CALLING
OF EXTRA-ORDINARY GENERAL MEETING BY REQUISITION
OF MEMBERS
By
CS D Hem Senthil Raj
CS K Vinoth
The Companies Act, 2013
provides the right/power to the members of the Company to request the Board of
Directors to call for an Extra – Ordinary General Meeting under the provision
of Section 100 (2) (a) for the Companies having Share capital and Section 100
(2) (b) for the Companies not having share capital.
Provision under this
Section is applicable for both Public and Private Limited Companies. In case of a Listed Entity any requisition
for calling for EGM received from the members shall be intimated to the Stock
Exchange.
Who
can make requisition to the Board for calling of EGM?
Members of the Company
who holds not less than one tenth of paid-up share capital of the Company which
carries the voting right in case of a Company having Share capital (or) not
less than one tenth of total voting powers in case of a Company not having
share capital as on date of making requisition.
Whether
the agenda/item of businesses needs to be considered in the EGM to be included
in the requisition made by the members?
Yes, the agenda/item of
business to be considered and transacted at the EGM shall be included in the
requisition made by the members.
Any
specific format is specified under Companies Act, 2013?
There is no specific
format prescribed under the Companies Act, 2013. However it shall include the place,
date, day, hour, agenda, name, address, folio number, DP ID, Client ID, number
of shares held, signature of the Members and such other items as specifically
mentioned in the Articles of Association of the Company.
As
per Section 100 (4) of the Companies Act, 2013 if the board does not proceed to
call for an Extra-Ordinary General Meeting for the agenda/item of business as
specified in the requisition made by the members within 21 days from the date
of receipt of valid requisition, in such a case the members have the right to
call for an Extra-Ordinary General Meeting within three months from the date of
the requisition made. However, if the board proceed to call for an EGM within
21 days from the date of receipt of requisition from members, it shall call for
an EGM within 45 days from the date of receipt of requisition.
If
the Board of the Directors fails to convene the Meeting within the stipulated
time period and the same is convened by the requisitionists (members), any
reasonable expenses incurred by the requisitionists (members) in calling and
convening an Extra-Ordinary General Meeting shall be reimbursed by the Company
and the same shall be deducted from the fee or remuneration payable to the
Board of Directors,
Note:
Requistionists
should convene meeting at registered office or in the same city or town where
registered office is situated and such meeting should be convened on working
day.
In case of Limited
Company having more than two hundred members/Listed entity, can a Company go
for Postal Ballot Process rather than EGM?
As
per the provisions of Companies Act, 2013 the Company is required to call for
an EGM on all requisition received under Section 100 and it cannot go for
Postal Ballot process.
Can it be practicable
for the Members of the Limited / Listed Company to conduct an EGM under Section
100 (4) of Companies Act, 2013, if the Company fails to initiate the EGM
process within 21 days?
Yes,
the Members of a limited/listed entity shall convene the EGM in case of default
made by the company to call for the EGM as per the provision of Companies Act,
2013 and Rules.
However,
under the provisions of Companies Act, 2013, there is no such separate
procedure are prescribed for conducting the EGM by the requisitionists
themselves in case of a listed entities.
In
view of the above, the same procedure as applicable to other class of companies
shall be followed by the requisitionists (members).
Can a Board of
Directors include the other item of businesses/agenda in addition to the
agenda/item of business referred by the members for calling the EGM?
Yes,
the Board may include the other item of business in the Notice of EGM in
consultation with the members and justifying the necessity for such inclusion
which is in the best interest of the company.
Whether e-voting is
mandatory in case of EGM conducted by requisitionists?
Yes,
as per the provisions of the Clause 35B of the Listing Agreement, any General Meeting
conducted by the company shall provide e-voting facility to the members and
such details of voting results shall also be filed with the stock exchanges as
per the prescribed format purusuant to clause 35A of the Listing Agreement.
However, in case of EGM convened by the Members of
Listed Company, it may not be practicable from the member’s side to request the
NSDL/CDSL to provide for e-voting facility, since it requires the
authentication and approval from the Company side to provide e-voting facility
to the Members.
What happens in case of
special resolution transacted in the EGM has not been approved by the members
with majority?
Such
resolution shall be treated as an invalid resolution, and it shall stand
disapproved by the members.
*****
BY
CS
K VINOTH
CS
D HEM SENTHIL RAJ
No comments:
Post a Comment