items of businesses requiring to be transacted only by means of a

postal ballot is given at Annexure XIV.

The Board may however opt to transact any other item of special business, not

being any business in respect of which Directors or auditors have a right to be

heard at the Meeting, by means of postal ballot.

Ordinary business shall not be transacted by means of a postal ballot.

Postal bal ot cannot be conducted in respect of ordinary business and/or matters

where the Directors, Auditors, etc. have a right of being heard at the Meeting.

16.2 Every company having its equity shares listed on a recognised stock

exchange other than companies whose equity shares are listed on

SME Exchange or on the Institutional Trading Platform and other

companies which are required to provide e-voting facility shal

provide such facility to its Members in respect of those items, which

are required to be transacted through postal bal ot.

Other companies presently prescribed are companies having not less than

one thousand Members.

Nidhis are not required to provide e-voting facility to their Members.

Every company having its equity shares listed on a recognised stock exchange

and every company having not less than one thousand members should provide

e-voting facility to its Members to exercise their voting rights. However, pursuant

to proviso to Rule 20(2) of the Companies (Management and Administration)

Rules, 2014, a Nidhi or an enterprise or institutional investor referred to in

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GUIDANCE NOTE ON GENERAL MEETINGS

Chapter XB (companies listed on SME Exchange) or Chapter XC (companies

listed on Institutional Trading Platform) of the Securities and Exchange Board of

India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as the

case may be, are exempt from providing remote e-voting facility.

Where the item of business is one for which the company concerned should

provide a postal ballot process for passing Resolutions, the question of calling

and holding a General Meeting does not arise except in case of the court-

convened meeting for mergers and amalgamations of the company.

16.3 Board Approval

The Board shal :

(a) identify the businesses to be transacted through postal bal ot;

(b) approve the Notice of postal ballot incorporating proposed

Resolution(s) and explanatory statement thereto;

(c) authorise the Company Secretary or where there is no Company

Secretary, any Director of the company to conduct postal bal ot

process and sign and send the Notice along with other documents;

(d) appoint one scrutiniser for the postal bal ot;

The scrutiniser may be a Company Secretary in Practice, a Chartered Accountant

in Practice, a Cost Accountant in Practice, an Advocate or any other person of

repute who is not in the employment of the company and, who can in the

opinion of the Board, scrutinise the postal bal ot process in a fair and transparent

manner.

The scrutiniser shall however not be an officer or employee of the company.

The scrutiniser so appointed may take assistance of a person who is not in

employment of the company and who is well-versed with the e-voting system.

Prior Consent to act as a scrutiniser shall be obtained from the scrutiniser and

placed before the Board for noting.

The scrutiniser should be wil ing to be appointed and be available for the

purpose of ascertaining the requisite majority.

(e) appoint an Agency in respect of e-voting for the postal bal ot;

An Agency should be appointed by the Board which can handle the whole

process of postal ballot through e-voting.

GUIDANCE NOTE ON GENERAL MEETINGS

103

(f) decide the cut-off date for reckoning Voting Rights and ascertaining

those Members to whom the Notice and postal bal ot forms shal

be sent.

Only Members on the cut-off date shal be entitled to vote on the proposed

Resolution by postal ballot.

In case of postal ballot, all the Members would be entitled to vote, since the

cut-off date for the purpose of reckoning voting rights and for the purpose of

sending Notice would be the same.

16.4 Notice

16.4.1 Notice of the postal bal ot shal be given in writing to every

Member of the company. Such Notice shal be sent either by

registered post or speed post, or by courier or by e-mail or

by any other electronic means at the address registered with

the company.

The Notice shall be accompanied by the postal ballot form with the necessary

instructions for fil ing, signing and returning the same.

In case the Notice and accompanying documents are sent to Members by e-

mail, these shall be sent to the Members’ e-mail addresses, registered with

the company or provided by the depository, in the manner prescribed under

the Act.

Such Notice shal also be given to the Directors and Auditors of the company, to

the Secretarial Auditor, to Debenture Trustees, if any, and, wherever applicable

or so required, to other specified recipients.

The provisions with respect to sending of Notice explained earlier in paragraph

1.2.1 & 1.2.2 above shall mutatis-mutandis be applicable in this regard.

An advertisement containing prescribed details shal be published at least

once in a vernacular newspaper in the principal vernacular language of the

district in which the registered office of the company is situated, and having a

wide circulation in that district, and at least once in English language in an

English newspaper having a wide circulation in that district, about having

dispatched the Notice and the ballot papers.

In cases where e-voting facility is provided, the Notice should be published in

an English newspaper having country-wide circulation; whereas in other cases,

such Notice should be published in the English newspaper having a wide

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GUIDANCE NOTE ON GENERAL MEETINGS

circulation in the district in which the registered office of the company is situated.

If the company accidental y omits to send the Notice to a Member or if a

Member does not receive the Notice sent to him, this wil not invalidate the

Resolution passed or the result of the postal ballot.

16.4.2 In case of companies having a website, Notice of the postal

bal ot shal simultaneously be placed on the website.

Such Notice shall remain on the website til the last date for receipt of the

postal ballot forms from the Members.

16.4.3 Notice shal specify the day, date, time and venue where the

results of the voting by postal bal ot wil be announced and

the link of the website where such results wil be displayed.

Notice shall also specify the mode of declaration of the results of the voting by

postal bal ot.

It is a general practice to give the information about the date, time and venue

of declaration of result of postal ballot.

A company may even declare the result at its registered office, corporate office

and head office and put it on the company website.

Regulation 29(1)(d) of Listing Regulations: Prior Intimation

Equity Listed Company should give prior intimation to stock exchange(s)

about the proposed Postal Bal ot for obtaining shareholder approval for

further fund raising indicating the type of issuance. Such intimation may

be given immediately after Board’s approval for conducting such item

through Postal Ballot.

Equity Listed Company should also send a copy of the Notice of Postal

Ballot to stock exchange(s) as soon as possible and not later than within

24 hours of despatch of the said Notice to the shareholders. (In line with

Schedule I I (Part A) of Listing Regulations).

16.4.4 Notice of the postal bal ot shal inform the Members about

availability of e-voting facility, if any, and provide necessary

information thereof to enable them to access such facility.

In case the facility of e-voting has been made available, the provisions relating

to conduct of e-voting shall apply, mutatis mutandis, as far as applicable.

GUIDANCE NOTE ON GENERAL MEETINGS

105

Notice shall describe clearly the e-voting procedure.

Notice should also mention the Internet link of e-voting platform.

Notice shall also clearly specify the date and time of commencement and end

of e-voting, if any and contain a statement that voting shall not be allowed

beyond the said date and time. Notice shall also contain contact details of the

official responsible to address the grievances connected with the e-voting for

postal bal ot.

The Notice should request the Members to send their assent or dissent in

writing on the postal ballot paper or vote through electronic means within a

period of thirty days from the date of dispatch of such Notice.

Notice shall clearly specify that any Member cannot vote both by post and e-

voting and if he votes both by post and e-voting, his vote by post shall be

treated as invalid.

The advertisement shall, inter alia, state the fol owing matters:

(a) a statement to the effect that the business is to be transacted by postal

bal ot which may include voting by electronic means;

(b) the date of completion of dispatch of Notices;

(c) the date of commencement of voting (postal and e-voting);

(d) the date of end of voting (postal and e-voting);

(e) the statement that any postal ballot form received from the Member

after thirty days from the date of dispatch of Notice wil not be valid;

(f) a statement to the effect that Member who has not received postal

ballot form may apply to the company and obtain a duplicate thereof;

(g) contact details of the person responsible to address the queries/

grievances connected with the voting by postal ballot including voting

by electronic means, if any; and

(h) day, date, time and venue of declaration of results and the link of the

website where such results wil be displayed.

Notice and the advertisement shal clearly mention the cut-off date as on which

the right of voting of the Members shal be reckoned and state that a person

who is not a Member as on the cut-off date should treat this Notice for

information purposes only.

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16.4.5 Each item proposed to be passed through postal bal ot shal

be in the form of a Resolution and shal be accompanied by

an explanatory statement which shal set out al such facts as

would enable a Member to understand the meaning, scope

and implications of the item of business and to take a decision

thereon.

The Resolution and the explanatory statement should be framed in simple and

intel igible language so as to enable the Members to understand the meaning,

scope and implications of the proposed items of business. The nature of interest

in the proposed Resolution and the extent of shareholding, if any, of Directors

and KMPs should be disclosed in the explanatory statement. Where reference

is made to any document, contract, agreement or the Memorandum and Articles

of Association, the relevant explanatory statement should state that such

documents are available for inspection as per the provisions of the Act.

16.5 Postal bal ot forms

16.5.1 The postal bal ot form shal be accompanied by a postage

prepaid reply envelope addressed to the scrutiniser.

A single postal ballot Form may provide for multiple items of business to be

transacted.

16.5.2 The postal bal ot form shal contain instructions as to the

manner in which the form is to be completed, assent or dissent

is to be recorded and its return to the scrutiniser.

The postal ballot form may specify instances in which such Form shall be

treated as invalid or rejected and procedure for issue of duplicate postal ballot

Forms.

16.5.3 A postal bal ot form shal be considered invalid if:

(a) A form other than one issued by the company has been

used;

(b) It has not been signed by or on behalf of the Member;

(c) Signature on the postal bal ot form doesn’t match the

specimen signatures with the company;

(d) It is not possible to determine without any doubt the

assent or dissent of the Member;

GUIDANCE NOTE ON GENERAL MEETINGS

107

(e) Neither assent nor dissent is mentioned;

(f) Any competent authority has given directions in writing

to the company to freeze the Voting Rights of the

Member;

(g) The envelope containing the postal bal ot form is received

after the last date prescribed;

The assent or dissent received after the last day specified for receipt of duly

completed postal ballot forms should be treated as if reply from the Member

has not been received.

(h) The postal bal ot form, signed in a representative capacity, is

not accompanied by a certified copy of the relevant specific

authority;

(i) It is received from a Member who is in arrears of payment of

cal s;

(j) It is defaced or mutilated in such a way that its identity as a

genuine form cannot be established;

(k) Member has made any amendment to the Resolution or

imposed any condition while exercising his vote.

Any extraneous paper enclosed in the envelope together with a valid and

correctly fil ed in postal ballot form wil not impair the validity of the postal

bal ot form. Any comment or observation made by the Member on the postal

bal ot form, apart from the vote exercised by him, should not be considered for

determining the validity of the postal ballot form.

In case any Member votes both by post and e-voting, his vote by post should

be treated as invalid.

A postal ballot form which is otherwise complete in all respects and is lodged

within the prescribed time limit but is undated shall be considered valid.

In case there are two items of business to be transacted by Resolutions to be

passed through postal ballot, if a Member has given assent or dissent for one

item and not for the other, the postal bal ot form should be treated as valid for

the item for which the decision has been conveyed and invalid for the item for

which no decision is indicated.

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GUIDANCE NOTE ON GENERAL MEETINGS

16.6 Declaration of results

16.6.1 The scrutiniser shal submit his report within seven days from

the last date of receipt of postal bal ot forms to the Chairman

or a person authorised by him, who shal countersign the

same and declare the result of the postal bal ot on the date,

time and venue specified in the Notice, with details of the

number of votes cast for and against the Resolution, invalid

votes and the final result as to whether the Resolution has

been carried or not.

The result should be announced by the Chairman or by a person authorised by

the Chairman for this purpose.

Regulation 44(3) of Listing Regulations: Voting by Shareholders

Equity Listed Company should forward the results of Postal Ballot to the

stock exchange(s) within forty eight hours of the declaration of the

same.

16.6.2 The result of the voting with details of the number of votes

cast for and against the Resolution, invalid votes and whether

the Resolution has been carried or not, along with the

scrutiniser’s report shal be displayed for at least three days

on the Notice Board of the company at its Registered Office

and its Head Office as well as Corporate Office, if any, if

such office is situated elsewhere, and also be placed on the

website of the company, in case of companies having a

website.

Results of the voting should be displayed at the Registered Office of the company.

Such results should also be displayed at the Head Office as wel as the Corporate

Office, if such offices are situated elsewhere i.e. other than where the Registered

Office is situated.

Placing of voting result on the website as wel as on the Notice Boards at the

Registered Office/ Head Office/ Corporate Office of the company is prescribed

with the intent of wider coverage and for convenience of the Members who

may visit such offices.

GUIDANCE NOTE ON GENERAL MEETINGS

109

16.6.3 The Resolution, if passed by requisite majority, shal be deemed

to have been passed on the last date specified by the company

for receipt of duly completed postal bal ot forms or e-voting.

There is no General Meeting conducted in case of postal ballot and therefore

the deemed date of passing of the Resolution shall be the last date specified

by the company for receipt of duly completed postal ballot forms or e-voting.

16.7 Custody of scrutiniser’s registers, report and other related papers

The postal ballot and all other papers relating to postal ballot including voting

by electronic means, should be under the safe custody of the scrutiniser til the

Chairman considers, approves and signs the Minutes and thereafter, the

scrutiniser should return the ballot papers and other related papers or register

to the company who should preserve such ballot papers and other related

papers or register safely [Rule 22(11) of the Companies (Management and

Administration) Rules, 2014].

The postal bal ot forms, other related papers, register and scrutiniser’s

report received from the scrutiniser shal be kept in the custody of the

Company Secretary or any other person authorised by the Board for this

purpose.

16.8 Rescinding the Resolution

A Resolution passed by postal bal ot shal not be rescinded otherwise than

by a Resolution passed subsequently through postal bal ot.

A Resolution passed by postal ballot can be rescinded only by a Resolution

passed subsequently through postal ballot.

Similarly, a Resolution rescinding the earlier Resolution should be passed in

the same manner in which the Resolution in question was passed, e.g. a

Resolution passed as a Special Resolution should be rescinded only by a

Special Resolution.

Notice of such subsequent postal ballot where the rescinding of a Resolution

passed earlier through postal ballot is proposed should specify the intention to

rescind such Resolution.

16.9 Modification to the Resolution

No amendment or modification shal be made to any Resolution circulated

to the Members for passing by means of postal bal ot.

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17. Minutes

‘Minutes’ are the official recording of the proceedings of the Meeting and the

business transacted at the Meeting.

Every company shal keep Minutes of al Meetings. Minutes kept in accordance

with the provisions of the Act evidence the proceedings recorded therein.

If the Minutes are kept in the prescribed manner, until the contrary is proved,

the Meeting shall be deemed to have been duly called and held, and al

proceedings thereat to have duly taken place.

Minutes of Meeting were rejected as evidence for not being maintained as per

the requirements of the Act [Marble City Hospitals and Research Centre (P.) Ltd.

v. Sarabjeet Singh Mokha (2010) 99 SCL 303 (MP)].

As such, Minutes of Meetings constitute a very important statutory record and

serve as evidence of various matters, until the contrary is proved.

The burden of proof is on the person who questions the correctness of the

proceedings of a Meeting as recorded in the Minutes. If the Minutes of the

Meeting are not recorded or signed within the period prescribed under the

statute, it would be presumed that the Minutes have not been properly kept

and hence such Minutes cannot be produced as evidence [B Sivaraman and

Others v. Egmore Benefit Society Ltd. (1992) 2 Comp L J 218 (Mad)].

Accordingly, when Minutes are duly drawn and signed, the contents of Minutes

are presumed to be true and the burden of proof lies on those who allege the

contents to be not true, to prove the fact.

Minutes help in understanding the deliberations and decisions taken at the

Meeting.

There is no restriction in law on the language of recording Minutes.

17.1 Maintenance of Minutes

17.1.1 Minutes shal be recorded in books maintained for that purpose.

The Minutes of proceedings of each Meeting should be entered in the books

maintained for that purpose [Rule 25(1)(b)(i) of the Companies (Management

and Administration) Rules, 2014].

Where Minutes are recorded in a proper book which is not a Minutes Book as

per law, the statutory presumption under Section 195 of the Companies Act,

1956 does not arise (corresponding to Section 118 of the Companies Act, 2013)

GUIDANCE NOTE ON GENERAL MEETINGS

111

and no such Meeting could be regarded as having been held [V. G.

Balasundaram v. New Theatres Carnatic Talkies Pvt. Ltd. (1993) 77 Comp. Cas.

324 (Mad)].

17.1.2 A distinct Minutes Book shal be maintained for Meetings of

the Members of the company, creditors and others as may

be required under the Act.

A distinct Minutes Book should be maintained for each type of Meeting namely:-

(i) General Meetings of the Members;

(i ) Meetings of the Creditors;

(i i) Meetings of the Debenture Holders; and

(iv) Meetings of class of Members.

Resolutions passed by postal bal ot shall be recorded in the Minutes book of

General Meetings.

17.1.3 A company may maintain its Minutes in physical or in

electronic form.

Minutes may be maintained in electronic form in such manner as prescribed

under the Act and as may be decided by the Board. Minutes in electronic form

shal be maintained with Timestamp.

Every Listed Company or a company having not less than one thousand

shareholders, debenture holders and other security holders, may maintain its

records in electronic form [Rule 27(1) of the Companies (Management and

Administration) Rules, 2014]. An Explanation underneath the said Rule states

that the term “records” means any register, index, agreement, memorandum,

minutes or any other document required by the Act or the rules made there

under to be kept by a company.

This paragraph of SS-2 clearly states that Minutes of Meetings may be maintained

in electronic form with Timestamp.

Timestamp

Timestamp is the most authentic way to assure existence of electronic

documents, agreements, certificates or any other vital information in electronic

form. The term ‘Timestamp’ is derived from rubber stamps used in offices to

record when the document was received. However, in modern times, usage of

the term has expanded to refer to digital date and time information attached to

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GUIDANCE NOTE ON GENERAL MEETINGS

digital data. For example, computer files contain Timestamps that indicate when

the file was last modified; digital cameras add Timestamps to the pictures they

take, recording the date and time the picture was taken.

For the purpose of SS-2, Timestamp should be created with a system integrated

time to mark the creation or modification of a file. When a file is created, the

system itself should note the time at which the file is created or modified.

When digital signature is affixed, the date and time of signing should get

recorded automatically. When an e-mail is received or sent, there should be a

recording of the time by the system. Al this should be recorded by a Secured

Computer System.

Consistency in the form of maintaining Minutes

A company shall, however, fol ow a uniform and consistent form of maintaining

the Minutes. Any deviation in such form of maintenance shal be authorised by

the Board.

Companies should maintain the Minutes of all Meetings either in physical form

or in electronic form. In other words, the companies should not maintain Minutes

of few Meetings in physical form and few in electronic form. Companies should

fol ow a uniform and consistent form of maintaining the Minutes.

Maintenance of Minutes in electronic form

Where Minutes are maintained in electronic form, fol owing requirements should

be satisfied –

(a) the information contained therein remains accessible so as to be usable

for a subsequent reference;

( b) it is retained in the format in which it was originally generated, or in a

format which can be demonstrated to represent accurately the

information originally generated;

(c) the details which would facilitate the identification of the origin,

destination, date and time of generation are available in the electronic

record.

The Managing Director, Company Secretary or any other Director or officer of

the company as the Board may decide should be responsible for the

maintenance and security of Minutes in electronic form [Rule 28(1) of Companies

(Management and Administration) Rules, 2014]. The Board may authorise any

one of the above to maintain the Minutes Book whose duty and responsibility

would be to maintain it securely.

GUIDANCE NOTE ON GENERAL MEETINGS

113

The person who is responsible for the maintenance and security of Minutes in

electronic form should -

(a) provide adequate protection against unauthorised access, alteration or

tampering of Minutes;

(b) ensure against loss of the Minutes as a result of damage to, or failure

of the media on which the Minutes are maintained;

(c) ensure that the signatory of Minutes does not repudiate the signed

Minutes as not genuine;

(a) ensure that computer systems, software and hardware are adequately

secured and validated to ensure their accuracy, reliability and consistent

intended performance;

(e) ensure that the computer systems can discern invalid and altered

Minutes;

(f) ensure that Minutes are accurate, accessible, and capable of being

reproduced for reference later;

(g) ensure that the Minutes are at al times capable of being retrieved to a

readable and printable form;

(h) ensure that Minutes are kept in a non-rewriteable and non-erasable

format like pdf. version or some other version which cannot be altered

or tampered;

(i) ensure that a backup is kept of the updated Minutes maintained in

electronic form; such backup is authenticated and dated and is securely

kept at such place as may be decided by the Board;

(j) limit the access to the Minutes to the Managing Director, Company

Secretary or any other Director or officer or persons performing work of

the company as may be authorised by the Board in this behalf;

Access may be given to the Auditor(s) and / or other persons as al owed

in terms of relevant paragraphs of SS-2.

(k) ensure that any reproduction of non-electronic original Minutes in

electronic form is complete, authentic, true and legible when retrieved;

(l) arrange and index the Minutes in a way that permits easy location,

access and retrieval of any particular record; and

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GUIDANCE NOTE ON GENERAL MEETINGS

(m) take necessary steps to ensure security, integrity and confidentiality of

Minutes.

17.1.4 The pages of the Minutes Books shal be consecutively numbered.

This shal be fol owed irrespective of a break in the Book arising out of periodical

binding in case the Minutes are maintained in physical form. This shall be

equal y applicable for maintenance of Minutes Book in electronic form with

Timestamp.

So as to facilitate easy retrieval of any decision/Resolution and additionally to

safeguard the integrity of the Minutes, the pages of the Minutes Book should

be consecutively numbered irrespective of break in the Minutes Book. Thus, in

case a Minutes Book is ful and a new Minutes Book is started, the numbering

should continue from the number appearing on the last page of the previous

Minutes Book.

This should also be fol owed irrespective of the number or year of Meeting.

For the purpose of this paragraph of SS-2, a company may choose to give

consecutive numbering from Meetings held on or after 1st July, 2015, this being

the date from which SS-2 became effective.

In the event any page or part thereof in the Minutes Book is left blank, it shal

be scored out and initial ed by the Chairman who signs the Minutes.

17.1.5 Minutes shal not be pasted or attached to the Minutes Book,

or tampered with in any manner.

The law prohibits pasting of Minutes in the Minutes Book and hence Minutes

cannot be type-written and then pasted in bound Minutes Book or in loose

leaves. Minutes should also not be printed on a piece of paper, whether on

letterhead or other paper, and pasted in Minutes Book.

It is with a view to maintain the integrity and evidentiary value of Minutes that

a lot of safeguards have been introduced in SS-2 so that Minutes are kept,

maintained and preserved with requisite care and caution.

17.1.6 Minutes of Meetings, if maintained in loose-leaf form, shal

be bound periodical y at least once in every three years.

Maintenance of Minutes in loose-leaf form is not specifically provided under

the Act. However, MCA has issued clarifications supporting the contention that

Minutes kept in a loose-leaf form can be said to be in accordance with the

provisions of the Act.

GUIDANCE NOTE ON GENERAL MEETINGS

115

If Minutes are maintained in loose-leaf form, these should be bound at least

once in every three years, in one or more books, coinciding with the calendar

year or financial year.

Security in case of Minutes maintained in loose leaves

There shall be a proper locking device to ensure security and proper control to

prevent removal or manipulation of the loose leaves.

This is to ensure security and effective control.

Further, if Minutes are kept in loose-leaf form, the company should:

1. take adequate precautions, appropriate to the means used, for guarding

against the risk of falsifying the information recorded; and

2. provide means for making the information available in an accurate

and intelligible form within a reasonable time to any person lawful y

entitled to examine the records.

17.1.7 Minutes Books shal be kept at the Registered Office of the

company.

Minutes of the General Meetings should be kept at the Registered Office of the

company [Rule 25(1)(e) of the Companies (Management and Administration)

Rules, 2014].

17.2 Contents of Minutes

17.2.1 General Contents

17.2.1.1 Minutes shal state, at the beginning the Meeting,

name of the company, day, date, venue and time

of commencement of the Meeting.

Minutes of Annual General Meeting shall also state the serial number of the

Meeting.

Minutes should state at the beginning the fol owing:

1. The name of the company

2. The type of Meeting (Annual General Meeting, Extra-Ordinary General

Meeting, etc.)

3. The day, date and venue of the Meeting

4. The time of commencement of the Meeting

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GUIDANCE NOTE ON GENERAL MEETINGS

5. In case of Annual General Meeting, the serial number of the Meeting.

Adjourned Meetings

In case a Meeting is adjourned, the Minutes shal be entered in respect of

the original Meeting as wel as the adjourned Meeting. In respect of a Meeting

convened but adjourned for want of quorum a statement to that effect shal

be recorded by the Chairman or any Director present at the Meeting in the

Minutes.

The Minutes of the adjourned Meeting should be prepared separately and in

the same manner as the Minutes of the original Meeting and the fact that the

Meeting is an adjourned one should be specified in such Minutes by the

Chairman or any Director present at the Meeting.

In case of an adjourned meeting, the time at which such Meeting was adjourned

should be recorded.

17.2.1.2 Minutes shal record the names of the Directors and the

Company Secretary present at the Meeting.

Minutes should record the names of the fol owing:

1. the Directors present

The names of the Directors shal be listed in alphabetical order or in

any other logical manner, but in either case starting with the name of

the person in the Chair.

The term “any other logical manner” should be liberal y construed as

the manner in which the company deems it appropriate to record the

names of Directors present with some logic behind it e.g. designation,

seniority etc. of the Directors.

2. the Company Secretary, if any, present.

Besides the above, Minutes should also record the fol owing:

1. The name of the Director who took the Chair.

2. Names of Directors who could not be present at the meeting and

reasons thereof, as explained by the Chairman at the meeting.

3. Vote of thanks.

GUIDANCE NOTE ON GENERAL MEETINGS

117

17.2.2 Specific Contents

17.2.2.1 Minutes shal , inter alia, contain:

(a) The Record of election, if any, of the Chairman of the Meeting.

The election, if any, of the Chairman of the Meeting as provided in paragraph 5

of SS-2, should be recorded in the Minutes.

(b) The fact that certain registers, documents, the Auditor’s Report and

Secretarial Audit Report, as prescribed under the Act were available for

inspection.

(c) The Record of presence of Quorum.

If at the commencement of the Meeting, the Quorum is present, but

subsequently if some Members leave before the close of the Meeting, due to

which the Quorum requirement is not met for businesses taken up thereafter,

the Meeting should be adjourned and a statement to that effect should be

recorded in the Minutes.

(d) The number of Members present in person including representatives.

The Minutes should record the number of Members who attended the Meeting

in person including authorised representatives.

(e) The number of proxies and the number of shares represented by them.

(f) The presence of the Chairmen of the Audit Committee, Nomination and

Remuneration Committee and Stakeholders Relationship Committee or their

authorised representatives.

(g) The presence if any, of the Secretarial Auditor, the Auditors, or their

authorised representatives, the Court/Tribunal appointed observers or

scrutinisers.

(h) Summary of the opening remarks of the Chairman.

(i) Reading of qualifications, observations or comments or other remarks

on the financial transactions, which have any adverse effect on the

functioning of the company, as mentioned in the report of the Auditors.

(j) Reading of qualifications, observations or comments or other remarks,

which have any material adverse effect on the functioning of the company,

as mentioned in the report of the Secretarial Auditor.

(k) Summary of the clarifications provided on various Agenda Items.

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GUIDANCE NOTE ON GENERAL MEETINGS

(l) In respect of each Resolution, the type of the Resolution, the names of

the persons who proposed and seconded and the majority with which such

Resolution was passed.

However, the requirement of proposer and seconder is not relevant in case of

a resolution already put to vote through remote e-voting or where a pol has

been demanded.

Where a motion is moved to modify a proposed Resolution, the result of voting

on such motion shall be mentioned. If a Resolution proposed undergoes

modification pursuant to a motion by shareholders, the Minutes shal contain

the details of voting for the modified Resolution.

(m) In the case of pol , the names of scrutinisers appointed and the number

of votes cast in favour and against the Resolution and invalid votes.

(n) If the Chairman vacates the Chair in respect of any specific item, the

fact that he did so and in his place some other Director or Member took

the Chair.

(o) The time of commencement and conclusion of the Meeting.

In Form No. MGT 15, being the form for reporting by the listed companies about

the Annual General Meeting, there is a requirement to mention the time of

conclusion of the Meeting. However, since SS-2 promotes good corporate

practices, this requirement has been extended to other companies and other

General Meetings as well. Recording the time of conclusion of the Meeting

would also help the Minutes to be complete in al aspects.

The time at which such Meeting was adjourned should be recorded.

17.2.2.2 In respect of Resolutions passed by e-voting or postal

bal ot, a brief report on the e-voting or postal bal ot

conducted including the Resolution proposed, the result

of the voting thereon and the summary of the

scrutiniser’s report shal be recorded in the Minutes Book

and signed by the Chairman or in the event of death or

inability of the Chairman, by any Director duly authorised

by the Board for the purpose, within thirty days from

the date of passing of Resolution by e-voting or postal

bal ot.

In case of every Resolution passed by postal bal ot, a brief report on the postal

bal ot conducted including the Resolution proposed, the result of the voting

GUIDANCE NOTE ON GENERAL MEETINGS

119

thereon and the summary of the scrutiniser’s report should be entered in the

Minutes Book of General Meetings along with the date of such entry within

thirty days from the date of passing of Resolution [Rule 25(1)(b)(i ) of the

Companies (Management and Administration) Rules, 2014].

A specimen report of postal ballot is placed at Annexure XV.

Where the Minutes have been kept in accordance with the Act, until the contrary

is proved, the Resolutions passed by postal bal ot shall be deemed to have

been duly passed.

17.3. Recording of Minutes

Companies fol ow diverse practices with respect to recording of Minutes. Some

companies record only the decisions while some companies record only the

Resolutions that capture the decisions taken and some companies record the

entire proceedings in the form of almost an exact transcript of what had

transpired at the Meeting. SS-2 seeks to harmonise such divergent practices by

providing principles for recording of Minutes.

The Minutes should be recorded in such a way that it enables any reader to

understand what had transpired in the Meeting.

Specimens of the Minutes of an Annual General Meeting,Extra-Ordinary General

Meeting and adjourned Annual General Meeting are placed at Annexure XVI,

XVI and XVI I respectively.

17.3.1 Minutes shal contain a fair and correct summary of the

proceedings of the Meeting.

Minutes are not an exhaustive record of everything said at a Meeting. Minutes

should not attempt to record all reasons for decisions taken, i.e. al arguments

put forth for and against a particular Resolution.

The Company Secretary shall record the proceedings of the Meetings. Where

there is no Company Secretary, any other person authorised by the Board or by

the Chairman in this behalf shal record the proceedings.

In case a Company Secretary is unable to attend a Meeting or in the absence

of the Company Secretary, any other person duly authorised by the Board or by

the Chairman may attend and record the proceedings of the Meeting.

The Chairman shal ensure that the proceedings of the Meeting are correctly

recorded.

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GUIDANCE NOTE ON GENERAL MEETINGS

Chairman’s discretion

The Chairman has absolute discretion to exclude from the Minutes, matters

which in his opinion are or could reasonably be regarded as defamatory of

any person, irrelevant or immaterial to the proceedings or which are detrimental

to the interests of the company.

The Chairman has the responsibility to ensure that the Minutes contain a fair

and accurate summary of the proceedings at the Meeting. The word “fair”

signifies the need to record matters as transpired at the Meeting without any

bias. While doing so, he has absolute discretion to exclude matters of the type

specified above.

17.3.2 Minutes shal be written in clear, concise and plain language.

Minutes need not be an exact transcript of the proceedings at the Meeting.

Minutes should be written in simple language and should contain a brief

synopsis of the discussions along with the decisions taken at the Meeting.

Minutes should record the essential elements of the Meeting i.e., narration

which is fundamental to understand the proceedings at the Meeting and the

complete text of all the Resolutions.

Minutes shal be written in third person and past tense. Resolutions shal

however be written in present tense.

17.3.3 Each item of business taken up at the Meeting shal be

numbered.

Numbering shall be in a manner which would enable ease of reference or

cross-reference.

While numbering, the company may choose to fol ow any system of numbering.

Il ustrations

(i) Serially numbering irrespective of the number of the Meeting:

Items to be discussed in the General Meeting would be numbered

1, 2, 3, 4… and so on and so forth.

(i ) Serial numbering on Meeting-to-Meeting basis:

Items to be discussed in first Meeting of XYZ Company would be

numbered as 1.1, 1.2, 1.3, 1.4 etc… Items to be discussed in the 2nd

GUIDANCE NOTE ON GENERAL MEETINGS

121

Meeting would be numbered as 2.1, 2.2, 2.3 and so on and so

forth.

(i i) Continuous numbering irrespective of year/Meeting:

Suppose there are 8 items to be discussed in the first Meeting and

10 items in the second Meeting. In such a case, the items of the 1st

Meeting would be numbered as item numbers 1-8 and the items of

the second Meeting would be numbered from 9-18 and so on.

A company should fol ow a uniform pattern of numbering for every item of

business.

17.4. Entry in the Minutes Book

17.4.1 Minutes shal be entered in the Minutes Book within thirty

days from the date of conclusion of the Meeting.

The Minutes of proceedings of each Meeting should be entered in the books

maintained for that purpose within thirty days of the conclusion of the Meeting

[Rule 25(1)(b)(i) of the Companies (Management and Administration) Rules, 2014].

In case a Meeting is adjourned, the Minutes in respect of the original Meeting

as well as the adjourned Meeting shal be entered in the Minutes Book within

thirty days from the date of the respective Meetings.

17.4.2 The date of entry of the Minutes in the Minutes Book shal be

recorded by the Company Secretary.

Where there is no Company Secretary, it shall be entered by any other person

authorised by the Board or the Chairman.

The date of entry of the Minutes should be recorded on the last page of the

respective Minutes. If the Minutes are maintained in electronic form, the date

of entry should be captured in Timestamp.

17.4.3 Minutes, once entered in the Minutes Book, shal not be altered.

The pasting of Minutes or corrections or modification in the text of Minutes duly

entered in the Minutes Book and signed by the Chairman would tantamount to

alteration of Minutes.

17.5. Signing and Dating of Minutes

17.5.1 Minutes of a General Meeting shal be signed and dated by

the Chairman of the Meeting or in the event of death or

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GUIDANCE NOTE ON GENERAL MEETINGS

inability of that Chairman, by any Director who was present

in the Meeting and duly authorised by the Board for the

purpose, within thirty days of the General Meeting.

While the Minutes of Meetings of the Board have to be entered within thirty

days, Minutes of every General Meeting should not only be entered but also

be signed within thirty days from the date of the conclusion of the Meeting.

The Minutes of an adjourned Meeting should also be signed within thirty days

of the conclusion of the adjourned Meeting.

A cursory perusal of Section 195 of the Companies Act, 1956 (corresponding to

Section 118 of the Act) regarding the presumption to be drawn where Minutes

of the company are duly drawn and signed, clearly proves that the presumption

arising in this Section is a rebuttable one by adducing contrary evidence. It is

therefore, important to ensure that the Minutes are signed and kept as stated

above in order to have the benefit of the statutory presumption that such Minutes

constitute evidence of the proceedings recorded therein.

If the Minutes are not recorded or signed within the prescribed period, it is to

be presumed that they have not been properly kept and hence wil not be

admissible in evidence [B Sivaraman and Others v. Egmore Benefit Society Ltd.

(1992) 2 Comp L J 218 (Mad)].

The authorisation to sign the Minutes in the event of death or inability of the

Chairman, may be given at a Meeting of the Board or by a Resolution passed

by circulation.

17.5.2 The Chairman shal initial each page of the Minutes, sign the

last page and append to such signature the date on which

and the place where he has signed the Minutes.

Each page of the Minutes should be initial ed or signed and the last page of the

Minutes or report in Minutes Books should be dated and signed by the Chairman

of the same Meeting within the aforesaid period of thirty days or in the event of

the death or inability of that Chairman within that period, by a Director duly

authorised by the Board for the purpose [Rule 25(1)(d)(i ) of the Companies

(Management and Administration) Rules, 2014].

The place for this purpose should be the city or town where the Minutes are

being signed. The date on which the Minutes are signed should be appended

to the signature.

Any blank space in a page between the conclusion of the Minutes and signature

of the Chairman shal be scored out.

GUIDANCE NOTE ON GENERAL MEETINGS

123

The Minutes should be recorded on consecutive pages of the Minutes Book.

No blank space should be left in between the Minutes.

If the Minutes are maintained in electronic form, the Chairman shal sign the

Minutes digitally.

Scanned signature of the Chairman cannot be affixed to the Minutes.

17.6. Inspection and Extracts of Minutes

17.6.1 Directors and Members are entitled to inspect the Minutes of

al General Meetings including Resolutions passed by postal

bal ot.

Minutes of all General Meetings shall be open for inspection by any Member

during business hours of the company, without charge, subject to such

reasonable restrictions as the company may, by its Articles or in General

Meeting, impose, so, however, that not less than two hours in each business

day are allowed for inspection.

The Act empowers only the Members to inspect and take copies of Minutes of

General Meetings [Section 119 of the Act].

The right of inspection cannot be denied whatever be the motive of the Member

[Rameshwarlal Nath v. Calcutta Wheat and Seed Association Ltd. (1938) 8 Comp.

Cas. 78 (Cal)].

Besides Members, the Directors of the company are also entitled to inspect the

Minutes of General Meetings in accordance with this paragraph of SS-2.

The Company Secretary in Practice appointed by the company, the Secretarial

Auditor, the Statutory Auditor, the Cost Auditor or the Internal Auditor of the

company can inspect the Minutes as he may consider necessary for the

performance of his duties.

This would enable the Statutory Auditor or the Internal Auditor or the Secretarial

Auditor or the Company Secretary in Practice or the Cost Auditor, as the case

may be, to discharge their professional duties fairly.

Inspection of Minutes Book may be provided in physical or in electronic form.

While providing inspection of Minutes Book, the Company Secretary or the

official of the company authorised by the Company Secretary to facilitate

inspection shal take al precautions to ensure that the Minutes Book is not

mutilated or in any way tampered with by the person inspecting.

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GUIDANCE NOTE ON GENERAL MEETINGS

17.6.2 Extract of the Minutes shal be given only after the Minutes

have been duly signed. However, any Resolution passed at a

Meeting may be issued even pending signing of the Minutes

provided the same is certified by the Chairman or any Director

or the Company Secretary.

Only after the Minutes have been signed, any extract of Minutes can be given

to third parties.

However without waiting for these formalities, certified copies of the Resolutions

can always be issued even earlier once a Resolution is passed provided the

same is certified by the Chairman or any Director or the Company Secretary.

Many a times, it might be necessary to furnish certified copies of Resolutions or

file the same with authorities for various purposes. Other than “Ordinary

Business”, it is usual to give a text of the Resolution proposed to be passed in

respect of every item forming part of the “Special Business” as set out in the

Notice of a General Meeting. Therefore, when a Resolution is passed at a

General Meeting, a certified extract of such Resolution can be given without

waiting for the Minutes to be signed.

When a Member requests in writing for a copy of any Minutes, which he is

entitled to inspect, the company shal furnish the same within seven working

days of receipt of his request, subject to payment of such fee as may be

specified in the Articles of the company. In case a Member requests for the

copy of the Minutes in electronic form, in respect of any previous General

Meetings held during a period immediately preceding three financial years,

the company shall furnish the same on payment of such fee as prescribed

under the Act.

The company should furnish copies of Minutes on payment of fees as

prescribed in the Articles but not exceeding ten rupees per page or part of

any page. However, the soft copy of Minutes of previous General Meeting

held during immediately preceding three financial years be furnished at free

of cost [Rule 26 of the Companies (Management and Administration) Rules,

2014].

Copies of the Minutes or the extracts thereof as requisitioned by the Member,

duly certified by the Company Secretary or where there is no Company Secretary,

an officer duly authorised by the Board in this behalf, may be provided in

physical or electronic form.

GUIDANCE NOTE ON GENERAL MEETINGS

125

18. Preservation of Minutes and other Records

18.1 Minutes of al Meetings shal be preserved permanently in physical

or electronic form with Timestamp.

Where, under a scheme of arrangement, a company has been merged or

amalgamated with another company, Minutes of all Meetings of the transferor

company, as handed over to the transferee company, shall be preserved

permanently by the transferee company, notwithstanding that the transferor

company might have been dissolved.

The preservation of Minutes of the merged or amalgamated company would

ensure easy reference to any important decisions taken prior to amalgamation.

18.2 Office copies of Notices, scrutiniser’s report and related papers

shal be preserved in good order in physical or in electronic form

for as long as they remain current or for eight financial years,

whichever is later and may be destroyed thereafter with the

approval of the Board.

Copies of the Notice calling the Meeting, scrutiniser’s report and other papers,

documents, agreements, approvals, etc. related to the business transacted at

the Meeting should be retained at least for as long as the related subject

remains relevant or for eight financial years, whichever is later.

Corol ary has been drawn from Rule 15 of the Companies (Management and

Administration) Rules, 2014 which prescribes a period of eight years for

preservation of the register of debenture holders or any other security holders

etc. and the annual return.

Unlike Minutes, these papers explain in detail al the proposals, voting process,

results etc. and hence would enable easy reference to the important decisions

taken earlier along with the rationale for the decisions. Therefore, considering

the importance of these papers, prior approval of the Board is necessary for

their destruction. This is also because the Directors are responsible for devising

and ensuring effective operation of proper and adequate systems, and the

need to refer to these papers may arise anytime.

Office copies of Notices, scrutiniser’s report and related papers of the transferor

company, as handed over to the transferee company, shall be preserved in

good order in physical or electronic form for as long as they remain current or

for eight financial years, whichever is later and may be destroyed thereafter

with the approval of the Board and permission of the Central Government,

where applicable.

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GUIDANCE NOTE ON GENERAL MEETINGS

The permission of the Central Government for destroying such records has

been prescribed in line with the provisions of Section 239 of the Act, which

provides that the books and papers of a company which has been amalgamated

with, or whose shares have been acquired by, another company should not be

disposed of without the prior permission of the Central Government and before

granting such permission, that Government may appoint a person to examine

the books and papers or any of them for the purpose of ascertaining whether

they contain any evidence of the commission of an offence in connection with

the promotion or formation, or the management of the affairs, of the transferor

company or its amalgamation or the acquisition of its shares.

Any record destroyed after 1st July, 2015 requires the approval of the Board,

even if such record pertains to a period prior to the applicability of SS-2.

It may be noted that the Board may authorise destruction of such records only

after the expiry of the period specified in this paragraph of SS-2.

18.3 Minutes Books shal be kept in the custody of the Company

Secretary.

Where there is no Company Secretary, Minutes shall be kept in the custody of

any Director duly authorised for the purpose by the Board.

The Company Secretary or where there is no Company Secretary, any Director

who has been duly authorised for this purpose, should ensure that the Minutes

Books are under a proper locking system and that no person has access to the

Minutes without his permission. Minutes maintained in electronic form should

also be kept under a proper security system.

Custody, for the purpose of this paragraph of SS-2, should not be construed to

mean physical custody. This paragraph signifies the responsibility to ensure

the safe custody of the Minutes by the Company Secretary or any Director

authorised by the Board for this purpose, as the case may be.

19. Report on Annual General Meeting

Every listed public company shall prepare a report on Annual General Meeting

in the prescribed form, including a confirmation that the Meeting was convened,

held and conducted as per the provisions of the Act.

In case of a listed public company, the report on Annual General Meeting

should be prepared in addition to the Minutes of the Annual General Meeting

[In line with Section 121 of the Act].

GUIDANCE NOTE ON GENERAL MEETINGS

127

Such report which shal be a fair and correct summary of the proceedings of

the Meeting shal contain:

(a) the day, date, time and venue of the Annual General Meeting;

(b) confirmation with respect to appointment of Chairman of the Meeting;

(c) number of Members attending the Meeting;

(d) confirmation of Quorum;

(e) confirmation with respect to compliance of the Act and Standards with

respect to calling, convening and conducting the Meeting;

(f) business transacted at the Meeting and result thereof with a brief

summary of the discussions;

(g) particulars with respect to any adjournment, postponement of Meeting,

change in venue; and

(h) any other points relevant for inclusion in the report.

Form No. MGT-15 prescribed by the MCA for this purpose requires all the

aforesaid details to be fil ed in the Form itself [Rule 31 of Companies

(Management and Administration) Rules, 2014].

Such report shall be filed with the Registrar of Companies within thirty days of

the conclusion of the Annual General Meeting.

20. Disclosure

The Annual Return of a company shal disclose the date of Annual General

Meeting held during the financial year.

The expression “Annual Return” for the purpose of this paragraph of SS-2 should

be understood within the meaning of Section 92 of the Act.

Every company should file with the Registrar of Companies, at the end of every

financial year, an Annual Return, which inter alia, should contain particulars of

Meetings of Members or a class thereof.

This paragraph of SS-2 requires the companies to make a disclosure in their

Annual Return, of the date of Annual General Meeting held during the year.

In addition, Form No. MGT-7 (Format of Annual Return) prescribed by MCA for

this purpose requires al companies to disclose the dates of al General Meetings

held during the financial year, total number of Members entitled to attend the

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GUIDANCE NOTE ON GENERAL MEETINGS

Meeting, and number of Members who attended the Meeting along with their

total shareholding.

Regulation 30(6) of Listing Regulations: Disclosure of events or

information

Equity Listed Company should send a copy of the Proceedings of every

General Meeting to the stock exchange(s) within 24 hours of its conclusion.

Such Proceedings should include date of the Meeting, brief details of

item deliberated and results thereof and manner of approval proposed

for certain items (e-voting etc.).

GUIDANCE NOTE ON GENERAL MEETINGS

129

Annexure I

(Refer Paragraph 1.2.10)

Specimen Attendance Slip

Name of the Company ____________________________

Registered Address ______________________________

CIN __________ Email ____________ Telephone ______ Website ________

ATTENDANCE SLIP

__________________ (Meeting Number) ____________ (Date)

Folio No. / DP ID Client ID No.

Name of First named Member/Proxy/Authorised Representative

Name of Joint Member(s), if any:

No. of Shares held

I/we certify that I/we am/are member(s)/proxy for the member(s) of the

company.

I/we hereby record my/our presence at the ____________ (Meeting number)

Annual General Meeting of the company being held on _______________(Day

& Date) at _________(time) at ________ (Venue address).

__________________

Signature of First holder/Proxy/Authorised Representative

Signature of 1st Joint holder

Signature of 2nd Joint holder

Note(s) : 1. Please sign this attendance slip and hand it over at the Attendance

Verification Counter at the MEETING VENUE.

2. Only shareholders of the company and/or their Proxy wil be al owed to

attend the Meeting.

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GUIDANCE NOTE ON GENERAL MEETINGS

Annexure I

(Refer Paragraph 1.2.10)

Specimen Notice of Annual General Meeting

Name of the Company ___________________

Registered Office ______________________________

CIN __________ Email ____________ Telephone _____ Website ________

NOTICE OF __________ (Meeting Number) ANNUAL GENERAL MEETING

NOTICE is hereby given that the _______ (Meeting Number) Annual General

Meeting of the ___________ (Name of the company) wil be held on ________

(day), the _______ (date), 20_ at ______ a.m./p.m. at ________________

(address) to transact the fol owing business:

Ordinary Business:

1. To receive, consider and adopt the standalone and consolidated

Financial Statements of the company for the financial year ended 31st

March, ____ and the Reports of the Board of Directors and Auditors

thereon.

2. To declare dividend for the financial year ended 31st March, _____.

3. To appoint a Director in place of Mr. _______ (DIN ____________),

who retires by rotation and being eligible, offers himself for

reappointment.

4. To appoint a Director in place of Mr. ______ (DIN____________), who

retires by rotation and being eligible, offers himself for reappointment.

5. To appoint a Director in place of Mr. _____ (DIN___________), who

retires by rotation and being eligible, offers himself for reappointment.

6. To appoint Statutory Auditors and to determine their remuneration. For

this purpose, to consider and if deemed fit, to passthe fol owing

Resolution as an Ordinary Resolution:

“RESOLVED THAT pursuant to the provisions of Section 139 and other

applicable provisions, if any, of the Companies Act, 2013 and the Rules

framed thereunder, as amended from time to time, M/s.________,

Chartered Accountants, (Firm Registration No._________) be and are

hereby appointed as Auditors of the company to hold office from the

GUIDANCE NOTE ON GENERAL MEETINGS

131

conclusion of this Annual General Meeting til the conclusion of the

____ Annual General Meeting of the company (subject to ratification of

their appointment at every AGM), at a remuneration of Rs. _______/-

(Rupees _______ only) for the year _________ and Rs. _____/- (Rupees

_______ only) per year for the subsequent __________ years plus

reimbursement of out of pocket expenses and service tax, as

applicable.”

“RESOLVED FURTHER THAT the Board of Directors of the company

(including a Committee thereof), be and is hereby authorised to do al

such acts, deeds, matters and things as may be considered necessary,

desirable or expedient to give effect to this Resolution.”

Or

“RESOLVED THAT pursuant to the provisions of Section 139, 142 and

other applicable provisions, if any, of the Companies Act, 2013 read

with the Companies (Audit and Auditors) Rules, 2014 (including any

statutory modification(s) or re-enactment thereof, for the time being in

force), M/s. _________________, Chartered Accountants (Registration

No. _________), who were appointed as Statutory Auditors of the

company at _____ Annual General Meeting to hold office up to the

conclusion of _____ Annual General Meeting and have confirmed their

eligibility to be appointed as Auditors in terms of the provisions of

Section 141 of the Act and the relevant Rules and have offered

themselves for re-appointment, be and are hereby re-appointed as the

Statutory Auditors of the company to hold office from the conclusion of

this Annual General Meeting til the conclusion of the next Annual

General Meeting of the company at such remuneration plus service

tax, out-of-pocket, travel ing and living expenses, etc., as may be

mutually agreed between the Board of Directors of the company and

the said Auditors.”

“RESOLVED FURTHER THAT the Board of Directors of the company

(including a Committee thereof), be and is hereby authorised to do al

such acts, deeds, matters and things as may be considered necessary,

desirable or expedient to give effect to this Resolution.”

Or

Approval of Remuneration of Statutory Auditors appointed by CAG

To consider and if deemed fit, to pass the fol owing Resolution as a

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GUIDANCE NOTE ON GENERAL MEETINGS

Special Resolution:

“RESOLVED that pursuant to Section 142 of the Companies Act 2013, and

other applicable provisions, if any, of the Companies Act, 2013, the

remuneration of the Statutory Auditors appointed by Comptrol er &

Auditor General of India (C & AG) under Section 139(5) of the said Act,

be and is hereby fixed at Rs. ________/- for the year 201_-1_.”

Special Business:

7. To appoint Mr. ____ as Director.

To consider, and if thought fit, to passthe fol owing Resolution as an

Ordinary Resolution:

“RESOLVED THAT pursuant to the provisions of Section 152 and other

applicable provisions of the Companies Act, 2013 read with the

Companies (Appointment and Qualification of Directors) Rules, 2014,

Mr. _______ (DIN _______), who was appointed as an Additional

Director of the company with effect from _________, 20__ by the Board

of Directors of the company pursuant to Section 161(1) of the Companies

Act, 2013 and the Articles of Association of the company and who

holds office upto the date of this Annual General Meeting, and being

eligible, offer himself for appointment and in respect of whom the

company has received a Notice in writing under Section 160 of the

Companies Act, 2013 from a member signifying his intention to propose

the candidature of Mr. _____ for the office of Director, be and is hereby

appointed with effect from the date of this Meeting as a Director of the

company, liable to retire by rotation.”

By Order of the Board of Directors

For _______________

___________ (Signature)

________________ (Name)

Company Secretary

Place : ________

Date : ______ 20_.

NOTES :

1. The explanatory statement setting out the material facts pursuant to

GUIDANCE NOTE ON GENERAL MEETINGS

133

Section 102 of the Companies Act, 2013, relating to special business to

be transacted at the Meeting is annexed.

2. A Member entitled to attend and vote at the Meeting is entitled to

appoint a Proxy to attend and, on a poll, to vote instead of himself

and the Proxy need not be a Member of the company.

3. Proxies, in order to be effective, must be received in the enclosed

Proxy Form at the Registered Office of the company not less than

forty-eight hours before the time fixed for the Meeting.

4. A person can act as a proxy on behalf of Members not exceeding 50

and holding in the aggregate not more than ten percent of the total

share capital of the company carrying voting rights. A Member holding

more than ten percent of total share capital of the company carrying

voting rights may appoint a single person as proxy and such person

shall not act as a proxy for any other person or shareholder.

5. A Corporate Member intending to send its authorised representatives

to attend the Meeting in terms of Section 113 of the Companies Act,

2013 is requested to send to the company a certified copy of the Board

Resolution authorizing such representative to attend and vote on its

behalf at the Meeting.

6. Members/Proxies/Authorised Representatives are requested to bring

the attendance slips duly fil ed in for attending the Meeting. Members

who hold shares in dematerialised form are requested to write their

client ID and DP ID numbers and those who hold shares in physical

form are requested to write their Folio Number in the attendance slip

for attending the Meeting.

7. During the period beginning 24 hours before the time fixed for the

commencement of Meeting and ending with the conclusion of the

Meeting, a Member would be entitled to inspect the proxies lodged at

any time during the business hours of the company. Al documents

referred to in the Notice and accompanying explanatory statement are

open for inspection at the Registered Office of the company on al

working days of the company between 11:00 a.m. and 1:00 p.m. upto

the date of the Annual General Meeting and at the venue of the Meeting

for the duration of the Meeting.

8. Route-map to the venue of the Meeting is provided at the end of the

Notice / Page no. ________ of the Annual Report.

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GUIDANCE NOTE ON GENERAL MEETINGS

9. The Register of Members and the Share Transfer Books of the company

will remain closed from _________ to __________ (both days

inclusive).

10. The dividend on shares as recommended by the Board, if approved at

the Annual General Meeting, wil be paid within thirty days from the

date of declaration to those Members or their mandatees whose names

appear:

(a) as Members in the Register of Members of the company on

______________, and

(a) as beneficial owners on that date as per the lists to be furnished

by _______ (Depository Participant) in respect of shares held in

electronic form.

11. Unclaimed / Unpaid Dividend:

Pursuant to Section 124 of the Companies Act, 2013, dividend for the

financial year ended 31st March, _______ which remains unpaid or

unclaimed for a period of seven years, become due for transfer on

______ (date) to the Investor Education and Protection Fund of the

Central Government. Members who have not claimed their dividend

for the above mentioned year are requested to make their claim to the

Share Department of the company at the Registered Office of the

company or to the Registrars & Share Transfer Agents of the company

at _______________________________ (address) as early as possible

but not later than _________ (date).

12. The company has already transferred all shares (in respect of which

dividend has not been paid or claimed for seven consecutive years or

more) along with unpaid or unclaimed dividend declared for the

financial year ended 31st March, _______ and earlier periods to the

Investor Education and Protection Fund. Members who have so far not

claimed or col ected their dividends for the said period may claim their

dividend and shares from the Investor Education and Protection Fund,

by submitting an application in the prescribed form.

13. The Securities and Exchange Board of India (SEBI) has mandated the

submission of Permanent Account Number (PAN) by every participant

in securities market. Members holding shares in electronic form are,

therefore, requested to submit the PAN to their Depository Participants

with whom they are maintaining their demat accounts. Members

GUIDANCE NOTE ON GENERAL MEETINGS

135

holding shares in physical form can submit their PAN details to the

company.

14. Electronic copy of the Annual Report is being sent to al the Members

whose email IDs are registered with the company/Depository

Participant(s) for communication purposes unless any Member has

requested for a hard copy of the same. For Members who have not

registered their email address, physical copy of the Annual Report is

being sent in the permitted mode. In case you wish to get a physical

copy of the Annual Report, you may send your request to ______

(email) mentioning your folio/DP ID and Client ID. Annual Reports is

also available in the Financials section on the website of the company

at __________.

15. Members holding shares in physical mode are requested to register

their email IDs with the Registrar & Share Transfer Agents of the

company and Members holding shares in demat mode are requested

to register their email ID’s with their respective DP in case the same is

stil not registered. Members are also requested to notify any change

in their email ID or bank mandates or address to the company and

always quote their Folio Number or DP ID and Client ID Numbers in all

correspondence with the company. In respect of holding in electronic

form, Members are requested to notify any change of email ID or bank

mandates or address to their Depository Participants.

16. Members holding shares in electronic form may please note that their

bank details as furnished to the respective Depositories wil be printed

on their dividend warrants as per the applicable regulations. The

company wil not entertain any direct request from such Members for

deletion or change of such bank details. Instructions, if any, already

given by Members in respect of shares held in physical form wil not

be automatically applicable to the dividend paid on shares in electronic

form.

17. Any query relating to financial statements must be sent to the company’s

Registered Office at least seven days before the date of the Meeting.

18. With a view to serving the Members better and for administrative

convenience, an attempt would be made to consolidate multiple folios.

Members who hold shares in identical names and in the same order

of names in more than one folio are requested to write to the company

to consolidate their holdings in one folio.

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GUIDANCE NOTE ON GENERAL MEETINGS

19. Members who stil hold share certificates in physical form are advised

to dematerialise their shareholding to avail the benefits of

dematerialisation, which include easy liquidity, since trading is permitted

in dematerialised form only, electronic transfer, savings in stamp duty

and elimination of any possibility of loss of documents and bad

deliveries.

20. Members can avail of the nomination facility by filing Form SH-13, as

prescribed under Section 72 of the Companies Act, 2013 and Rule 19(1)

of the Companies (Share Capital and Debentures) Rules, 2014, with the

company. Blank forms wil be supplied on request.

21. Voting through electronic means

In compliance with provisions of Section 108 of the Companies Act,

2013 and Rule 20 of the Companies (Management and Administration)

Rules, 2014, the company is pleased to provide members the facility of

exercising their right to vote electronically on the items mentioned in

this Notice. The company has appointed Mr. __________ as scrutinizer

for conducting the e-voting process in a fair and transparent manner.

The voting period begins on _____, ____________, 201_ at 10:01 a.m.

and wil end on ________, ___________, 201_ at 5:00 p.m.. During

this period shareholders’ of the company, holding shares either in

physical form or in dematerialised form, as on the cut-off date of

____________, 201_, may cast their vote electronically. The e-voting

module shall be disabled for voting thereafter.

The company has signed an agreement with _______ (agency) for

facilitating e-voting to enable the shareholders to cast their vote

electronical y. The instructions for shareholders voting electronically

are given at page no. ____ of the Annual Report.

22. The results shall be declared on or after the Annual General Meeting

of the company and shall be deemed to be passed on the date of

Annual General Meeting. The results alongwith the Scrutinizer’s Report

shall be placed on the website of the company __________ within 2

days of passing of the resolutions at the Annual General Meeting of

the company and shal be communicated to _____________ (Stock

Exchange).

EXPLANATORY STATEMENT

As required by Section 102 of the Companies Act, 2013, the fol owing explanatory

GUIDANCE NOTE ON GENERAL MEETINGS

137

statement sets out al material facts relating to the business mentioned under

Item No. 7 of the accompanying Notice dated _____________.

Item No. 7

Mr. ____ who was appointed as an Additional Director of the company under

Section 161(1) of the Companies Act, 2013 effective ________, _____ holds

office up to the date of this Annual General Meeting, and is eligible for

appointment as Director of the company.

The company has received Notice under Section 160 of the Companies Act,

2013 from a Member signifying her intention to propose the candidature of Mr.

____ for the office of Director.

A brief profile of Mr. _______, as required to be given pursuant to the SEBI

(Listing Obligations and Disclosure Requirements) Regulations, 2015, and other

information pertaining to his appointment has been given in the annexure to

this Notice.

Mr. _______ is not a Director of any other public limited company in India. He

is a Member of the Audit Committee and the Investment Committee of ______.

He does not hold any share in the company and is not related to any Director

or Key Managerial Personnel of the company in any way.

The Board of Directors considers it in the interest of the company to appoint Mr.

______ as a Director.

By Order of the Board of Directors

For _______________

___________ (Signature)

________________ (Name)

Company Secretary

Place :

Date : ____________20_.

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GUIDANCE NOTE ON GENERAL MEETINGS

Annexure II

(Refer Paragraph 1.2.10)

Specimen Notice of Extra-Ordinary General Meeting

Name of the Company _________________

Registered Address ________________________________

CIN _____________ Email ______________ Telephone _____ _____

Website __________

NOTICE OF

EXTRA-ORDINARY GENERAL MEETING

NOTICE is hereby given that an Extra-Ordinary General Meeting of the

_________ (name of company) wil be held on________ (day), ________

(date) at ______a.m./p.m. at _____________________ (address) to transact

the fol owing special business:

1. Shifting of Registered Office

To consider and, if thought fit, to pass the fol owing Resolution as a Special

Resolution:

“RESOLVED that pursuant to Section 13 and other applicable provisions, if

any, of the Companies Act, 2013, and subject to the approval of the Regional

Director, the Registered Office of the company be shifted from the _________

(Name of State) to the ________ (Name of State).

RESOLVED FURTHER that Clause-I of the Memorandum of Association of the

company be altered by substitution of the words ______ in place of the

words _________.

RESOLVED FURTHER that the Board of Directors of the company be and is

hereby authorised to file the necessary petition(s) before the Regional Director,

______ Region for confirmation of the alteration of Clause-II of the

Memorandum of Association of the company as aforesaid and to carry out

al other acts and deeds as are necessary in connection therewith, including

compliance of directions, if any, of the concerned authorities.”

2. Appointment of Mr. ______ as Director

To consider and, if thought fit, to passthe fol owing Resolution as an Ordinary

Resolution:

GUIDANCE NOTE ON GENERAL MEETINGS

139

“RESOLVED that pursuant to the provisions of Sections 149, 150(2), 152 and

any other applicable provisions of the Companies Act, 2013 and the rules

made there under read with Schedule IV to the Companies Act, 2013, approval

of the company be and is hereby accorded for appointment of Mr. ________

(DIN No.__________), as an Independent Director of the company to hold

the office for a period of 3 years i.e. up to ___________, ______ AND THAT

by virtue of sub-section (13) of Section 149 of the Companies Act, 2013 he

shall not be liable to retire by rotation.”

By Order of the Board of Directors

For _______________

___________ (Signature)

________________ (Name)

Company Secretary

Place : ________

Date : _________

NOTES :

1. The explanatory statement setting out the material facts pursuant to

Section 102 of the Companies Act, 2013, relating to special business to

be transacted at the Meeting is annexed.

2. A Member entitled to attend and vote at the Meeting is entitled to

appoint a Proxy to attend and, on a poll, to vote instead of himself

and the Proxy need not be a Member of the company.

3. Proxies, in order to be effective, must be received in the enclosed

Proxy Form at the Registered Office of the company not less than

forty-eight hours before the time fixed for the Meeting.

4. A person can act as a proxy on behalf of Members not exceeding 50

and holding in the aggregate not more than ten percent of the total

share capital of the company carrying voting rights. A Member holding

more than ten percent of total share capital of the company carrying

voting rights may appoint a single person as proxy and such person

shall not act as a proxy for any other person or shareholder.

5. A Corporate Member intending to send its authorised representatives

to attend the Meeting in terms of Section 113 of the Companies Act,

140

GUIDANCE NOTE ON GENERAL MEETINGS

2013 is requested to send to the company a certified copy of the Board

Resolution authorizing such representative to attend and vote on its

behalf at the Meeting.

6. Members/Proxies/Authorised Representatives are requested to bring

the attendance slips duly fil ed in for attending the Meeting. Members

who hold shares in dematerialised form are requested to write their

client ID and DP ID numbers and those who hold shares in physical

form are requested to write their Folio Number in the attendance slip

for attending the Meeting.

7. During the period beginning 24 hours before the time fixed for the

commencement of Meeting and ending with the conclusion of the

Meeting, a Member would be entitled to inspect the proxies lodged at

any time during the business hours of the company. Al documents

referred to in the Notice and accompanying explanatory statement are

open for inspection at the Registered Office of the company on al

working days of the company between 11:00 a.m. and 1:00 p.m. upto

the date of the Annual General Meeting and at the venue of the Meeting

for the duration of the Meeting.

8. Route-map to the venue of the Meeting is provided at the end of the

Notice.

9. In compliance with provisions of Section 108 of the Companies Act,

2013 and Rule 20 of the Companies (Management and Administration)

Rules, 2014, the company is pleased to provide members the facility of

exercising their right to vote electronically on the items mentioned in

this Notice. The company has appointed Mr. __________ as scrutinizer

for conducting the e-voting process in a fair and transparent manner.

The voting period begins on _____, ____________, 201_ at 10:01 a.m. and wil

end on ________, ___________, 201_ at 5:00 p.m. During this period

shareholders’ of the company, holding shares either in physical form or in

dematerialised form, as on the cut-off date of ____________, 201_, may cast

their vote electronical y. The e-voting module shal be disabled for voting

thereafter.

The company has signed an agreement with ________ (agency) for facilitating

e-voting to enable the shareholders to cast their vote electronical y. The

instructions for shareholders voting electronical y are given at the end of the

Notice.

GUIDANCE NOTE ON GENERAL MEETINGS

141

EXPLANATORY STATEMENT

As required by Section 102 of the Companies Act, 2013, the explanatory

statement sets out al material facts relating to the business mentioned under

Item Nos. 1 & 2 of the accompanying Notice dated ___________.

Item No. 1

The Registered Office of the company has been situated in ____________since

the incorporation of the company. The business of the company has increased

manifold since incorporation and it is expected that such growth trends wil be

maintained in future.

The employee strength of the company has also increased manifold and the

company needs an area of around 50,000 square feet to accommodate the

entire staff and to carry out its growing business activities efficiently. However,

expansion at the present location is not possible and prevailing rents

in____________ render it unviable to look for additional premises in the vicinity

of the Registered Office.

The Board of Directors has identified suitable premises at ____________in the

State of _______, not very far from the present Registered Office. Acquiring

such premises, situated close to ______, is advantageous for the company to

carry on its business more conveniently, economically and efficiently.

In view of these advantages, the Board of Directors has decided to shift the

Registered Office of the company from _______ (Name of State) to the

___________ (Name of State) subject to necessary approvals.

In terms of Section 13 of the Companies Act, 2013, approval of the shareholders

and the Regional Director is required for the purpose of shifting the registered

office of the company from one state to another state.

A copy of the Memorandum of Association is available for inspection at the

Registered Office of the company on al working days of the company between

11:00 a.m. and 1:00 p.m. upto the date of the Meeting and at the venue of the

Meeting for the duration of the Meeting.

The Board commends the passing of the Resolution at Item No.1 as a Special

Resolution.

None of the Directors and Key Managerial Personnel of the company or their

relatives is concerned or interested in the proposed Resolution.

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GUIDANCE NOTE ON GENERAL MEETINGS

Item No. 2

Mr. ____ is an Independent Director of the company, whose period of office is

liable to be determination by rotation of Directors under the erstwhile applicable

provisions of the Companies Act, 1956. He joined the Board in May 2010.

Section 149 of the Companies Act, 2013, provides that every listed public

company shal have at least one third of the total number of Directors as

Independent Directors. An Independent Director can be appointed for any period

up to 5 years but can be re-appointed for another term of not more than 5

years by passing a Special Resolution. The provisions relating to retirement of

Directors by rotation shal not apply to the appointment of Independent Director.

The Board has undertaken due diligence to determine the eligibility of Mr.

______ for appointment as an Independent Director on the Board, based upon

his qualification, expertise, track record integrity etc. and recommends the

appointment of Mr. ________ to the shareholders for a period of three years,

i.e. up to _______.

Mr. ________ wil not be liable to retire by rotation during this period.

Other than Mr. ________, none of the Directors or Key Managerial Personnel

of the company or their relatives is concerned or interested in the proposed

Resolution.

A brief profile of Mr. _________ and other information pertaining to his

appointment is given below.

By Order of the Board of Directors

For _______________

___________ (Signature)

________________ (Name)

Company Secretary

Place : __________

Date : ___________

GUIDANCE NOTE ON GENERAL MEETINGS

143

Annexure IV

(Refer Paragraph 1.2.10)

Specimen Notice of Annual General Meeting (for Newspaper)

Name of the Company____________

Registered Address ________________________________

CIN _____________ Email ______________ Telephone __________

Website __________

NOTICE is hereby given that the __________ Annual General Meeting of the

company is scheduled to be held on ___________(day) __________ (date) at

__ a.m. /p.m. at the registered office of the company situated at __________

(address).

Notice of the Meeting setting out the Resolutions proposed to be transacted

thereat and the Audited financial statements for the year ended March 31,

201__, Auditors’ Report and Report of the Board of Directors for the year ended

on that date, have also been dispatched to the Members. Notice and the said

documents are available at the company’s website __________ and copies of

said documents are also available for inspection at the registered office of the

company on all working days during the business hours up to the date of

Annual General Meeting. The company has completed dispatch of Annual

Report on _________ __, 201_.

Pursuant to the provisions of Section 108 of the Companies Act, 2013 read with

Rule 20 of the Companies (Management and Administration) Rules, 2014, your

company is pleased to provide remote e-voting facility to its Members to

exercise their right to vote on the Resolutions proposed to be transacted at the

___ (Number) Annual General Meeting. The company has arranged remote e-

voting facility through _______ (agency) at _____ (website). Notice of the Annual

General Meeting is also available at the _______ (agency’s) website.

A Member whose name appears in the register of members as on cutoff date

i.e. ____________, 201_ only shall be entitled to avail the facility of remote e-

voting as wel as voting through bal ot process at the Meeting. Members who

cast their vote through remote e-voting may attend the Meeting but shall not

be entitled to cast their vote again.

Any person who becomes Member of the company after dispatch of the Notice

of the Meeting and holding shares on _____ ___, 201_, if already registered

144

GUIDANCE NOTE ON GENERAL MEETINGS

with ____ (agency), can use his/her existing user ID and password otherwise

fol ow the detailed procedure mentioned in Notice of Meeting available at

company’s website ________ or may obtain the login ID and password by

sending a request at ________ (email ID of agency) or to the company’s

Registrar, M/s ___________ at ____________(email ID) latest by ___ p.m. of

________ , 201_.

Remote e-voting facility shal commence on __________, 201__ at 10:01 a.m.

and wil end on _____, 201_ at 5:00 p.m. The remote e-voting wil be disabled

by ____ (agency) after the said date and time.

The company has appointed Mr. _________, Practising Company Secretary as

the scrutiniser to scrutinise the e-voting process in fair and transparent manner.

In case of any queries/grievances relating to e-voting process, the Members

may contact at ______ (email ID of agency), Tel: _______ or M/s.

________________., __________ (RTA address) at __________ (email ID),

Tel: +91 __________ or at the ___________ (email ID) Tel: +91 ___________.

Please keep your most updated email ID registered with the company/your

Depository Participant to receive timely communications.

By Order of the Board of Directors

For _______________

___________ (Signature)

________________ (Name)

Company Secretary

Place : ______________.

Date : _____________.

GUIDANCE NOTE ON GENERAL MEETINGS

145

Annexure V

(Refer Paragraph 1.2.11)

Specimen Notice of Postponed Annual General Meeting

Name of the Company_______________

Registered Address ________________________________

CIN _____________ Email ______________ Telephone __________

Website __________

Members are hereby informed that, due to unforeseen and unavoidable

circumstances, the ______ Annual General Meeting of the company, which

was scheduled on _____________, ___________________, wil now be held

on __________________, ______, at _____a.m./p.m. at the Registered Office

of the company, to consider the business mentioned in the Notice dated

______________ which had been sent to Members in connection with the

Meeting originally scheduled to have been held on _______________.

A Member entitled to attend and vote at the Meeting is entitled to appoint a

Proxy to attend and, on a pol , to vote instead of himself and the Proxy need not

be a Member of the company. Proxies, in order to be effective, should be duly

completed, stamped (if applicable) and signed and must be received at the

Registered Office of the company not less than forty-eight hours before the

time fixed for the Meeting.

By Order of the Board of Directors

For _______________

___________ (Signature)

________________ (Name)

Company Secretary

Place : _____________

Date : _________________

Note :

Members may please immediately intimate any change in their address.

146

GUIDANCE NOTE ON GENERAL MEETINGS

Annexure VI

(Refer Paragraph 1.2.11)

Specimen Notice of Postponement of

Annual General Meeting (for Newspaper)

Name of the Company _______________

Registered Address ________________________________

CIN ________ Email ________ Telephone ________ Website ________

NOTICE

POSTPONEMENT OF ANNUAL GENERAL MEETING

Members are hereby informed that, due to the unforeseen and unavoidable

circumstances, it has not been possible for the company to convene the ___

Annual General Meeting of the company, which was scheduled to be held on

___20___.

Accordingly, the Board of Directors of the company has decided to postpone

the said Annual General Meeting, which now is convened on ___________20_.

Notice and other documents, if any, relevant to the re-convened Meeting wil

be dispatched to Members shortly.

A Member entitled to attend and vote at the Meeting is entitled to appoint a

Proxy to attend and, on a pol , to vote instead of himself and the Proxy need not

be a Member of the company. Proxies, in order to be effective, should be duly

completed, stamped (if applicable) and signed and must be received at the

Registered Office of the company not less than forty-eight hours before the

time fixed for the Meeting.

By Order of the Board of Directors

For _______________

___________ (Signature)

________________ (Name)

Company Secretary

Place : __________

Date : __________

Note :

Members may please immediately intimate any change in their address.

GUIDANCE NOTE ON GENERAL MEETINGS

147

Annexure VI

(Refer Paragraph 2.2)

Specimen Notice by Requisitionists Convening an

Extra-Ordinary General Meeting

NOTICE is hereby given that the persons named below, who are Members of

______ (Name of the company), having its Registered Office at

______________, and who have requisitioned the convening of an Extra-

Ordinary General Meeting of the company, hereby, in exercise of the powers

and rights conferred by Section 100 of the Companies Act, 2013, give Notice

that the said requisitioned Meeting shall be held on _______________day,

the________20__, at ________a.m./p.m. at_______(address) to consider the

fol owing proposal:

State the proposal

{OR

for considering and, if thought fit, passing the fol owing Ordinary/ Special

Resolution:

Reproduce the Resolution}

Names of requisitionists:

1. __________________

2. __________________

3. __________________

4. __________________

Note :

A Member entitled to attend and vote at the Meeting is entitled to appoint a

Proxy to attend and, on a pol , to vote instead of himself and the Proxy need not

be a Member of the Company. Proxies, in order to be effective, should be duly

completed, stamped (if applicable) and signed and must be received at the

Registered Office of the Company not less than forty-eight hours before the

time fixed for the Meeting.

148

GUIDANCE NOTE ON GENERAL MEETINGS

Annexure VII

(Refer Paragraph 2.2)

Specimen Notice of an Extra-Ordinary General Meeting cal ed on the

Requisition of Members

NOTICE

Name of the Company ____________

Registered Address ________________________________

CIN ________ Email ________ Telephone ________ Website ________

NOTICE is hereby given that, pursuant to a valid requisition under Section 100

of the Companies Act, 2013, lodged at the Registered Office of the company by

the Members whose names are annexed hereto, an Extra-Ordinary General

Meeting of the company wil be held on ________________, ______20_, at

_______ a.m./p.m. at the Registered Office of the company to consider the

fol owing proposal put forth by the requisitionists:

“RESOLVED that _______________________________________________

___________________________________________________________

__________________________________________________”

The Board of Directors has considered the abovementioned Resolution in its

Meeting held on _______20_ and submits the fol owing observations thereon

for the consideration of the Members:

_____________________________________________________________

___________________________

{after stating the observations, it should also be stated whether the Board

supports or does not support the proposal of the requisitionists contained in

the aforesaid Resolution.}

By Order of the Board of Directors

For _______________

___________ (Signature)

________________ (Name)

Company Secretary

Place : ______________

Date : ________ 20_.

GUIDANCE NOTE ON GENERAL MEETINGS

149

Notes :

1. A Member entitled to attend and vote at the Meeting is entitled to

appoint a Proxy to attend and, on a pol , to vote instead of himself and

the Proxy need not be a Member of the company. Proxies, in order to

be effective, should be duly completed, stamped (if applicable) and

signed and must be received at the Registered Office of the company

not less than forty-eight hours before the time fixed for the Meeting.

2. The requisition dated ____________, referred to above, signed by the

requisite number of Members in terms of Section 100 of the Companies

Act, 2013, and all documents referred to in the Notice are available for

inspection by any Member at the Registered Office of the company on

any working day of the company between the hours of 11:00 a.m. and

1:00 p.m. upto the date of this Extra-Ordinary General Meeting and at

the venue of the Meeting for the duration of the Meeting.

3. Route-map to the venue of the Meeting is enclosed.

150

GUIDANCE NOTE ON GENERAL MEETINGS

Annexure IX

(Refer Paragraph 2.2)

Specimen Board Resolution for convening Extra-Ordinary General

Meeting on Requisition

“RESOLVED THAT pursuant to the provisions of Section 100 and other

applicable provisions of the Companies Act, 2013 and rules thereunder and

as per the requisition received from the Members, the Board of Directors

hereby authorises calling of an Extra-Ordinary General Meeting (EGM) of the

Members on ________ (date) at ___ a.m./p.m. (time) at __________ (venue).

RESOLVED FURTHER THAT the draft notice of the EGM, the explanatory

statement and other ancil ary documents in connection with the EGM, as

placed before the Board, be and are hereby approved.

RESOLVED FURTHER THAT the Company Secretary of the company be and is

hereby authorised to sign and execute the notice and other relevant

documents in connection with the EGM and circulate them to the Members

of the company and do al such acts, deeds and things as may be necessary

in connection with calling and convening of EGM including appointing

scrutinisers and e-voting agencies, if required.”

GUIDANCE NOTE ON GENERAL MEETINGS

151

Annexure X

(Refer Paragraph 7.4)

Specimen of a Demand for Pol

Dated: _______

To

The Chairman of the ____ Annual General Meeting of ______ (Name of the

company) being held on _day, _______ 20_ at ____ a.m. /p.m. at

____________ (address).

We the undersigned, being the holders of an aggregate of ______ equity shares

of Rs.10/Re.1/ each of the company, as per the details set out below against

our respective names, demand that, pursuant to the provisions of Section 109

of the Companies Act, 2013, a pol be taken in respect of the Resolution proposed

at Item No. ___ of the Notice dated _____________ 20___ of the _________

Annual General Meeting of the company on which the voting is yet to be taken

on a show of hands.

{OR

on which voting on a show of hands has been taken but the result thereof is

yet to be announced

OR

which was declared carried on voting by show of hands.}

Sr. No. Name of

Folio No./ Client

No. of shares

Signature of

Member

ID No.

held

Members

152

GUIDANCE NOTE ON GENERAL MEETINGS

Annexure XI

(Refer Paragraph 9.2)

Announcements by the Chairman of the Meeting in

connection with a Poll

1. Immediately after a Poll is demanded:

“I request you to make your demand on the Pol Demand Sheet so that the

same can be verified to ascertain the validity of the demand in terms of the

Companies Act, 2013, and the Articles of Association of the Company.”

2. After verification of the demand and if the demand is found to be validly

made:

“I now order that the Pol on the Resolution in respect of Item No.

___________ of the Notice, on the subject of _____________ be taken and

I appoint Mr. ____________ and Mr. ____________ as the Scrutinisers.

The Pol wil commence half an hour after the transaction of al the items on

the Agenda for the Meeting.

The Pol wil be held in a part of this Hall and wil continue for half an hour

or til al the Members or their valid Proxies or Authorised Representatives

present and wil ing to cast their votes, have cast their votes, whichever is

earlier.

I authorise the Scrutinisers to issue the Pol papers to Members/Proxies/

Authorised Representatives and to advise them about the procedure to be

fol owed; and to declare the Pol as closed on conclusion thereof, after

ensuring that all the Members/Proxies/Authorised Representatives present

have been provided the opportunity to vote. In terms of the provisions of the

Articles of Association of the company, a Member who is in arrears of

moneys payable on the shares allotted to him is not entitled to vote. The

Scrutinisers can take the assistance as may be required of the officers or

employees of the company in the conduct of the pol . I request you all to

extend your co-operation in the conduct of the pol .

The details of the result of the pol would be displayed on the notice board

at the Registered Office of the company not later than 11:00 a.m. on _______,

________. It would also be put up on the website of the company

_______________ under the head ________________.”

GUIDANCE NOTE ON GENERAL MEETINGS

153

Annexure XII

(Refer Paragraph 9.2)

Checklist for Pol

Sr.

Relevant Section of

Provisions

No. the Companies Act,

2013

(1)

(2)

(3)

1.

Resolutions, as appearing in the Notice, to be

proposed and seconded.

2.

109

Pol may be ordered by the Chairman or

demanded by Member(s) (as in 3 below) before

or on the declaration of the result of the voting

by show of hands on a Resolution.

3.

109

Pol may be demanded by any Member(s)

present in person or by Proxy holding shares:

(i) of 1/10 of the total voting power, or

(i ) on which an aggregate sum of not less

than five lakh rupees has been paid up.

4.

109

The demand for a pol may be withdrawn at

any time by the person(s) who made the

demand.

5.

109

Pol shall be taken immediately if demanded

on a question of adjournment of the Meeting

or on the election of the Chairman (Section

104); otherwise within forty-eight hours from

the time it is demanded on any other question.

6.

Each Resolution should be put to poll

separately and polling papers shall be

distributed to al Members and to proxies

attending the Meeting. Thereafter, pol ing /

bal ot papers shall be deposited in a bal ot

box by the Members / proxies.

7.

105

A Member present in person or by Proxy shall

be entitled to vote only on a pol .

154

GUIDANCE NOTE ON GENERAL MEETINGS

If any Member present in person or by Proxy

has more than one vote, such Member has

the option to use his votes in different ways.

8.

109

The Chairman shal appoint such number of

Scrutinisers as he deems necessary to

scrutinise the votes given on a pol and to

report to him. The Chairman has the power,

at any time before the result of the pol is

declared, to remove a scrutiniser(s) and fil the

vacancy / vacancies.

9.

(i) The demand for a pol , except on the

question of the election of the Chairman or of

an adjournment, shall not prevent the

continuance of a Meeting for the transaction

of any business other than the question on

which a pol has been demanded.

(i ) In case of equality of votes, the Chairman

shal have a second or casting vote (in addition

to his vote as a Member).

10.

Votes shall be counted by the Scrutinisers.

11.

The results of pol shall be entered in a pol ing

register showing the votes for and against

each Resolution, which shall be signed by the

Scrutinisers, and shall be deemed to be the

decision of the Meeting.

12.

109

The Chairman shal regulate the manner of

Pol and declare the results, after completion

of the procedures listed in 6 to 11 above.

Notes :

(a) The Meeting is deemed to continue until the pol has been taken.

Appointing a later day for taking / completing the pol is not an

adjournment.

(b) A Member may vote at the pol even though not present when the pol

was demanded.

(c) Members in arrears of payment of al otment money or cal s cannot vote.

GUIDANCE NOTE ON GENERAL MEETINGS

155

Annexure XII

(Refer Paragraph 9.5.3)

Specimen Announcement on the Notice Board of the Company of the

Result of the Pol

Name of the Company _______________

Registered Address ________________________________

RESULT OF THE POLL HELD AT THE _____ MEETING OF THE COMPANY HELD ON

___________

Item No. ____ of the Notice dated ________ Subject: ___________

Total number of votes cast : _________________________________

Invalid votes : __________________________________________

Total number of valid votes : ________________________________

Number of votes cast FOR the Resolution : _____________________

Number of votes cast AGAINST the Resolution : ________________

Result : ________________________________________________

Place : __________

_________

Date : __________

CHAIRMAN

Time : __________

156

GUIDANCE NOTE ON GENERAL MEETINGS

Annexure XIV

(Refer Paragraph 16.1)

Items of Business which shal be Passed only by Postal Bal ot

1. Alteration of the objects clause of the memorandum and in the case of

the company in existence immediately before the commencement of

the Act, alteration of the main objects of the memorandum.

2. Alteration of articles of association in relation to insertion or removal of

provisions which are required to be included in the articles of a

company in order to constitute it a private company.

3. Change in place of registered office outside the local limits of any city,

town or vil age.

4. Change in objects for which a company has raised money from public

through prospectus and stil has any unutilised amount out of the money

so raised.

5. Issue of shares with differential rights as to voting or dividend or

otherwise.

6. Variation in the rights attached to a class of shares or debentures or

other securities.

7. Buy-back of shares by a company.

8. Appointment of a Director elected by smal shareholders.

9. Sale of the whole or substantial y the whole of an undertaking of a

company or where the company owns more than one undertaking, of

whole or substantial y the whole of any of such undertakings.

10. Giving loans or extending guarantee or providing security in excess of

the limit specified.

11. Any other Resolution prescribed under any applicable law, rules or

regulations.

GUIDANCE NOTE ON GENERAL MEETINGS

157

Annexure XV

(Refer Paragraph 17.2.2.2)

Specimen Report of Postal Bal ot

RESOLUTIONS PASSED BY POSTAL BALLOT ON _____________

Name of the Company_______

The company had, on ________________ dispatched to all the Shareholders,

Notice dated ______________ under Section 110 of the Companies Act, 2013,

for obtaining the consent of the Shareholders to the fol owing Ordinary Resolution

by means of postal ballot :

“RESOLVED that the consent of the company be and is hereby accorded

pursuant to Section 180(1)(a) and other applicable provisions of the Companies

Act, 2013, to the Board of Directors of the company (the Board) to sell, lease

or otherwise dispose of at such consideration and with effect from such

date as the Board may think fit, the whole or substantially the whole of the

undertaking of the company at ____________ engaged in the business of

manufacture of _____________.

RESOLVED FURTHER that the Board be and is hereby authorised to do or

cause to be done all such acts, deeds and other things as may be required

or considered necessary or incidental thereto for giving effect the aforesaid

Resolution”.

The dispatch of Notices and accompanying documents were completed on

__________ (date) to al Members appearing in the records of the company as

on _________ (cut-off date). Mr. ________, was appointed as Scrutiniser on

______________ (date) and ______________ (name of the Agency) was

appointed as an Agency on ______________ (date) for providing and

supervising electronic platform for e-voting.

It was mentioned in the said Notice dated ____________ that the postal ballot

forms sent therewith should be returned by the Shareholders duly completed

so as to reach the Scrutiniser on or before ___________. The Notice also

indicated the date of commencement of e-voting as _____________ (Day)

_____________ (Date) and the last date of e-voting as _________________

(Day) ______________ (Date) alongwith the process and manner of voting by

electronic means. The Scrutiniser was required to submit his report to the

Chairman after completion of the Scrutiny.

158

GUIDANCE NOTE ON GENERAL MEETINGS

Mr. ____________ (Scrutiniser) carried out the scrutiny of all the postal bal ot

forms and electronic votes received upto the close of working hours on

______________. He submitted his Report dated _____________ on

__________ (date) and the Chairman accepted the said Report.

The fol owing is the result of the postal ballot as per the Scrutiniser’s Report:

Total votes cast through e-Voting

Total votes cast through Postal Bal ot Forms received

Grand Total of votes cast

Number of invalid votes (e-voting + Postal Bal ot Forms)

Net Votes

Votes in favour of the Resolution including votes cast by

electronic means

Votes against the Resolution including votes cast by

electronic means

In view of the foregoing, the Ordinary Resolution set out in the Notice dated

__________ has been therefore duly approved/not approved by the requisite

majority of the Shareholders.

Place : ______________

Date : ______________

_____________________

Chairman

GUIDANCE NOTE ON GENERAL MEETINGS

159

Annexure XVI

(Refer Paragraph 17.3)

Specimen Minutes of Annual General Meeting

MINUTES OF THE PROCEEDINGS OF THE ______ (Number of Meeting) ANNUAL

GENERAL MEETING OF ______ (Name of the Company) HELD ON __________

(day), ___________ (date) 20_ AT ________ AM/ PM AT _________________

(address).

The fol owing were present:

1. Mr. W

(in the Chair)

2. Mr. B

(Director and Member)

3. Mr. C

(Director)

4. Mr. D

(Director and Member)

5. Mr. E.

(Director and Chairman of Audit Committee)

6. Mr. F

(Company Secretary)

7. _________

(Members present in person) [state number]

8. _________

representing _________ shares (Members present

by Proxy) [state number]

Mr. G, Proprietor/Partner/Authorised Representative of M/s_________,

Chartered Accountants, Auditors of the company, was present.

Mr. H, Proprietor/Partner/Authorised Representative of M/s.________, Practising

Company Secretary, Secretarial Auditor of the company, was also present.

CHAIRMAN

In accordance with Article ____________ of the Articles of Association, Mr. W,

Chairman of the Board of Directors, took the Chair.

{OR

Mr. B was elected Chairman of the Meeting, in terms of Article ____ of the

Articles of Association of the company}.

The Chairman welcomed the Members and introduced the Directors seated on

the dais.

160

GUIDANCE NOTE ON GENERAL MEETINGS

The Chairman stated that Mr......…. and Mr………Directors, could not attend

the Meeting due to…………… (explain the reason for absence).

Quorum was present at the commencement of the Meeting as well as at the

time of consideration of each item of business.

The fol owing documents / Registers of the company remained open and

accessible for inspection during the continuance of the AGM:

(a) Financial Statements for the financial year ended 31st March, _______,

including the Consolidated Financial Statements for the said financial

year, and the Reports of the Board of Directors and the Auditors.

(b) Register of Directors and Key Managerial Personnel and their

shareholding.

(c) Register of Contracts or Arrangements in which Directors are interested.

With the consent of the Members present, the Notice convening the Annual

General Meeting of the Company was taken as read.

The Chairman delivered his speech.

The business of the Meeting as per the Notice thereof was thereafter taken up

item wise.

1. Adoption of Consolidated and Standalone Financial Statements

The Chairman requested Mr. ______________ to read the Ordinary Resolution

for the adoption of the Financial Statements for the year ended 31st March,

20_____ and Mr. ____________ read out the Ordinary Resolution as fol ows:

“RESOLVED that the Financial Statements of the company for the year ended

31st March, 20________, including Consolidated Financial Statements for

the said financial year, along with the Reports of the Board of Directors and

Auditors thereon, as circulated to the Members and laid before the Meeting,

be and are hereby approved and adopted.”

After the above Resolution was proposed and seconded, but before it was put

to vote, the Chairman invited Members (other than those present by Proxy) to

make observations and comments, if any, on the Report and Financial Statements,

as well as on the other Resolutions set out in the Notice convening the Meeting.

Some Members made their observations and comments and raised queries

on the Annual Report and Financial Statements and other items set out in the

Notice and the Chairman answered their queries.

GUIDANCE NOTE ON GENERAL MEETINGS

161

Before putting the Resolution to vote, the Chairman reminded the Meeting

that Proxies were not eligible to vote on a show of hands. Thereafter, the

Chairman put the Resolution for the adoption of the Financial Statements,

Consolidated Financial Statements and the Reports thereon to vote as an

Ordinary Resolution.

On a show of hands, the Chairman declared the aforesaid Ordinary Resolution

carried by the requisite majority.

2. Declaration of Dividend

Mr. ______________ read out the fol owing Resolution:

“RESOLVED that the dividend @ Rs. ______ on the equity shares of Rs. 10/

Re.1/- each, ful y paid-up, be and is hereby declared for payment, to those

Members whose names appear on the company’s Register of Members on

____, __________20_”.

The Resolution was proposed by Mr. _____________ and seconded by Mr.

____________, and was put to vote as an Ordinary Resolution.

On a show of hands, the Chairman declared the aforesaid Ordinary Resolution

carried unanimously.

3. Appointment of Director

Proposed by:

Mr. ___________________

Seconded by:

Mr. ___________________

The following Resolution having been proposed and seconded by the

aforementioned two Members, was put to vote as an Ordinary Resolution:

“RESOLVED that pursuant to Section 152 of the Companies Act, 2013, Mr. A,

who retires by rotation and, being eligible for re-appointment, offers himself

for re-appointment, be and is hereby re-appointed as a Director of the

company liable to retire by rotation.”

On a show of hands, the Chairman declared the aforesaid Ordinary Resolution

carried unanimously.

4. Appointment of Director

Proposed by:

Mr. ___________________

Seconded by:

Mr. ___________________

162

GUIDANCE NOTE ON GENERAL MEETINGS

The following Resolution having been proposed and seconded by the

aforementioned two Members, was put to vote as an Ordinary Resolution:

“RESOLVED that pursuant to Section 152 of the Companies Act, 2013, Mr. B,

who retires by rotation and, being eligible for re-appointment, offers himself

for re-appointment, be and is hereby re-appointed as a Director of the

company liable to retire by rotation.”

On a show of hands, the Chairman declared the aforesaid Ordinary Resolution

carried unanimously.

5. Appointment of Director

Proposed by:

Mr. ___________________

Seconded by:

Mr. ___________________

The following Resolution having been proposed and seconded by the

aforementioned two Members, was put to the vote as an Ordinary Resolution:

“RESOLVED that, pursuant to Section 152 of the Companies Act, 2013, Mr. C,

who retires by rotation and, being eligible for re-appointment, offers himself

for re-appointment, be and is hereby re-appointed as a Director of the

company liable to retire by rotation.”

On a show of hands, the Chairman declared the aforesaid Ordinary Resolution

carried unanimously.

6. Appointment of Auditors

Proposed by:

Mr. ______________

Seconded by:

Mr. ______________

The following Resolution having been proposed and seconded by the

aforementioned two Members, was put to vote as an Ordinary Resolution:

“RESOLVED THAT pursuant to the provisions of Section 139 and other

applicable provisions, if any, of the Companies Act, 2013 and the Rules

framed thereunder, as amended from time to time, M/s.________, Chartered

Accountants, (Firm Registration No._________) be and are hereby appointed

as Auditors of the company to hold office from the conclusion of this Annual

General Meeting til the conclusion of the ____ Annual General Meeting of

the company (subject to ratification of their appointment at every AGM), at a

remuneration of Rs. _______/- (Rupees _______ only) for the year

_________ and Rs. _____/- (Rupees _______ only) per year for the

GUIDANCE NOTE ON GENERAL MEETINGS

163

subsequent __________ years plus reimbursement of out of pocket

expenses and service tax, as applicable.”

On a show of hands, the Chairman declared the aforesaid Ordinary Resolution

carried unanimously.

7. Appointment of Director

Proposed by:

Mr. ______________

Seconded by:

Mr. ______________

The following Resolution having been proposed and seconded by the

aforementioned two Members, was put to vote as an Ordinary Resolution:

“RESOLVED THAT pursuant to the provisions of Section 152 and other

applicable provisions of the Companies Act, 2013 read with the Companies

(Appointment and Qualification of Directors) Rules, 2014, Mr. _______ (DIN

_______), who was appointed as an Additional Director of the company

with effect from _________, 20____ by the Board of Directors of the company

pursuant to Section 161(1) of the Companies Act, 2013 and the Articles of

Association of the company and who holds of ice upto the date of this Annual

General Meeting, and being eligible, offer himself for appointment and in

respect of whom the company has received a Notice in writing under Section

160 of the Companies Act, 2013 from a member signifying his intention to

propose the candidature of Mr. _____ for the office of Director, be and is

hereby appointed as a Director of the company, liable to retire by rotation

with effect from the date of this Meeting.”

On a show of hands, the Chairman declared the aforesaid Ordinary Resolution

carried unanimously.

8. Delisting of Securities – Special Resolution

Proposed by:

Mr. _____________

Seconded by:

Mr. _____________

The following Resolution having been proposed and seconded by the

aforementioned two Members, was put to vote as a Special Resolution:

“RESOLVED that, subject to the provisions of the Securities and Exchange

Board of India (Delisting of Equity Shares) Regulations, 2009, Securities

Contracts (Regulation) Act, 1956, and the Securities and Exchange of Board

of India Act, 1992, and the rules framed thereunder and other applicable

164

GUIDANCE NOTE ON GENERAL MEETINGS

laws, rules and regulations and guidelines and subject to such other

approvals, permissions and sanctions as may be necessary and subject to

such conditions as may be prescribed by the Securities and Exchange Board

of India and Stock Exchanges while granting such approvals, permissions

and sanctions, which may be agreed to by the Board of Directors of the

company, which expression shall be deemed to include any Committee of

the Board for the time being, exercising the powers conferred by the Board,

the consent of the company be and is hereby accorded to the Board to

voluntarily de-list the equity shares of the company from _______________

(name of stock exchanges).

“RESOLVED FURTHER that the Board be and is hereby authorised to do al

acts, deeds and things as it may in its absolute discretion deem necessary

and appropriate to give effect to the above Resolution.”

On a show of hands, the Chairman declared the aforesaid Special Resolution

carried with the requisite majority.

CLOSE OF THE MEETING

There being no other business to transact, the Meeting closed at ____ AM/PM

(time of conclusion) with a vote of thanks to the Chair.

_________________

Date : __________

CHAIRMAN

Place : _________

Under each item before proposal and seconding of the Resolutions, we should

record as fol ows: “The objective and implications of the Resolution were

explained by the Chairman (or at the request of the Chairman by Mr……..

(designation)”

The Chairman informed that there were no qualifications, observations or

comments or other remarks, if any, mentioned in the Auditor’s Report or in the

Secretarial Auditor’s Report.

OR

The Chairman asked the auditors to read the qualifications*/, observations*/

comments*/ other remarks*, mentioned in the Auditor’s* / Secretarial Auditor’s*

Report.

GUIDANCE NOTE ON GENERAL MEETINGS

165

Attention of the Members present was drawn to the explanations / comments

given by the Board of Directors in their report at page…..paragraph…..

(*as may be relevant or applicable.)

In case the Annual General Meeting is adjourned for want of quorum, the

fol owing shal be inserted in the aforesaid Minutes:

The Chairman noted that the minimum number of Members required to

constitute quorum were not present and decided to wait for half-an-hour,

pursuant to the requirements of Section 103(2) of the Companies Act, 2013.

At ….(time) am / pm, the Chairman advised that the quorum for the Meeting

not being present, the … Annual General Meeting of the Members of the

Company is adjourned to the same day in the next week i.e. …. (day) the

…….(date) day of ……… (month), …..(year) at the same time i.e. …. (time) and

at the same place.

OR

In case the Annual General Meeting is adjourned for reason other than

quorum, the fol owing shal be inserted in the aforesaid Minutes:

The Chairman advised that the Meeting would need to be adjourned due to

…………………… The Chairman further advised that the details of the

adjourned Meeting would be announced in the newspapers.

The Meeting was thereafter concluded.

166

GUIDANCE NOTE ON GENERAL MEETINGS

Annexure XVII

(Refer Paragraph 17.3)

Specimen Minutes of Extra-Ordinary General Meeting

MINUTES OF THE PROCEEDINGS OF THE EXTRA-ORDINARY GENERAL MEETING

OF _______ (Name of the company) HELD ON ______ (day), _________ (date)

20___ AT_______ AM/PM AT _______________________ (address)

The fol owing were present:

1. Mr. A

(in the Chair)

2. Mr. B

(Director and Member)

3. Mr. C

(Director)

4. Mr. F

(Company Secretary)

5. ________

(Members present in person) {state number}

6. ________

(Members present by Proxy) {state number}

Mr. G, Proprietor/Partner/Authorised Representative of M/s_________,

Chartered Accountants, Auditors of the company, was present.

CHAIRMAN

In accordance with Article ____________ of the Articles of Association, Mr. A,

Chairman of the Board of Directors, took the Chair.

{OR:

Mr. B was elected Chairman of the Meeting, in terms of Article __ of the Articles

of Association of the company}

The Chairman welcomed the Members and introduced the Directors seated on

the Dias.

The Chairman stated that Mr. ______ and Mr. _____ Directors, could not attend

the Meeting due to ___________ (explain the reason for absence).

Quorum was present at the commencement of the Meeting as well as at the

time of consideration of each item of business.

With the consent of the Members present, the Notice convening the Extra-

Ordinary General Meeting of the company was taken as read.

GUIDANCE NOTE ON GENERAL MEETINGS

167

The business of the Meeting, as per the Notice thereof, was thereafter taken up

item-wise.

1. Shifting of the Registered Office

Proposed by:

Mr. ______

Seconded by:

Mr. ______

The following Resolution having been proposed and seconded by the

aforementioned two Members was put to vote as a Special Resolution:

“RESOLVED that pursuant to Section 13 and other applicable provisions, if

any, of the Companies Act, 2013, and subject to the approval of the Regional

Director, the Registered Office of the company be shifted from the _______

(Name of State) to the _________ (Name of State).

“RESOLVED FURTHER that Clause-I of the Memorandum of Association of the

company be altered by substitution of the word____________.

“RESOLVED FURTHER that the Board of Directors of the company be and is

hereby authorised to file the necessary petition(s) before the Regional Director,

_______ Region for confirmation of the alteration of Clause-I of the

Memorandum of Association of the company as aforesaid and to carry out

al other acts and deeds as are necessary in connection therewith, including

compliance of directions, if any, of the concerned authorities.”

The Chairman enquired if there were any clarifications required on the same.

Since none of the Members required any clarification, the Special Resolution

was put to vote and on a show of hands declared carried by the requisite

majority.

2. Appointment of Independent Director

Proposed by:

Mr. ______

Seconded by:

Mr. ______

The fol owing Resolution having been proposed and seconded respectively by

the aforementioned Members was put to vote as an Ordinary Resolution:

“RESOLVED that pursuant to the provisions of Sections 149, 150(2), 152 and

any other applicable provisions of the Companies Act, 2013 and the rules

made there under read with Schedule IV to the Companies Act, 2013, approval

of the company be and is hereby accorded for appointment of Mr. E (DIN

No.__________), as an Independent Director of the company to hold the

168

GUIDANCE NOTE ON GENERAL MEETINGS

office for a period of 3 years i.e. up to ___________, ______ AND THAT by

virtue of sub-section (13) of Section 149 of the Companies Act, 2013 he shall

not be liable to retire by rotation.”

The Chairman enquired from the Members present if there were any

clarifications required on the same. Since none of the Members required any

clarification, the Ordinary Resolution was put to vote and on a show of hands

declared carried by the requisite majority.

CLOSE OF THE MEETING

There being no other business to transact, the Meeting closed at ______ AM/

PM (time of conclusion) with a vote of thanks to the Chair.

____________________

CHAIRMAN

Date : ___________

Place : ___________

GUIDANCE NOTE ON GENERAL MEETINGS

169

Annexure XVII

(Refer Paragraph 17.3)

Specimen Minutes of Adjourned Annual General Meeting

MINUTES OF THE PROCEEDINGS OF THE ADJOURNED ______ (Number of

Meeting) ANNUAL GENERAL MEETING OF ______ (Name of the Company) HELD

ON __________ (day), ___________ (date) 20_ AT ________ AM/ PM AT

_________________ (address).

The fol owing were present:

1. Mr. W

(in the Chair)

2. Mr. B

(Director and Member)

3. Mr. C

(Director)

4. Mr. D

(Director and Member)

5. Mr. E.

(Director and Chairman of Audit Committee)

6. Mr. F

(Company Secretary)

7. _________

(Members present in person) [state number]

8. _________

representing _________ shares (Members present

by Proxy) [state number]

Mr. G, Proprietor/Partner/Authorised Representative of M/s_________,

Chartered Accountants, Auditors of the company, was present.

Mr. H, Proprietor/Partner/Authorised Representative of M/s.________, Practising

Company Secretary, Secretarial Auditor of the company, was also present.

CHAIRMAN

In accordance with Article ____________ of the Articles of Association, Mr. W,

Chairman of the Board of Directors, took the Chair.

OR

Mr. B was elected Chairman of the Meeting, in terms of Article ____ of the

Articles of Association of the company}.

The Chairman welcomed the Members and introduced the Directors seated on

the dais.

170

GUIDANCE NOTE ON GENERAL MEETINGS

The Chairman stated that Mr......…. and Mr………Directors, could not attend

the Meeting due to…………… (explain the reason for absence).

The Chairman stated that as the quorum was not present at the …..Annual

General Meeting, the Meeting was adjourned pursuant to Section 103(2)(a) of

the Companies Act, 2013.

In case the quorum is present at the adjourned meeting, the minutes to

contain the following:

The Chairman also stated that quorum was present at the commencement of this

adjourned Meeting as wel as at the time of consideration of each item of business.

In case the quorum is not present even at the adjourned meeting, the

minutes to contain the following:

[The Chairman noted that the minimum number of Members required to

constitute quorum were not present and decided to wait for half-an-hour,

pursuant to the requirements of Section 103(2) of the Companies Act, 2013.

At ….(time) am / pm, the Chairman advised that as the quorum was stil not

present, the Members present shal constitute quorum for the meeting, pursuant

to the requirements of Section 103(3) of the Companies Act, 2013.]

The fol owing documents / Registers of the company remained open and accessible

for inspection during the continuance of the Adjourned Annual General Meeting:

(a) Financial Statements for the financial year ended 31st March, _______,

including the Consolidated Financial Statements for the said financial

year, and the Reports of the Board of Directors and the Auditors.

(b) Register of Directors and Key Managerial Personnel and their

shareholding.

(c) Register of Contracts or Arrangements in which Directors are interested.

With the consent of the Members present, the Notice convening the Annual General

Meeting / Adjourned Annual General Meeting of the Company was taken as read.

The Chairman delivered his speech.

The business of the Meeting as per the Notice thereof was thereafter taken up

item wise*.

*[The text of recording of item wise decision wil be similar as indicated in

Specimen Minutes of Annual General Meeting]

GUIDANCE NOTE ON GENERAL MEETINGS

171

GLOSSARY

• “Body Corporate” or “Corporation” includes a company incorporated

outside India, but does not include –

(i) a co-operative society registered under any law relating to co-

operative societies; and

(i ) any other body corporate (not being a company as defined in this

Act), which the Central Government may, by notification, specify

in this behalf.

[Sub-section (11) of Section 2 of the Companies Act, 2013]

• “Company” means a company incorporated under this Act or under

any previous company law. [Sub-section (20) of Section 2 of the

Companies Act, 2013]

• “Company Secretary” or “Secretary” means a company secretary

as defined in clause (c) of sub-section (1) of Section 2 of the Company

Secretaries Act, 1980 who is appointed by a company to perform the

functions of a Company Secretary under this Act. [Sub-section (24) of

the Section 2 of the Companies Act, 2013]

• “Company Secretary in Practice” means a Company Secretary who

is deemed to be in practice under sub-section (2) of Section 2 of the

Company Secretaries Act, 1980. [Sub-section (25) of Section 2 of the

Companies Act, 2013]

• “Court” means –

(i) the High Court having jurisdiction in relation to the place at which

the registered office of the company concerned is situate, except

to the extent to which jurisdiction has been conferred on any

district court or district courts subordinate to that High Court under

sub-clause (i );

(i ) the district court, in cases where the Central Government has, by

notification, empowered any district court to exercise al or any of

the jurisdictions conferred upon the High Court, within the scope

of its jurisdiction in respect of a company whose registered office

is situate in the district;

(i i) the Court of Session having jurisdiction to try any offence under

this Act or under any previous company law;

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GUIDANCE NOTE ON GENERAL MEETINGS

(iv) the Special Court established under section 435;

(v) any Metropolitan Magistrate or a Judicial Magistrate of the First

Class having jurisdiction to try any offence under this Act or under

any previous company law. [Sub-section (29) of Section 2 of the

Companies Act, 2013]

• “Debenture” includes debenture stock, bonds or any other instrument

of a company evidencing a debt, whether constituting a charge on the

assets of the company or not. [Sub-section (30) of Section 2 of the

Companies Act, 2013]

• “Depository” means a depository as defined in clause (e) of sub-

section (1) of Section 2 of the Depositories Act, 1996. [Sub-section (32) of

Section 2 of the Companies Act, 2013]

• “Director” means a director appointed to the Board of a company.

[Sub-section (34) of Section 2 of the Companies Act, 2013]

• “Electronic Record” means data, record or data generated, image or

sound stored, received or sent in an electronic form or micro film or

computer generated micro fiche. [Clause (t) of sub-section (1) of Section

2 of the Information Technology Act, 2000]

• “Financial Statement” in relation to a company, includes –

(i) a balance sheet as at the end of the financial year;

(i ) a profit and loss account, or in the case of a company carrying on

any activity not for profit, an income and expenditure account for

the financial year;

(i i) cash flow statement for the financial year;

(iv) a statement of changes in equity, if applicable; and

(v) any explanatory note annexed to, or forming part of, any

document referred to in sub-clause (i) to sub-clause (iv):

Provided that the financial statement, with respect to One Person

Company, small company and dormant company, may not include the

cash flow statement. [Sub-section (40) of Section 2 of the Companies

Act, 2013]

• “Financial year” , in relation to any company or body corporate, means

the period ending on the 31st day of March every year, and where it

has been incorporated on or after the 1st day of January of a year, the

GUIDANCE NOTE ON GENERAL MEETINGS

173

period ending on the 31st day of March of the fol owing year, in respect

whereof financial statement of the company or body corporate is made

up. [Sub-section (41) of Section 2 of the Companies Act, 2013]

• “Independent Director” in relation to a company, means a director

other than a managing director or a whole-time director or a nominee

director, –

(a) who, in the opinion of the Board, is a person of integrity and

possesses relevant expertise and experience;

(b) (i) who is or was not a promoter of the company or its holding,

subsidiary or associate company;

(i ) who is not related to promoters or directors in the company, its

holding, subsidiary or associate company;

(c) who has or had no pecuniary relationship with the company, its

holding, subsidiary or associate company, or their promoters, or

directors, during the two immediately preceding financial years

or during the current financial year;

(d) none of whose relatives has or had pecuniary relationship or

transaction with the company, its holding, subsidiary or associate

company, or their promoters, or directors, amounting to two per

cent. or more of its gross turnover or total income or fifty lakh

rupees or such higher amount as may be prescribed, whichever

is lower, during the two immediately preceding financial years or

during the current financial year;

(e) who, neither himself nor any of his relatives –

(i) holds or has held the position of a key managerial personnel

or is or has been employee of the company or its holding,

subsidiary or associate company in any of the three financial

years immediately preceding the financial year in which

he is proposed to be appointed;

(i ) is or has been an employee or proprietor or a partner, in

any of the three financial years immediately preceding the

financial year in which he is proposed to be appointed, of –

(A) a firm of auditors or company secretaries in practice

or cost auditors of the company or its holding,

subsidiary or associate company; or

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GUIDANCE NOTE ON GENERAL MEETINGS

(B) any legal or a consulting firm that has or had any

transaction with the company, its holding, subsidiary

or associate company amounting to ten per cent. or

more of the gross turnover of such firm;

(i i) holds together with his relatives two per cent. or more of

the total voting power of the company; or

(iv) is a Chief Executive or director, by whatever name called,

of any nonprofit organisation that receives twenty-five per

cent. or more of its receipts from the company, any of its

promoters, directors or its holding, subsidiary or associate

company or that holds two per cent. or more of the total

voting power of the company; or

(f) who possesses such other qualifications as may be prescribed.

[Sub-section (6) of Section 149 of the Companies Act, 2013]

• “Managing Director” means a director who, by virtue of the articles of

a company or an agreement with the company or a Resolution passed

in its general Meeting, or by its Board of Directors, is entrusted with

substantial powers of management of the affairs of the company and

includes a director occupying the position of managing director, by

whatever name cal ed.

Explanation.– For the purposes of this clause, the power to do

administrative acts of a routine nature when so authorised by the Board

such as the power to affix the common seal of the company to any

document or to draw and endorse any cheque on the account of the

company in any bank or to draw and endorse any negotiable instrument

or to sign any certificate of share or to direct registration of transfer of

any share, shal not be deemed to be included within the substantial

powers of management.

[Sub-section (54) of Section 2 of the Companies Act, 2013]

• “Member” , in relation to a company, means –

(i) the subscriber to the memorandum of the company who shal be

deemed to have agreed to become member of the company,

and on its registration, shal be entered as member in its register

of members;

(i ) every other person who agrees in writing to become a member

GUIDANCE NOTE ON GENERAL MEETINGS

175

of the company and whose name is entered in the register of

members of the company;

(i i) every person holding shares of the company and whose name is

entered as a beneficial owner in the records of a depository.

[Sub-section (55) of Section 2 of the Companies Act, 2013]

• “Memorandum” means the memorandum of association of a company

as originally framed or as altered from time to time in pursuance of

any previous company law or of this Act. [Sub-section (56) of Section 2

of the Companies Act, 2013]

• “Notification” means a notification published in the Official Gazette

and the expression “notify” shal be construed accordingly. [Sub-section

(58) of Section 2 of the Companies Act, 2013]

• “One Person Company” means a company which has only one person

as a member. [Sub-section (62) of Section 2 of the Companies Act,

2013].

• “Ordinary Resolution” means a Resolution when, at a General Meeting

of which the Notice required under the Act has been duly given, the

votes cast (whether on a show of hands or on a pol or on e-voting) in

favour of the Resolution (including the casting vote, if any, of the

Chairman) exceed the votes, if any, cast against the Resolution by

Members entitled to vote thereon either in person or, where proxies

are allowed, by Proxy. [In line with Section 114 of the Act]

• “Registrar” or “Registrar of Companies” means a Registrar, an

Additional Registrar, a Joint Registrar, a Deputy Registrar or an Assistant

Registrar, having the duty of registering companies and discharging

various functions under this Act. [Sub-section (75) of Section 2 of the

Companies Act, 2013]

• “Related party” , with reference to a company, means –

(i) a director or his relative;

(i ) a key managerial personnel or his relative;

(i i) a firm, in which a director, manager or his relative is a partner;

(iv) a private company in which a director or manager [or his relative]

is a member or director;

(v) a public company in which a director or manager is a director

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GUIDANCE NOTE ON GENERAL MEETINGS

[and] holds along with his relatives, more than two per cent. of

its paid-up share capital;

(vi) any body corporate whose board of directors, managing director

or manager is accustomed to act in accordance with the advice,

directions or instructions of a director or manager;

(vi ) any person on whose advice, directions or instructions a director

or manager is accustomed to act:

Provided that nothing in sub-clauses (vi) and (vi ) shal apply to

the advice, directions or instructions given in a professional

capacity;

(vi i) Any company which is –

(A) a holding, subsidiary or an associate company of such

company; or

(B) a subsidiary of a holding company to which it is also a

subsidiary;

(ix) such other person as may be prescribed. [Sub-section (76) of

Section 2 of the Companies Act, 2013 and Rule 3 of Companies

(Specification of definitions details) Rules, 2014]

• ‘ Relative’ , with reference to any person, means anyone who is related

to another, if –

(i) they are members of a Hindu Undivided Family;

(i ) they are husband and wife; or

(i i) one person is related to the other in such manner as may be

prescribed. [Sub-section (77) of Section 2 of the Companies Act,

2013]

A person shall be deemed to be the relative of another, if he or she is

related to another in the fol owing manner, namely:-

(1) Father:

Provided that the term “Father” includes step-father.

(2) Mother:

Provided that the term “Mother” includes the step-mother.

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177

(3) Son:

Provided that the term “Son” includes the step-son.

(4) Son’s wife.

(5) Daughter.

(6) Daughter’s husband.

(7) Brother:

Provided that the term “Brother” includes the step-brother;

(8) Sister:

Provided that the term “Sister” includes the step-sister.

[Rule 4 of Companies (Specification of definitions details) Rules, 2014]

• “Remuneration” means any money or its equivalent given or passed

to any person for services rendered by him and includes perquisites as

defined under the Income-tax Act, 1961. [Sub-section (78) of Section 2

of the Companies Act, 2013]

• “Schedule” means a Schedule annexed to this Act. [Sub-section (79) of

Section 2 of the Companies Act, 2013]

• “Section” means section of the Companies Act, 2013.

• “Securities” include –

(i) shares, scrips, stocks, bonds, debentures, debenture stock or other

marketable securities of a like nature in or of any incorporated

company or other body corporate;(ia) derivative;(ib) units or any

other instrument issued by any col ective investment scheme to

the investors in such schemes;

(ic) security receipt as defined in clause (zg) of section 2 of the

Securitisation and Reconstruction of Financial Assets and

Enforcement of Security Interest Act, 2002;

(id) units or any other such instrument issued to the investors under

any mutual fund scheme;

(i ) Government securities;

(i a) such other instruments as may be declared by the Central

Government to be securities; and

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GUIDANCE NOTE ON GENERAL MEETINGS

(i i) rights or interest in securities.

[Clause (h) of Section 2 of the Securities Contracts (Regulation) Act,

1956]

• “Share” means a share in the share capital of a company and includes

stock [Sub-section (84) of Section 2 of the Companies Act, 2013]

• “Special Resolution” means a Resolution in respect of which (a) the

intention to propose the Resolution as a Special Resolution has been

duly specified in the Notice cal ing the Meeting or other intimation of

the Resolution has been given to the Members; (b) the Notice of the

Meeting required under the Act has been duly given; and (c) the votes

cast in favour of the Resolution (whether on a show of hands or on a

pol or on e-voting) are not less than three times the number of the

votes, if any, cast against the Resolution by Members entitled to vote

thereon either in person or, where proxies are al owed, by Proxy. [In

line with Section 114 of the Act]

• “Total Share Capital” , for the purposes of clause (6) and clause (87) of

section 2, means the aggregate of the -

(a) paid-up equity share capital; and

(b) convertible preference share capital.

[Rule 2(1)(r) of Companies (Specification of Definitions Details) Rules,

2014]

• “Total Voting Power” , in relation to any matter, means the total number

of votes which may be cast in regard to that matter on a pol at a

Meeting of a company if al the members thereof or their proxies having

a right to vote on that matter are present at the Meeting and cast their

votes; [Sub-section (89) of Section 2 of the Companies Act, 2013]

• “Tribunal” means the National Company Law Tribunal constituted under

Section 408. [Sub-section (90) of Section 2 of the Companies Act, 2013]

• “Voting Right” means the right of a member of a company to vote in

any Meeting of the company or by means of postal bal ot. [Sub-section

(93) of Section 2 of the Companies Act, 2013]

• “Whole-time Director” includes a director in the whole-time

employment of the company. [Sub-section (94) of Section 2 of the

Companies Act, 2013]

Document Outline

Starting Pages.pmd.pdf

Guidance Note on General Meeting.pmd.pdf