CS Jyoti Srivastva

Jyoti Srivastva

The Institute of Company Secretaries of India (ICSI) has recently revised the Secretarial Standard on Meeting of the Board of Directors (SS 1) and General Meeting (SS 2). The enforce ability of SS 1 and SS 2 comes from the provisions of section 118(10) of the Companies Act, 2013 (Act, 2013). The earlier SS 1 and SS 2 were made effective from 1st July 2015. However, with effect from 30th September, 2017 the text of earlier SS 1 and SS 2 will be withdrawn and revised SS 1 and 2 shall be applicable to the Companies with effect from 1st October 2017. Here the Author has tried to analyses the major changes made in the revised text of SS 2 along with the impact of such changes. Majority of the changes have been made to make the provisions of SS 2 in line with the Companies Act, 2013 and to provide exemption to the private companies in line with MCA exemption notification dated 5th June 2015.

Sr No.

 

Head/Para no. Existing Text Revised Text Remarks
1. Scope This Standard is applicable to all types of General Meetings of all companies incorporated under the Act except One Person Company (OPC) and class or classes of companies which are exempted by the Central Government through notification This Standard is applicable to all types of General Meetings of all companies incorporated under the Act except One Person Company (OPC) and a company licensed under Section 8 of the Companies Act, 2013 or corresponding provisions of any previous enactment thereof.

However, Section 8 companies need to comply with the applicable provisions of the Act relating to General Meetings.

Insertion has been made to give exemption to section 8 companies from the compliance of SS 2. This change has been made in line with the exemption notification dated 5th June 2015 wherein it was stated that section 118 (section from which enforce ability of SS comes) shall not apply except that minutes 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.

The addition of second para clearly state that the provision of Act 2013 shall be applicable with respect to General Meetings.

2. Definition “National Holiday” includes 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. “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. The earlier definition was inclusive. Now it has been made exhaustive. Similar change has been made in SS 1.
3. Definition “Secretarial Auditor” means a Company Secretary in Practice appointed in pursuance of the Act to conduct the secretarial audit of the company. 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. A firm of Company Secretary(ies) in Practice would also get covered under the definition of Secretarial Auditor.
4. 1.2.1 In case of a Nidhi, Notice may be served individually 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. This para has been added to make the SS in line with the MCA Exemption notification dated 5th June 2015.

 

 

5. Explanation 2 to para 1.2.2 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 shall be retained by or on behalf of the company as ‘‘proof of sending’’. 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 shall be retained by or on behalf of the company as “proof of sending” for such period as decided by the Board, which shall not be less than three years from the date of the Meeting. This addition is quite logical. Earlier it was not clear for how long the proof of sending should be kept by the companies. Now it has been made clear that the proof required to be preserved for a period of at least 3 years or such higher period as decided by the Board.

However, Rule 18 of the Companies (Management and Administration) Rules, 2014 is silent on the period of preservation.

6. 2nd last explanation to 1.2.2 If a Member requests for delivery of Notice through a particular mode, other than one of those listed above, 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. If a Member requests for delivery of Notice through a particular mode, other than the one followed 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. Registered post or speed post or courier or e-mail- these four means are prescribed for sending notices. As per earlier text if the Company chooses to send notices through courier and if a shareholder asks for notice via speed post- then there was no need to pay fee for such mode as the same is one of those prescribed mode. After eliminating the prescribed four mode there hardly remains any other mode for which a shareholder may ask for. Now the shareholder need to pay for any such mode other than the mode of service followed by the Company. This is in line with section 20 of the Act 2013.
7. 1.2.3 In case of companies having a website, the Notice shall be hosted on the website. In case of companies having a website, the Notice shall simultaneously be hosted on the website till the conclusion of the Meeting.

 

The Earlier provisions of Act 2013 or SS 2 were not clear on the timeline for keeping the notice on its website. Now it has been clarified vide SS 2 that the notice of a General Meeting may be removed from the website after conclusion of the meeting.
8. Explanation to para 1.2.3 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. An explanation has been added to para 1.2.3. This is in line with Exemption notification dated 5th June 2015 which states that sections 101 which pertains to notice shall apply to private companies unless otherwise specified in respective sections or the articles of the company provide otherwise.
9. Explanation to para 1.2.4 Notice of Annual General Meeting shall also specify the serial number of the Meeting. This will not impact much as the Companies were usually following this practice earlier as well.
10. 1.2.4 Notice shall contain complete particulars of the venue of the Meeting including route map and prominent land mark for easy location. In case of companies having a website, the route map shall be hosted along with the Notice on the website. Notice shall contain complete 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;

(ii) a wholly owned subsidiary.

The requirement of providing route map and land mark for the venue of General Meeting comes from the provision of SS 2 only. Now, SS 2 has provided an exemption from giving route map and land mark in notice to the closely held companies i.e the companies where only its directors and their relatives are members and also to the wholly owned subsidiary.
11. 1.2.4 Meetings shall be called during business hours, i.e., between 9 a.m. and 6 p.m., on a day that is not a National Holiday. A Meeting called by the requisitionists shall be convened only on a working day. An Annual General Meeting and a Meeting called by the requisitionists shall be called during business hours, i.e., between 9 a.m. and 6 p.m., on a day that is not a National Holiday. The term Meeting has been replaced with AGM to make it in line with section 96 of the Act 2013. Further, as per Section 100 (2) of Act, 2013 read with Rule 17 of the Companies (Management and Administration) Rules, 2014 the extraordinary general meeting on requisition should be convened on on any day except national holiday. The aforesaid Rule was substituted by the Companies (Management and Administration) Amendment Rules, 2016 and prior to substitution words used were ‘on working day’.  Therefore, this change is in line with the Companies (Management and Administration) Amendment Rules, 2016

Hence, the EGM on requisition may even be called on Sunday provided that Sunday is not a National Holiday.

12. 1.2.4 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.

 

This has been inserted in line with MCA exemption notification dated 5th June 2015.

However, MCA vide further notification dated 13 June 2017 amended the aforesaid exemption notification also to include ‘such other place within the city, town or village in which the Registered Office is situated’ where AGM of Govt companies may be held. It seems that this change has not been considered in the revised text of SS 2.

13. 1.2.4 In case of companies where Proxy shall be a Member under the Act, a statement to that effect shall appear in the Notice prominently. 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. Section 105 read with Rule 19 clearly provides a restriction on appointment of proxy in case of Section 8 companies. It clearly states that the proxies should be a member of the company.

By removing this, SS 2 has created an ambiguity. Corresponding to this change, changes has also been made in para 6.1 of SS 2. The both changes contradict with the provision of Act 2013.

Further the addition is in line  with exemption notification dated 5th June 2015 wherein it was stated that section 105 i.e relating to proxy shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.

14. 1.2.5 In respect of items of Ordinary Business, Resolutions are not required to be stated in the Notice except where the Auditors or Directors to be appointed are other than the retiring Auditors or Directors, as the case may be. In respect of items of Ordinary Business, Resolutions are not required to be stated in the Notice. It is a well-established fact that for ordinary business resolutions are not required. However, if we look into the requirements of form ADT-1 that is with respect to the appointment of an Auditor, the form asks for a mandatory attachment that is a ‘copy of resolution passed by the Company’. Keeping in mind the aforesaid requirement it would be better to include a resolution for appointment of auditor.
15. 1.2.5 In case of a private company, explanatory statement shall comply with the above requirements, unless otherwise provided in the Articles. This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining explanatory statement i.e. section 102 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
16. 1.2.6 In case of a private company, the period of sending Notice including accompanying documents shall be as stated above, unless otherwise provided in the Articles. Same as above.
17. 1.2.6 In case of companies having a website, such Notice shall also be hosted on the website. In case of companies having a website, such Notice shall simultaneously be hosted on the website. This should also be worded as per para 1.2.3. Once again it left an ambiguity as for how long the newspaper advertisement of the special Notice received from Member under the Act should be there on the website of the Company.
18. 1.2.7 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 date fixed for the Meeting from 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 percent of the Members entitled to vote at such Meeting. The word ‘date’ has been replaced with ‘time’- that’s the only difference here. That is to say even on the date of the meeting the consent may be received provided the same is received prior to the starting of the meeting.

 

It is pertinent to mention here that the revised text has not considered the changes that is proposed vide Companies (Amendment) Bill, 2017.

19. 1.2.7 The company shall ensure compliance of provisions relating to appointment of Proxy unless all the Members entitled to vote at such Meeting, consent to holding of the General Meeting at shorter Notice. Considering the fact that proxy form needs to be submitted 48 hours prior to the date of meeting, it has been prescribed that in case the meeting is called on shorter notice the company has to ensure that all the Members entitled to vote at such Meeting gives their consent to hold such meeting on shorter notice. Otherwise the entire provisions of proxy shall become applicable and the purpose of shorter notice meeting may get frustrated.
20. 1.2.7 In case of a private company, consent for shorter Notice shall be obtained from such number of members as specified in this para, unless otherwise provided in the Articles.

 

This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to notice i.e. section 101 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
21. 4.1.1 The Chairman of the Audit Committee, Nomination and Remuneration Committee and the Stakeholders Relationship Committee, or any other Member of any such Committee authorized by the Chairman of the Committee to attend on his behalf, shall attend the General Meeting. The Chairman of the Audit Committee, Nomination and Remuneration Committee and the Stakeholders Relationship Committee, or any other Member of any such Committee authorized by the Chairman of the respective Committee to attend on his behalf, shall attend the General Meeting. This is to provide clarity of the text. Earlier also it was well understood that the respective chairman of committee can only authorize respective committee member to attend meeting on his behalf.
22.

23.

5.1 In case of a private company, appointment of the Chairman shall be in accordance with this para, unless otherwise provided in the Articles. This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to appointment of Chairman i.e. section 104 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
24. 5.3 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 Dis-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. 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. Just the term has been changed.
25. 6.1 However, a Proxy shall be a Member in case of companies with charitable objects etc. and not for profit registered under the specified provisions of the Act. Deleted Refer comment in sr no. 14
26. 6.1 In case of a private company, the Proxy shall be appointed in accordance with this para, unless otherwise provided in the Articles. This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to proxy i.e. section 105 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
27. 6.2.1 An instrument appointing a Proxy shall be either in the Form specified in the Articles or in the Form set out in the Act. 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.

This change has been made to make it in line with section 105(7) of the Act 2013.
28. 6.6 Deposit of Proxies Deposit of Proxies and Authorizations ‘Authorizations’ word has been added to the title of para 6.6 since the para also deals with authorization of proxy.
29. 6.6.1 In case of a private company, the Proxy shall be deposited with the company in accordance with this para, unless otherwise provided in the Articles. This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to proxy i.e. section 105 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
30. 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

(ii) the authorization 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/ authorization shall be submitted to the scrutiniser along with physical ballot form. If the representative attends the Meeting in person to vote thereat, the letter of appointment / authorization, as the case may be, shall be submitted before the commencement of Meeting.

In case of e-voting it is not possible for the companies to know the identity of the person actually voting on the resolution as anyone can login with the ID and Password. Hence, this insertion has not much role to play.

 

 

 

In case a resolution is being proposed to pass through postal ballot, the shareholder shall send the letter of appointment/ authorization to the scrutiniser along with physical ballot form.

 

In case of meeting, the authorized representative (Refer Sec 113 of the Act 2013) shall submit the letter of appointment / authorization before the commencement of Meeting.

31. 6.7.3 A Proxy need not be informed of the revocation of the Proxy issued by the Member. Deleted This deletion has been made keeping in mind the provisions of Act 2013 as such provision is not there is the Act 2013.

 

32. 6.8.2 In case of a private company, inspection of Proxies shall be as stated above, unless otherwise provided in the Articles. This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to proxy i.e. section 105 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
33. 7.1 Proposing a Resolution

Every Resolution shall be proposed by a Member and seconded by another Member.

 

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 poll has been demanded, shall be proposed by a Member and seconded by another Member.

Proposing and seconding of resolution is not required in case the resolution is put for e-voting or demanded by poll.
34. 7.2.1 Nidhis are not required to provide e-voting facility to their Members.

 

This is in line with the provisions of Rule 20 of the Companies (Management and Administration) Rules, 2014  which was substituted by the Companies (Management and Administration) Amendment Rules, 2016 .
35. 7.3 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. This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to voting by show of hands i.e. section 107 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
36. 7.4 In case of a private company, the poll shall be conducted in accordance with this para, unless otherwise provided in the Articles.

 

This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to proxy i.e. section 105 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
37. 7.5.1 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.

In case of a Nidhi, no Member shall exercise Voting Rights on poll in excess of five percent of total Voting Rights of equity shareholders.

This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to voting rights i.e. section 106 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
38. 7.5.2 In case of a private company, a member who is a related party is entitled to vote on such Resolution.

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).

This is in line with MCA exemption notification dated 5th June 2015 wherein it was stated that second proviso to sub-section (1) of section 188 which deals with voting on resolution by related party shall not apply to private companies.

The second para is inserted pursuant MCA exemption notification dated 5th June 2015 wherein similar exemption is provided to Government companies.

39. 7.6 Where the Chairman has entrusted the conduct of proceedings in respect of an item in which he is interested to any Dis-Interested Director or to a Member, a person who so takes the Chair shall have a second or casting vote. 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 shall have a second or casting vote. Just the term has been changes.
40. 8.4 (d) 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 scrutiniser(s) is required to submit his report within a period of three days from the date of the meeting.

The Chairman or any other director so authorized shall countersign the scrutiniser’s report so received.

Deleted The earlier text of SS 2 put a provision that the Chairman or any other director shall be authorized by the Board only to receive the report on e-voting. Now changes have been made and the Chairman of the Company himself is authorized to receive such report or a person authorized by him can receive the same. The person may or may not be the Director of the Company.

This is in line with Rule 20 of the Companies (Management and Administration) Rules, 2014.

41. 8.5.1 Advertisement shall also be placed on the website of the company, in case of companies having a website and of the Agency. Advertisement shall simultaneously be placed on the website of the company till the conclusion of Meeting, in case of companies having a website and of the Agency. Refer sr no. 7
42. 8.6.1 Based on the scrutiniser’s report received on Remote e-voting and voting at the Meeting, the Chairman or any other Director so authorised shall countersign the scrutiniser’s report 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) shall submit his report within three days from the date of the Meeting to the Chairman or a person authorized by him, who shall 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. This change is in line with changes made in para 8.4. Refer Sr no. 40
43. 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 shall be displayed 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 along with the scrutiniser’s report shall 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. 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 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 along with the scrutiniser’s report shall 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. Earlier it was not clear that for how long the result of voting and other details thereto should be kept by the companies on the Notice Board. Now it has been made clear that the same is required to be displayed for at least 3 days.
44. 9.2 In case of a private company, the demand and conduct of poll shall be as stated above, unless otherwise provided in the Articles. This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to proxy i.e. section 105 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
45. 9.4 At least one of the scrutinisers shall be a Member who is present at the Meeting, provided such a Member is available and willing to be appointed. In case of a private company, the appointment of scrutiniser(s) shall be in accordance with this para, unless otherwise provided in the Articles. This was a very weird provision. There is no such provision in the Act 2013.

Para inserted for private companies is in line with MCA exemption notification dated 5th June 2015.

46. 9.5.1 Based on the scrutiniser’s report, the Chairman shall declare the result of the poll 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. The scrutiniser(s) shall submit his report within seven days from the last date of the poll to the Chairman who shall countersign the same and declare the result of the poll 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. Timeline of submission of report on poll has been prescribed.
47. 9.5.1 In case Chairman is not available, for such purpose, the report by the scrutiniser shall be submitted to any Director who is authorised by the Board to receive such report, who shall countersign the scrutiniser’s report on behalf of the Chairman. In case Chairman is not available, for such purpose, the report by the scrutinizer shall be submitted to a person authorized by the Chairman to receive such report, who shall countersign the scrutiniser’s report on behalf of the Chairman. Refer sr no. 40

 

 

 

48. 9.5.1 In case of a private company, the declaration of result of poll shall be in accordance with this para, unless otherwise provided in the Articles. This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to proxy i.e. section 105 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
49. 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 shall be displayed 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 companies having a website, shall also be placed on the website. 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 shall 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 companies having a website, shall also be placed on the website. Earlier it was not clear that for how long the result of poll and other details thereto should be kept by the companies on the Notice Board. Now it has been made clear that the same is required to be displayed for at least 3 days.
50. 10 Resolutions for items of business which are likely to affect the market price of the securities of the company shall not be withdrawn. However, any resolution proposed for consideration through e-voting shall not be withdrawn. Resolutions for items of business which are likely to affect the market price of the securities of the company shall not be withdrawn. Further, any resolution proposed for consideration through e-voting shall not be withdrawn. Cosmetic change.
51. 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, shall be read at the Annual General Meeting and attention of Members present shall be drawn to the explanations / comments given by the Board of Directors in their report. 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, shall be read at the Annual General Meeting and attention of Members present shall be drawn to the explanations / comments given by the Board of Directors in their report. The question that arises here is how a company would determine that whether the qualifications, observations or comments or other remarks are having material adverse effect on the functioning of the company or not. There is no such quantum prescribed. Again, this insertion goes in vague
52. 15.3 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 itself, giving in the details of day, date, time, venue and business to be transacted at the adjourned Meeting, the company may also opt to give Notice of such adjourned Meeting either individually or by publishing an advertisement, as stated above. This reflect the same position as provided in proviso to section 103 (2) of the Act 2013.
53. 15.4 If a Meeting, other than a requisitioned Meeting, stands adjourned for want of Quorum, the adjourned Meeting shall be held on the same day, in the next week at the same time and place or on such other day, not being a National Holiday, or at such other time and place as may be determined by the Board. If a Meeting, other than an Annual General Meeting and a requisitioned Meeting, stands adjourned for want of Quorum, the adjourned Meeting shall 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. Except AGM and a requisitioned meeting, the only meeting that remains is the Extra Ordinary General Meeting. The adjourned EGM can now be held on National Holiday as well.
54. 15.4 An adjourned Annual General Meeting, adjourned for want of quorum or otherwise, shall not be held on a National Holiday, only if any item relating to filling up of vacancy of a director retiring by rotation is included in the agenda of such adjourned Meeting.

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.

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.

AGM adjourned for want of quorum may be held on National Holiday except the fact that any item relating to filling up of vacancy of a director retiring by rotation is not there in the agenda of such adjourned Meeting.

There is nothing new in this addition.

 

 

 

 

 

This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to proxy i.e. section 105 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.

 

55. 15.5   In case of a private company, the requisitioned meeting shall stand cancelled in accordance with this para, unless otherwise provided in the Articles.

 

This is in line with exemption notification dated 5th June 2015 wherein it was stated that section pertaining to proxy i.e. section 105 shall apply unless otherwise specified in respective sections or the articles of the company provide otherwise.
56. 16.2 Nidhis are not required to provide e-voting facility to their Members. Exemption given to Nidhi company,
57. 16.3 (f) decide the record date for reckoning Voting Rights and ascertaining those Members to whom the Notice and postal ballot forms shall be sent.

Only Members as of the record date shall be entitled to vote on the proposed Resolution by postal ballot.

(f) decide the cut-off date for reckoning Voting Rights and ascertaining those Members to whom the Notice and postal ballot forms shall be sent.

Only Members as on the cut-off date shall be entitled to vote on the proposed Resolution by postal ballot.

Term ‘record date’ has been replaced with ‘cut-off’ date.
58. 16.3 (g) decide on the calendar of events.

(h) authorise the Chairman or in his absence, any other Director to receive the scrutiniser’s register, report on postal ballot and other related papers with requisite details.

The scrutiniser is required to submit his report within seven days from the last date of receipt of postal ballot forms.

Deleted Point (g) has been deleted. However, other deleted portions are duly captured under revised text of para 16.6.1.
59. 16.4.2 In case of companies having a website, Notice of the postal ballot shall also be placed on the website.

 

In case of companies having a website, Notice of the postal ballot shall simultaneously be placed on the website.

 

Not a major change.
60. 16.6.1 Based on the scrutiniser’s report, the Chairman or any other Director authorized by him shall declare the result of the postal ballot 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 scrutiniser shall submit his report within seven days from the last date of receipt of postal ballot forms to the Chairman or a person authorized by him, who shall countersign the same and declare the result of the postal ballot 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 earlier text of SS 2 put a provision that the Chairman or any other director authorised by him shall declare the result of the postal ballot. Now changes have been made and the Chairman of the Company himself is authorized to receive such report or a person authorized by him can receive the same. The person may or may not be the Director of the Company.

This is in line with Rule 20 of the Companies (Management and Administration) Rules, 2014.

61. 16.6.1 The scrutiniser shall submit his report to the Chairman who shall countersign the same. In case Chairman is not available, for such purpose, the report by the scrutiniser shall be submitted to any other Director who is authorised by the Board to receive such report, who shall countersign the scrutiniser’s report on behalf of the Chairman. Deleted Changes has duly been captured above.
62. 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 shall be displayed 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. 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 shall 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. Earlier it was not clear that for how long the voting results of postal ballot and other details thereto should be kept by the companies on the Notice Board. Now it has been made clear that the same is required to be displayed for at least 3 days
63. 17.1.6 Minutes of Meetings, if maintained in loose-leaf form, shall be bound periodically depending on the volume. Minutes of Meetings, if maintained in loose-leaf form, shall be bound periodically at least once in every three years. Time has been prescribed.
64. 17.1.7 Minutes Books shall be kept at the Registered Office of the company or at such other place, as may be approved by the Board. Minutes Books shall be kept at the Registered Office of the company. Pursuant to Rule 25 (d) of the Companies (Management and Administration) Rules, 2014 the minutes may also be kept at such other places as approved by the Board.

This change is not relevant. This contradicts with the provision of Act 2013.

65. 17.2.1.1 Minutes of Annual General Meeting shall also state the serial number of the Meeting.

 

This will not impact much as the Companies were usually following this practice earlier as well.
66. 17.2.2.1 Minutes shall, inter alia, contain:

(j) Reading of qualifications, observations or comments or other remarks, as mentioned in the report of the Secretarial Auditor.

 

Minutes shall, inter alia, contain:

(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.

 

The question that arises here is how a company would determine that whether the qualifications, observations or comments or other remarks are having material adverse effect on the functioning of the company or not. There is no such quantum prescribed. Again, this insertion goes in vague.
67. 19 Report on Annual General Meeting

It shall be signed and dated by the Chairman of the Meeting or in case of his inability to sign, by any two Directors of the company, one of whom

shall be the Managing Director, if there is one and Company Secretary.

Deleted This deletion is irrelevant as the same provision is there under section 121 of the Act 2013 read with Rule 31 of the Companies (Management and Administration) Rules, 2014. Hence, the Companies are still required to comply with the same.

(Author is Manager at Vinod Kothari & Co. and can be reached at  jyoti@vinodkothari.com)

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