Zee Entertainment Enterprises Ltd. Vs Invesco Developing Markets Fund (Bombay High Court)
Facts-
Two institutional investors issued the requisition notice to Zee Entertainment. A suit is filed by Zee Entertainment against the demand of two institutional investors seeking extraordinary general meeting. Zee Entertainment has filed a suit arguing that the requisition notice send by the institutional investor is illegal and invalid.
Conclusion-
Under Section 100 of Companies Act, a requisition notice sent by shareholders must meet the following requirements:
they have collectively not less than 10 per cent of the total share capital,
clearly sets out the matters for consideration,
the requisition notice is signed by the requisitionists and delivered to the registered office of the company.
As per Section 100(4) of the Act, if the Board of Directors does not proceed to call an EGM within 21 days from the receipt of notice to conduct the same within 45 days, the requisitionists are at liberty to conduct the said meeting within a period of three months, provided that the requisition notice is ‘valid’.
The major bone of contention in the arguments levelled by both parties revolved around the concept of ‘validity’ of a requisition notice sent to the Board and whether the Board of Directors can exercise its discretion to refuse to act upon such a requisition notice.
Injunction is granted in the matter.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
