Company Law TTT CS tater [ Executive, © cA PET! Per INDEX sree ContENTS Pace No. f L | AGM Provisions with @uesHous and Answers ly-z 2. [Adjournment of Meehwys 3 3 | Nobice oF Adjourned Meeting 4 4. |@uorum. Provisions LSection-174] 5-6 S. | Proxy Provisiows [ Secton-176] Té 6 | Demand for Poll [ sectious-179] g % |Chairman's Fowexr and casting. vote. Lo & | Nomination of Shares [Sechen-1o9A] 14-12 9. | foiuts on transfer of shares 13 jo. | Registerahon. of Charges L416 tt. | Certification of Transfer [ Section-112] 1718 1g. | Company Divideud 1g 13, [Distinction between Fixed + Floatingchorge | 20 14. | Investment held in Companys name[sec-ug] | 2L 1s. [Compulsory Resol for Postal Ballot [sec-i92A] } 22 Prepared bys — Ankur GARG (Company Seckerary]Seet66 ” AninuaL GENERAL MEETING” Rules or the principles of extensions for holding AGM. 4) The extension. can be granted owly by :0.C. vot by DCA ov CLB. 2) Edension will be granted owy for special veasous® 3 The application for the extension shall be fled withive or before the exprry of more stringent time Limit, UJ Extension is qrauted oul for Original AGM. and wok for the adjourned meee. + \ustences of sufficieud cause /veason': C) Seizwu of Account book by Police ==> Yes W) Now compliance. oF stabulory Audit Report —> Kio x Qi) Now preperation, of accounte es No x ) Natwul colanaity- =—>p- * giant Now- preperation. oF Accounts DEA Clavificakion:- DEA has clarified thar AGM shalt be. convened and abl the business shalt be transacted as per the Agenda ia tw AG&™ except the adoption. of Accounts Then the AGM Shalt be [adjourned Jand the adoption of accounts shall be dene atthe adjovmed 4am . Bub such adjourned AGitt shall also be convened within the more. stringent Hime Limit vorms otherwise Fue ws 210. More strivgenktime Limits See 166 vead with Sec- 210,Guestion- Answer ow Secléa CAGM) Guar Caw two Aeim'’s be convened on a single day ? Aseh Yes, Reason being this is nok pchibit anywhere fn. Companies Act, 1956 The Ror of lash year canbe convened on. the same day, when the fem of current year. is propesed tobe convened. of Sigle notice is sufFicent of the above 2. Ams Gusi2_|s it necessary to hold AGM iF the Company cocued fo continue its business ? fwsr2 Yes. As itis stadudory requiremenk u/s 166 , 210 Fu the wivdiy up of the company. Coser Madan Gopal day Vs- Stafeof West Bengal . Gusr3 iP the noticeof AGM issued by te C5. or MD without Hac euathovity of Board, whether the AGM ts valid or invalid? fas, If the board of directors vatify the votice before the AM is had then the AGM s hall be vatid otherwise vol. journed Guar Can we convenec HEN cn a public. holiday? Pus Yes, CIF adpuved fox want of quorum, then very much possible. Bh A E No quorum. preseut-®) Adjourved to Hae mext war vys 174 (4) iste E / L-» Quite ese because. Adjourned AGM be maybe held ona public Lrabiolany ‘Adjoumed AGM ona Public hatiday Coutinues... . © Original. AGM ow Mowday- : 6 business trav sacked 2 Remalws Voluwlary Adjounemeuk to comivg Sunday. e o law is silewt @ Poiuk is yet tobe tested fu Laws © No DCA Clarification. TH Since Law is silent it seews thal: such Ady- AGM caw be convened on a public holiday, However a4 a geod. corporate. Grovernance. practice. and qoing by the essence. of Sechon-166(2), its howd not-be convened. CONCLRSION i> For wank of quorum. fortransachivg He balance bsn. Sec 114 (4) | j bli fdjournmeuk to a public Adjournment to a. public roy ve pose ar holiday is not possible. © Stahutory Gren Meehug- LL @ Adjourned 5.G-M- eo @ Annual Gemerat Meekiug- x @ Adjourned Agr. Gat eu) © ExhaorLvory Gen Mechivg ve \- Comparahve Table. for Annual General Meetug— ve eo te Le LO ® Adjoumed E.G". ueNotice of Adjourned Meehug ® Adjourned by Fhe cm] | Adjourned for want| | Acjounement Rr withtheconsent of | | oF quorum. Long time perted members TN Lay so daus v a. The date, times No suchdale . Place of adj Aen | | time is next week Regul 53(3) isdécided att fixed Sametime, of Table-A hineot adj. « Same Place | Indefinite, : i a days 1 : ' te Simedia Ady Y i "Not ees . ot eo h @ Fresh Notice, lo rresh No fresh 5 is read aA vead Nea \ . Netice = Nohce for original no “es requ es] *FreswNictice, Re as Regd Meohig SITE (XD 1s required ) © + Because Sect74(a) Adjourned for Caodays Adjourned far > 3edays frosh Notice is required Fresk Notre regd (May be news paper adv.) as per SeeL7L @cA Says Hat.) Regulahen. $303) of Table A_ @~ twhen.a meeiny. is adjourned for a0 days or more ,Nohce of Adjourned Muctug- Shalt be given. as fu. case of criginal mectivg, as AnuR Gir RG [Company Secrerany]Secite @uorum for General Meetiug. © Rules for quorum. yOwly the members personally present are counted forthe purpose of quorum... (Except See 167, Be} om maw quevunt 23 Owly Equity shareholder count for quorum. . =? DCA has claxi fied that iw General Hu equity shares holders are counted tw quorum. bul te. pref. shar hold ers may be counted iv the quorum iF there is any business i the Agenda offectiug the Preference sharehslders . 3) The number of members moy get yeduced below: 5 bur subsequently shall wok get reduced below 2, uy Joiuk shareholders are counted as one. for quorum. 3 [Sectiont07]—> “The vepresenlahve of body corperale appoiuted Hhrough tha bead resoullion, is counted as member personally present 6 (Secto7A} The vepresentative. of He presideut or the. gover ner are counted as member persovally present ju, the General Meeting for the purpose. of quoru. @usi- Com Hae represen tatives meutioned above., appoimla. proxy fo vote. ov their behalf Pus Yes, As per section —Le7ta), itis possible . By interpreta section —1e Tt) we moy soy tal for the purpose. of appolatmeut oF proxy , such we preseutatives of Governor or Presideuk shall be considered as member of Co, a person. is preseul- iv the smeebingas a member himself and also os @ representative of tue body corporates u/s 187, fhen he will be counted as 3 rember personably present.Section-174 Guru, aud ©) Sechou-L#6 Prony Situation. Situation:-2 Me A CMomber) + Mr B (Member) Mr. A (Member) = Sd hs vepregedahve, As vepreseutative. of o xX Ud. ¥ Lid. 2 Ud Pili Gtid Rud Std Gus: whether quorum is preseut 2! Guus whether quown is preseub Aus: Yes, for betty Public # Aus Privale Co. quorum. is preseul- Situahen 3 In @ public company having. 7 members, 4 members Lied iw am air crash + there shares were trams mitted to 3 sey vivivg, members Qua ~ whakusi it be the position. of quorum in Hus Company? Awsis_\Poll 3 members personally pereseuf than sufficient quorum . Ove Mav Quorum. © Seete7 — AGrrt by GLB. Com) @® SecBe — EGeMt by cL CTribuval) @ Sec 6 — Claw Meekvgs Cusheve ont persou covstiture Hie eutive class)Seel¥6 Proxy @ = Any ome jout shareholder can sin the proxy form and. it Ts not required that the proxy form should be signed by the all. joiut holders =P According to Rawmiya." In case of Jol members all must si the proxy form, onless Articles enables one joiuk holder to sig. Situations Mx [appoint —> my. PL (Pr avd ; "vali General Hei Mr ¥ Mr. Po (Proxy) , 500 Shaves Invalid vole) Situations? | Mr A} — Mr. P (tis Creu. Mesig avd caw of Tabie'# adopled then auswer is Mr. & CPs vote Is valid) Requbalion~ 57 of Table"A’ i" In case of joinb holders the vole of senior who tevders a vole, whether In person. ov proxy, Sha. be. accepted to the exclusion of the votes of other joint holders.” a Foy Hs purpose. seviovity shall be determined by the order im which Ha names stand ju the register ef members. Revocation, OF Prox Express Revocation. ¥ By cen evocation bolo. (Dif the member hamsel veaches Such letter shatl reach thechalmave the Gren Mug & particopale 1m before proxy parhicipale in tw poll. the pall before the proxy - Eoxtlien Vote. of Proxy Vabid 2 @ ft another valid proxy form. Example !- Suppose lettet receive before item. is subyitted to the company, Ho. 69,10 aud Proxy has given b's @) Death or insanity of He votes for item 4 toF thn the vote member. bop ky el bh he wma obSituation 4 (fs) ie) a ® (f « 48 Hoses ga Sooswos [LeSepl] [22 5ept ; yo Scoo.Shaws — S0oShare ' lo A.M. [B7SEPEPX wadyony But iF Arhche authorise tren, Jowwds, Vaid © Prox Proxy appointed fororginal. Meekug. j is also valid for General Meetivg, which is adjowued') Qe proxy canbe. appointed for an adjourned meeting: though himself alterded the orginal General Muhive- Situahion -2 Mr . = yeHours AS" Soo shares} — Signed > Signed & (5A dis palched ove oe Yu bE es for Seo Shae ioe se Reach pnctursinuahon + iF 2oMoy if 24 Mas. tacenfoy Cry => Reaching Date.is relevant, to 0M 20 Auguk — 2.9 the extent calcwahug 48 hows, Signahue. *s nb a FR, veaches ov 24 August tho PL weud be valid Prony.Section-179 Demand. for foil - “Who cau, demand oll” tw case of Co.c) having Share Capi kal {w Case Co.ts) nat havlvg- Public. Co. PrivaleCo. Share Capital Any member or Members | ©iF Fh members pore Public Co. + Private Co. present im person.or proxy | Present im Har GM < 7 Any member present Htwxany member present in ) Iv. personov by proxy Person orby proxy cam. olding £ eo demand pall Gecemample:®)\ 4s ee iF Hee members personally ) vesolution, marydemavd present are >7, Hun any2 | Py rnembers present in Person holding atleast 4/19 volt Power with respect fo Ha tesoluhion.. (oR) @® Any member present Iv person.or by proxy holdh a paidup Copi. of % Se.000 sy ea Example: ® InGreneval Meeting- ae, Presenk=10 B en Preseat Lo Person Preseut = Lo LOutof them}: 2 Proxies } 4 often holda Tout of them] = 4 Proxies _ 7 rlembers /2 Proxies | | Proxyotso CG Member /1 Cr ert | : Member +4 Proxy [iene | 2. Members / can domand Pall Such (trterber +1 Prox?) Candomand Poll Qused Con Chairman. of General, Mecha. askud Oder fer a. poll. straight away without ordering the show of hands. Avsid (0) he can. not de. $0. Guprd Canthe chairman over for POLL shraught cway withouk Hirst ordering, the Show of hands, iPelenmand for Poll received vis £79. Avsrg ), LF demanded - ih folling results are cholLengable. but show of hands cannot be. challenged if entered fu tw Minute book. . y Kup the polling papers safe HU they Checked or iuspecled. &k fs soon as the poll is demended the result of shour of hands is nuitied.Adjournment fower of Charman. CHAIRMANS Powe Rs ,~ Reavietion= 230 ae Adjourn the Gut vot tae Adjourned the Gt if so cousent of Members dbrected by the Munbers Notes In case of Violance inthe Mehiuge inherant power to adjourned /oy fo ovderthe odjournement. => The chairman has Hae. Casting: VoTE Tor example In Board Meeting => U-ty (Votes equally s pit) Cashive, Vote of Chairman. (incase of equality of votes) See 1080)= (GR) (ortngacto cane, ave + breaking dead lect) sons EHaicg gover (icomncrltetinga) (he Sand Metnp — TY Company Appoiuted by way of Hecan also give cashive, Regulation 76(1) vote_ if requived J CAF weed is Howe) He cam que. casting vole Reg uiahiovi-%6 (2) The beard elect & Chairman of its wmeehivg and determi ve the peried for which he is toheld offce.Sec- 109 A Nomination. of shares © Gueshon' Where the nomination is made by. He joie Sharehalders bub ove of them passed Whether the Suaviving share holders has the vight to cancel the nomnation and make a news nominahon . © Auer Yes. @ . Situation : Hoe seld Iie shane @ ela) ww Nominadion. becomes invalid erinaie automatically / jwmedia toby 8) dituation:@) (q) ake a doar, @ Pledges bas shares iu -Raveur Nowineled Z of Bank (WD On Ha expiry of 6 months, x clefadlted oN i repayment of lean and Bank, "Er Z] forPeited tha shares. of Nomination becomes invalid automatically. LY Simply Pledgivg the shares— Nomination. Siuatione® remains valid i on _ Mr. A »— GD py @ Nomination, we B GD Died oy shaves will be given to te Ligat lrelrof Mv. B.Sitaion@) [Mek} Died [Ph I~ — Gay ed i Since Im Has Situation. Nominee Mr.L died before MnK, Nominatioustands cancelled and shares usltt be. qivento ddegal heirs of MK @Gusr iF both Mri or Mb. died on he same day. who us 2h be ewhtlid fo tu shares, Aws!= Shares usibl be qivente Legal heirs of My. K Certain important poiuts warts Transfer of shart, 4) A public company yefuse to transfer the shares m favour ofa person [who Is company’s own. employee] on the. suspecion. Hhat when such person. attended the GrM. mewill couse nulence . 2) Director of a. Company Cannot] refuse to register the tansterou the ground thal proposed transferee. has mavle attempts iv. the past to windup the Company. 3) Directors of a company canvot] refuse to register Hae, transfer ofshares in favowr of proposed transferee onthe ground that he is a business vival. 4) Disectors of a company vefuse to register the transfer of shares without communicating. the grounds of refusal.Fransfer of Shanes @) Some. important poiuts :~ LY Rejected Transfer deed returned to the transferee =~ The CLB has pointed out that the Co.on not registering the. transiey Showd have returmed the documents to the. party who lodged Hem, (the transferee) avid. not the transferor as the transferor losses his right Im the shares as soon as he executes the transfer in blank. 2) Priority amovg. transferees !- Where a shareholder has Fraudulenbly. Sod Wis shares bo two obffereut transferees, the first purchaser will, on the ground of time alone, be ent bled to the shares ia priovity to the setond Ex A person — assigned property + shares — te creditors . Creditor fouled to register shares inlus name—butgive nobice of ascignnewt. to Co, Laberon Assignor(A Rersov) sold them— to someone else. Held — Assignee'’s Claim.— prior iv Hme— So he is entitled to shaves. 3) Pledgivg of Shares g— Shares of a company-can be a subject matter ofa valid. pledge As per Sec cz) of Sale of Gionds fick, 1930, tre definition of Geods includes stocks and shaves. So ints Ce 4) Trans position of name s- \w case of joint share holders one or more of them may require the, Co. fo abter or rearrange. the serial ower of their names iM the. register of member of Co. Im Hus process there wittbe need for effeching- consequential changes, iv the share certificale issued to them. The reques of transposition may be dluly cousidered 4 approved by fhe board : Since no transher of any Inlevest in the sharestuken. place the question. of insistiv, on Filivy tran dead vot arise - => There. is no need of execution of trancleed for the. transposition. of name. iF the vequest for change. inthe over of ynames wos made fv write.Transfer of Shares Continues. ...- @ @us-l Transferor or transferee execute the Share tun deed and deposited the same. with the company along with the share. certificate —-The transfer is pending —— meanwhile He. company amended the articles fo insert a neutground, of vefusal.. Nowcan. The company vefuse. the above transfer of shaves on this neur ground. Awarh (Amendment will havethe prospective effeck) Qus:2 (where the sharetransfer committee 's deleqaled the power to register the transfer of shane then whether such committee has the inherant power fo refuse the transfer ? Aus: 2. (Ne) No imberant power available to committer above. REGISTERATION Or CHARGES ae ae Consequences of non- registeration. of charge in (B= Charye becomes void. agaietes-against Liq uddatoy 2 other creditors, (=> Charge remains valid against the. Company till Hae Company is a going concem., 1€- (it remains enforceable against the G-) Loan for 6 Years Company is a going. sedys ede Ato Registration. (0) Concern, As perSec 5 & Years Ow the expiry of 6 Years Co. de faubted iv repoymenf- f Lea, Charge. vemains valid ¢ ouforéeable agaimt tule @ Stamp Ack complied -—~ (ii) Registeration Ack Complied L-— (ii) Companies Ad Complied yyLoan. for & Years Loan For 7 Years PDBL [SBT (icier : No Regn. 4 wis” | Gag co dee i > >| — repay mpl of SOI Leon = eo SBI got cro ‘existe a be Foch *° at Stamp Acki- Stamp Ack waht oF ‘cel Repn: ack O®Ak& WGrdbr a Charye of ICICI gels the Prioriby- over the charge. ceated im favour of SBE Concusion t- Regu Ack (See 1ut(3)) Even though the $8? has oblained the vechficalion. of charge. Register from CLB im 2004 , shLl the charye. iM. favour of s8T with vemaln void agaiwst ICICT bub it shath hold geod. agaist tDer CSec tut@)) . “yes Lads5 Years Leave Winding up of the. Company im ay 2660 => The charge is voidagaiust Lguidator avd. theretore. the. Liquidator will treat the TDBI as Unsecured creditors gto (o-4-1999) (ts=U-1999) (25-4-1944) (05-05-1998) Charge créaked by the.Co. iu favowe oF A > Charge o on the Same. property im Faveuy of B G5 Doys ) Gus Who will getthe priority ? / oy a Aus: There are 2 different views veqarclang priority. 1 such situahon 1) First Vieux D> * 9” should be. given. priority once forall. 2) Second View D> *B" Shall be given the priority over"A” duxivy 25-4-99 to 04-05-99 But ‘AY shalt be given Hho priority from. 5-5-9449 onwards. lore appropriale. Views is Second viewras It carvdes te intention of Lavy.Sec t12 Contification of Transfer G) Section scheme aba Glance TransFer. Tronsmission Situahon-1 Me. Ae B signi the shove ‘vrenetl Sec 10g Sec- 409 deed for sale. of 3e0 Sec Lo Sec- 109 A Shares out of Soo Sec 442 Sec- 1098 Shaves of Mr. A : theveafler Sec 111 PG [Common Sec 144 A-PabCe | Sections delivers Share CertiPeake (Sco shave) Shave tan deed 300 shaves) Corpany > Fes Retains shou. Certificale Returns 7. » Forward} with the word “CERTIFICATE LODGED” wD chanel Balance Tickel (00 shaus) y ay dud [7B] Coctiticale “ted (at this poiuk of time MB is sakisfied ¥ Fair intention of My.4 to tan. W's shar bo 8. and & pays Pur: Cousi.to A.) yece’n Now 2 “ tan ‘aa ; " Neo Shane contifizae. (el . Go will be iscued by tu Co. wee ele ee - “heb etoeneiae Feceipt of Bakanee Heckel trom A and shautran deed from BSects? Cestificabon. of Trans fee. 1) Situation 2. thereafter | Share. Certificale (S00 shares) | _»shave Tran: deed (200 shares) 1» Share Trou: ceed (300 shaves) [Rig he cae] Rohunvs Shane tran-deed (200 shares) D Stare tram: deed (200 shares) (withthe words certificake Lodyed) Q Share transfer deed to BEC Goosh) sh-tawdad Sh traw deed (200 slave) A . tek oN, a a6 Or x ce ComPany fo? Qualifieahon shares Teler Ud}-~. . \ Give ® Crove. ‘S ICICl appoints Mr-2 as nominee Loam for fo Yrs. p director im xyz Ltd tox7z Ud “ The Articles oF XYZ. Ltd. provides for quali" shaves Interpretation t- Section- 4902) says ICICI can purchase Hat shares iv the nameoF its nominee divector. Because heve 1clC} 's depubiuy Mv.Z iw xv2 Ud: as nominat decoy, = See 43(2) To waintal s- 1+6=7members Ciwhiehis shahaloy miu. incase wholly owned Subsidiany Co. of Pub.Co.) hkerpretation:- Heve if H Lid. pays on behalf of A,8.6.D,E,F the volus of there L Shave ten it is He. Astle same payment is fomainluin min 7 members in corcof Pub. Co. 8— Sec. -ug9(4) Investment Company can male the investmeyt- jn te. name. of other Companies / Persous.Companies (Passing oF Resolution. by Postal Ballot) Rules, 2001 The. Business which have been specifreal by Ceutval Grove. fo be conducted ouly through Postal Ballet ave followny- 2 LY Adleration im the object clase of Memorandum. 2) Alferation of Articles in relation to insertion of provisions definivg private. Com pony . x3 Buy back ofown. share by the company under Sec T7A (1), 4) \ssue of shaves with differential votive rights asto voting. or dividend or otherwise. under Sec-86(a) (iD. 5) Change iu the place of Regal: office outside Lecal Limits oFany city, tpwve or village as specthed i. Sec-Lh6(2) . G)sale of whole. or substantolly the whole of undertakivg- oF a company as specified tm Section~243(t)(a), 'b Givivy loaws or extencing quarantee or providing security iv. excess of the Limits prescribed in Sec 372A (4). 8) Elechow of a divector under proviso to Sec~252(1) of the Companies ACE, 1956. (Small Sharsholelir's di've cher) ) variation in the vignts attached to a class of shares ov debentures or other Secwuhes as specified fw section- 106. _ AnKva GARG Q@.¢-5,)