REQUISITES OF

VALID MEETING -
CONTINUED
Session Learning Objectives

■ To understand the provisions relating to

■ Proxies in meetings
■ Voting in meetings
■ Demand for Poll
■ Postal Ballot
■ Circulation of resolution
■ Minutes of meeting
Proxies (Sec 105)

■ A person who is appointed by a member to attend and vote at a meeting in the

absence of the member at the meeting is termed as proxy.
■ Section 105 of the Companies Act, 2013 provides that a member, who is entitled to
attend to vote, can appoint another person as a proxy to attend and vote at the
meeting on his behalf
■ Thus proxy is an agent of the member appointing him
■ The term ‘proxy’ is also used to refer to the instrument by which a person is
appointed as proxy
 Appointment of Proxy
■ Who can appoint a proxy:
■ Any member of a company who is entitled to attend and vote at a meeting of the company shall
be entitled to appoint another person as a proxy to attend and vote at the meeting on his behalf.
■ SS - Where allowed, one or more proxies, to attend and vote instead of himself and a Proxy need
not be a Member.
■ Restriction on proxy:
■ A member of a company registered under section 8 (Not for Profit company) shall not be entitled
to appoint any other person as his proxy unless such other person is also a member of such
company.
■ A person appointed as proxy shall not act as proxy on behalf of more than fifty members and
members holding in the aggregate more than ten percent of the total share capital of the
company carrying voting rights.
■ A member holding more than 10% of the total share capital of the company carrying voting rights
may appoint a single person as proxy, provided that such person shall not act as proxy for any
other person or shareholder.
Appointment of Proxy
■ Disabilities of proxy:
– A proxy shall not have the right to speak at the meeting.
– A proxy cannot vote on a show of hands.
– A proxy is not counted for the purpose of quorum.
■ Rights of proxy:
– A proxy has the right to attend the meeting.
– A proxy has the right to vote only on a poll.
– A proxy, if eligible under section 109, has the right to demand a poll.
■ Time limit for deposit of proxy forms:
– The instrument appointing the proxy must be deposited with the company, 48 hours
before the meeting.
– Any provision contained in the articles, requiring a longer period than 48 hours shall
have effect as if a period of 48 hours had been specified
Secretarial Standards on Proxy
■ Deposit of proxies:
– Proxies shall 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 shall be accepted even on a holiday if the last date by which it could
be accepted is a holiday.
■ Records of proxies:
– All Proxies received by the company shall be recorded chronologically in a register kept for
that purpose.
■ The prescribed form for appointing a proxy is Form No. MGT. 11. It needs to be in writing and
signed by the appointer or his attorney duly authorised in writing.
■ If the appointer is a body corporate, the instrument should be under its seal or be signed by an
officer or an attorney duly authorised by the body corporate.
■ An instrument appointing a Proxy shall be either in the Form specified in the Articles or in the
Form set out in the Act.
■ The instrument of Proxy shall be signed by the appointer or his attorney duly authorized in writing,
or if the appointer is a body corporate, be under its seal or be signed by an officer or an attorney
duly authorized by it.
 Secretarial Standards on Proxy
■ An instrument of Proxy duly filled, stamped and signed, is valid only for the Meeting to which it relates
including any adjournment thereof.
■ 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 cancelled are invalid.
■ The Proxy-holder shall prove his identity at the time of attending the Meeting.
■ An authorized 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.
■ A Proxy form which does not state the name of the Proxy shall not be considered valid.
■ Undated proxy form shall not be considered valid.
■ If a company receives multiple proxies for the same holdings of a Member, the Proxy which is dated last
shall be considered valid; if they are not dated or bear the same date without specific mention of time,
all such multiple Proxies shall be treated as invalid.
Secretarial Standards on Proxy
■ Inspection of proxy:
■ Every member entitled to vote at a meeting of the company, or on any resolution to be moved
thereat, is entitled to inspect the proxies lodged with the company, if at least 3 days notice in
writing is given to the company.
■ Such notice shall be received at least three days before the commencement of the Meeting.
■ Such inspection can be taken during the period beginning 24 hours before the time fixed for
the commencement of the meeting, during the business hours of the company, and ending
with the conclusion of the meeting.
■ Such inspection should be allowed between 9:00 am and 6:00 pm during such period.
■ A fresh requisition confirming to the above requirements, shall be given for inspection of
Proxies in case the Original Meeting is adjourned
Secretarial Standards on Proxy
■ Revocation of proxy:
■ If after appointment of proxy, the member himself attends the meeting, it amounts to
automatic revocation of proxy. But once the proxy has voted, it cannot be revoked.
■ 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.
■ A proxy later in date revokes any Proxy/Proxies dated prior to such Proxy.
■ 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
■ 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.
■ A Proxy need not be informed of the revocation of the Proxy issued by the Member
Example
■ Question: Annual General Meeting of a Public Company was scheduled to be held on 15.12.2015.
Mr. A, a shareholder, issued two Proxies in respect of the shares held by him in favor of Mr. 'X' and
Mr. 'Y'. The proxy in favor of 'Y' was lodged on 12.12.2015 and the one in favor of Mr. X was
lodgedon15.12.2015. The company rejected the proxy in favor of Mr. Y as the proxy in favor of Mr.
Y was of dated 12.12.2015 and thus in favor of Mr. X was of dated15.12.2015. Is the rejection by
the company in order?
■ Hint: As per Section 105 of the Companies Act, 2013 a proxy should be deposited 48 hours
before the time of the meeting. In the given case, the proxies should have, therefore, been
deposited on or before 13.12.2015 (the date of the meeting being 15.12.2015). X deposited the
proxy on 15.12.2015. Therefore, proxy in favour of Mr. X has become invalid. Thus, rejecting the
proxy in favour of Mr. Y is unsustainable. Proxy in favor of Y is valid since it is deposited in time.
■ Question: The Chairman of the meeting of a public company received a Proxy 54 hours before the
time fixed for the start of the meeting. He refused to accept the Proxy on the ground that the
Articles of thecompany provided that a Proxy must be filed 60 hours before the start of the
meeting. Decide, under theprovisions of the Companies Act, 2013 whether the Proxy holder can
compel the Chairman to admit the Proxy?
■ As per Section 105 of the Companies Act, 2013 proxy shall be deposited with the company within
48 hours before the meeting.
■ Any provisions contained in the Articles of a company that requires a longer period than48 hours
before a meeting of the company for depositing a proxy shall be void. Thus contention of Mr X is
valid
Voting
■ Restriction on Voting Rights (Section 106)
■ Members can be restricted from voting on the basis that there are unpaid calls or other sums
outstanding on the shares held or they are under lien by company
■ Voting by Show of Hands (Section 107)
■ At any general meeting, a resolution put to the vote of the meeting shall in the first instance
be decided on a show of hands, unless-
– (a) A poll is demanded under section 109 of the Act.
– (b) Voting is carried out electronically under section 108 of the Act.
■ A declaration by the Chairman of the meeting of the passing of a resolution (that the
resolution has been passed or failed, as the case may be) on show of hands and an entry to
that effect in the minutes book shall be conclusive evidence of the fact of passing of such
resolution.
■ No proof of numbers of votes casts in favor of and against the resolution is required.
 Voting
■ Voting through Electronic Means (Section 108)
– It is not possible for every member, specially members holding minor shares to travel up to
the registered office of the company and participate in the general meetings of the
company
– To eliminate this type of difficulty and to enhance the participation of minority members,
concept of e-voting has been introduced by the Companies Act 2013.
– E-voting do not eliminate members right to physically attend and vote at the general
meeting.
– However member can cast his vote through one mode only.
– A member after casting his vote through e-voting can go and attend the general meeting
but cannot cast vote in that general meeting.
■ The prescribed class of companies, for this purpose, are-
– (i) All companies whose equity shares are listed on a recognized stock exchange; and
– (ii) All companies having 1000 or more members.
 Voting
■ Following companies are out of ambit of e-voting:-
– 1. Companies having whose debenture/preference shares are only listed.
– 2. Companies listed on SME trading platform.
– 3. Companies listed on institutional trading platform.
■ Legal Requirement:
■ (a) A company to which section 108 is applicable, shall provide to its members facility to
exercise their right to vote on resolution proposed at general meetings by electronic means.
■ (b) a resolution proposed to be considered through voting by electronic means shall not be
withdrawn.
 Voting
■ Rule 20 of Companies (Management and Administration) Amendment Rules, 2015 defines some of the
terms relating to voting through electronic means as follows:
■ (i) “cut-off date” means a date not earlier than seven days before the date of general meeting for
determining the eligibility to vote by electronic means or in the general meeting;
■ (ii) “cyber security” means protecting information, equipment, devices, computer, computer resource,
communication device and information stored therein from unauthorised access, use, disclosures,
disruption, modification or destruction;
■ (iii) “electronic voting system” means a secured system based process of display of electronic ballots,
recording of votes of the members and the number of votes polled in favour or against, in such a
manner that the entire voting exercised by way of electronic means gets registered and counted in an
electronic registry in a centralised server with adequate cyber security;
■ (iv) “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;
■ (vi) “secured 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;
■ (vii) “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
■ Board’s responsibilities
– To appoint one or more scrutinisers for e-voting or the ballot process,
– To appoint an Agency – NSDL, CDSL or other such agency
– To decide the cut-off date for the purpose of reckoning the names of Members who are
entitled to Voting Rights
– To authorise the Chairman or in his absence, any other Director to receive the
scrutiniser’s register, report on e-voting and other related papers with requisite details.
■ The notice of the meeting shall clearly state that:-
– (i) the company is providing facility for voting by electronic means and the business may
be transacted through such voting.
– (ii) the facility for voting, either through voting by electronic means or ballot/polling
paper shall also be made available at the meeting and members attending the meeting
who have not already cast their vote by remote e-voting shall be able to exercise their
right at the meeting.
– (iii) that the members who have cast their vote by remote e-voting prior to the meeting
may also attend the meeting but shall not be entitled to cast their vote again.
Voting
■ Additional Disclosures in notice: The notice shall –
– (i) indicate the process and manner for voting by electronic means;
– (ii) indicate the time schedule including the time period during which the votes may be
cast by remote e-voting;
– (iii) provide the details about the login lD;
– (iv) specify the process and manner for generating or receiving the password and for
casting of vote in a secure manner.
■ Public notice by way of advertisement:
– (i) The company shall cause a public notice by way of an advertisement to be published,
immediately on completion of dispatch of notice of general meeting.
– (ii) The public notice shall be published at least twenty-one days before the date of
general meeting, at least once in a vernacular newspaper and at least once in English
language in an English newspaper
 Voting
■ Remote e-voting:
■ (i) The facility for remote e-voting shall remain open for not less than three days and shall close at 5.00 p.m. on the
date preceding the date of the general meeting.
■ (ii) During the period when facility for remote e-voting is provided, the members of the company, holding shares
either in physical form or in dematerialised form, as on the cut-off date, may opt for remote e-voting.
■ (iii) Once a member has cast his vote on a resolution, he shall not be allowed to change it subsequently or cast the
vote again.
■ (a) A member may participate in the general meeting even after exercising his right to vote through remote e-voting
but shall not be allowed to vote again.
■ (b) At the end of the remote e-voting period, the facility shall forthwith be blocked
■ Voting at General Meeting:
■ (i) During general meeting, a company may opt to provide the same electronic voting system as used during remote
e-voting. In such a case, the members attending the general meeting and who have not exercised their right to vote
through remote e-voting, shall be entitled to vote using the electronic voting system.
■ (ii) At the general meeting, after conclusion of the discussion, the chairman shall, with the assistance of scrutinisers,
allow voting on the resolutions, by use of polling paper or by using an electronic voting system for all those members
who are present at the general meeting but have not cast their votes by availing the remote e-voting facility.
Voting
■ Declaration of result of voting:
■ The scrutinizer shall, immediately after the conclusion of voting at the general 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.
■ The scrutinizer shall make, not later than three days of conclusion of the meeting, a consolidated
scrutinizer’s report of the total votes cast in favor or against, if any, to the Chairman or a person
authorized by him in writing who shall countersign the same.
■ The Chairman or a person authorized by him in writing shall declare the result of the voting
forthwith.
■ 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 shall be displayed on the Notice
Board of the company at its Registered Office and its Head Office as well as Corporate Office,
■ The results of voting alongwith the scrutinizer’s report shall also be placed on the website of the
company,
■ In case of companies whose equity shares are listed on a recognized stock exchange, the
company shall, simultaneously, forward the results to the concerned stock exchange or exchanges
where its equity shares are listed
Voting
■ Demand for Poll (Section 109)
■ Before or on the declaration of the result of the voting on any resolution on show of hands, a
poll may be ordered to be taken by the Chairman of the meeting on his own motion, and shall
be ordered to be taken by him on a demand made in that behalf by the following person(s):
■ (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 Rs.5,00,000/- or such higher amount as
may be prescribed, 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.
■ A poll shall be taken at such time, not being later than 48 hours from the time when the
demand was made on any other question.
■ The Chairman shall announce the date, venue and time of taking the poll to enable members
to have adequate and convenient opportunity to exercise their votes
■ The result of the poll shall be deemed to be the decision of the meeting on the resolution on
which the poll was taken.
Voting
■ Postal Ballot (Section 110)
■ As per section 2(65) “postal ballot” means voting by post or through any electronic mode.
■ Each item proposed to be passed through postal ballot shall be in the form of a Resolution
and shall be accompanied by an explanatory statement which shall set out all 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
■ A company shall send a notice and draft resolution by registered post to all shareholders
explaining the reasons and requesting them to send their assent or dissent in writing on a
postal ballot.
■ If a resolution is assented to by the requisite majority(3:1 for special resolution and majority
for ordinary resolution) of the shareholders by means of postal ballot, it shall be deemed to
have been duly passed at a general meeting convened in that behalf.
Voting
■ Company may transact such items of business as the Central Government may, by
notification, declare to be transacted only by means of postal ballot.
■ In case of companies which are required to provide facility to members to vote by electronic
means under section 108, the Act now makes it non mandatory for these companies to
transact business through postal ballet.
■ A company may use postal ballot for transacting any item of business, other than
■ Ordinary business and
■ Any business in respect of which directors or auditors have a right to be heard at any meeting
 Voting
■ Business to be transacted through postal ballot: The following items of business shall be transacted only by means of
voting through postal ballot:
■ (a) 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;
■ (b) Alteration of articles of association in relation to insertion or removal of provisions defining a private company.
■ (c) Change in place of registered office outside the local limits of any city, town or village.
■ (d) Change in objects for which a company has raised money from public through prospectus and still has any
unutilized amount out of the money so raised.
■ (e) Issue of shares with differential rights as to voting or dividend or otherwise.
■ (f) Variation in the rights attached to a class of shares or debentures or other securities.
■ (g) Buy-back of shares by a company.
■ (h) Election of a ‘small shareholders’ director.
■ (i) Sale of the whole or substantially the whole of an undertaking of a company.
■ (j) Giving loans or extending guarantee or providing security exceeding 60% of its paid up share capital, free reserves
and securities premium account or 100% of its free reserves and securities premium account.
■ (k) any other resolution prescribed under any applicable law, rules or regulations.
 Voting
■ Following companies are not required to transact any business through postal ballot.
■ (i) One person company
■ (ii) All other companies having members up to 200.
■ SS-2 provides that 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
ballot instead of transacting such business at a General Meeting.
■ Ordinary Business shall not be transacted by means of a postal ballot.
Voting
■ Procedure of postal ballot
– Notice to all shareholders
– Mode of sending documents
– Publishing of an advertisement
– Notice to be placed on the website
– Appointment of scrutinizer
– Safe custody of registers and papers
– Submission of report of the scrutinizer
– Maintenance of register by the Scrutinizer
– Preservation of postal ballots
– Reply from members – Within 30 days of notice
– Declaration of result
– Resolution deemed to be passed in general meeting
Voting
■ A postal ballot form shall 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 ballot 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;
■ (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 ballot form is received after the last date prescribed;
■ (h) The postal ballot 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 calls;
■ (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.
Circulation of Resolution
■ As per Section 111, a company shall, on requisition in writing of certain number of members,
give notice to members of any proposed resolution intended to be moved in the meeting or
circulate any statement with respect to matters referred in proposed resolution.
■ The company shall be bound to give notice of resolution only if the requisition is deposited
not less than six weeks before the meeting.
■ In case of other requisition not less than 2 weeks before the meeting.
■ The statement need not be circulated if the Central Government declares that the right
conferred is being abused to secure needless publicity for defamatory matters.
■ If default is made the company and every officer of the company shall be punishable with
fine
Minutes of Meeting
■ Minutes refer to a written record of business transacted at a meeting
■ Section 118 provides that every company shall prepare, sign and keep minutes of
proceedings of every general meeting, including the meeting
– called by the requisitionists and all proceedings of meeting of any
– class of shareholders or
– creditors or
– Board of Directors or committee of the Board
■ And also resolution passed by postal ballot within thirty days of the conclusion of every such
meeting concerned.
■ The chairman shall exercise his absolute discretion in respect of inclusion or non-inclusion of
the matters which is regarded as defamatory of any person, irrelevant or detrimental to
company’s interest in the minutes
■ Minutes kept shall be evidence of the proceedings recorded in a meeting and containing fair
and correct summary of the proceeding thereat
 Minutes of Meeting – Secretarial Standards

■ Minutes shall be recorded in books maintained for that purpose.

– A distinct Minutes Book shall be maintained for Meetings of the Members of the
company, creditors and others as may be required under the Act
– Resolutions passed by postal ballot shall be recorded in the Minutes book of General
Meetings
■ Precautions to be taken while preparing the minutes:
– Uniformity in the manner of maintaining minutes
– Page Numbering- Should be consecutive
– Binding of minutes
– Place of keeping minutes – Registered office or such other place, approved by board
Minutes of Meeting – Secretarial Standards

■ Contents of Minutes
■ General Contents
■ Name of the company, day, date, venue and time of commencement and conclusion
of the Meeting
■ Adjourned meeting
■ The names of the Directors and the Company Secretary present at the Meeting.
■ The names of the Directors shall 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.
Minutes of Meeting – Secretarial Standards
■ Specific Contents
– The Record of election, if any, of the Chairman of the Meeting.
– The fact that certain registers, documents, the Auditor’s Report and Secretarial Audit
Report, as prescribed under the Act were available for inspection.
– The Record of presence of Quorum.
– The number of Members present in person including representatives.
– The number of proxies and the number of shares represented by them.
– The presence of the Chairmen of the Audit Committee, Nomination and Remuneration
Committee and Stakeholders Relationship Committee or their authorised
representatives.
– The presence if any, of the Secretarial Auditor, the Auditors, or their authorised
representatives, the Court/Tribunal appointed observers or scrutinisers.
Minutes of Meeting – Secretarial Standards
■ Specific Contents
– Summary of the opening remarks of the Chairman.
– Reading of qualifications, observations or comments or other remarks on the financial
transactions or matters which have any adverse effect on the functioning of the
company, as mentioned in the report of the Auditors.
– Reading of qualifications, observations or comments or other remarks as mentioned in
the report of the Secretarial Auditor.
– Summary of the clarifications provided on various Agenda Items.
– 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
– In the case of poll, the names of scrutinisers appointed and the number of votes cast in
favour and against the Resolution and invalid votes
– 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.
Minutes of Meeting – Secretarial Standards

■ Minutes of E-Voting and postal ballot:

■ SS-2 provides that in respect of Resolutions passed by e-voting or postal ballot, a brief report
on the same including the Resolution proposed, the result of the voting thereon and the
summary of the scrutiniser’s report shall 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 ballot.
Minutes of Meeting – Secretarial Standards
■ Recording of Minutes
■ Minutes shall contain a fair and correct summary of the proceedings of the Meeting. 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 shall record
the proceedings. The Chairman shall ensure that the proceedings of the Meeting are correctly
recorded.
■ Minutes shall be written in clear, concise and plain language. Minutes shall be written in third
person and past tense. Resolutions shall however be written in present tense.
■ Minutes need not be an exact transcript of the proceedings at the Meeting.
■ Each item of business taken up at the Meeting shall be numbered for reference or cross-
reference
■ Minutes shall be entered in the Minutes Book within thirty days from the date of conclusion of the
Meeting.
■ Minutes of a General Meeting shall be signed and dated by the Chairman of the Meeting
■ The Chairman shall 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
■ If the Minutes are maintained in electronic form, the Chairman shall sign the Minutes digitally.
 Minutes of Meeting – Provisions
■ Distinct minute book for each type of meeting
■ Manner of maintenance of minutes
■ Manner of signing of minutes
■ Preservation of minutes book:
– Minute books of general meetings shall be kept at the registered office of the company
– Minutes of the Board and committee meetings shall be kept at the registered office or
at such other place as may be approved by the Board
– Minutes of all Meetings shall be preserved permanently in physical or in electronic form
with Timestamp.
– Minutes books shall be preserved permanently and kept in the custody of the company
secretary of the company or any director duly authorized by the Board
References

■ Company Law study material by ICSI

■ G.K. Kapoor and Sanjay Dhamija, Taxmann’s Company Law, 20th Edition, Taxmann
Publication
Thank You