Companies Act, 1956

Section - 89 - Termination of disproportionately excessive voting rights in existing companies

Termination of disproportionately excessive voting rights in existing companies.

89.     (1) If at the commencement of this Act any shares, by whatever name called, of any existing company limited by shares carry voting rights in excess of the voting rights attaching under sub-section (1) of to equity shares in respect of which the same amount of capital has been paid-up, the company shall, within a period of one year from the commencement of this Act, reduce the voting rights in respect of the shares first-mentioned so as to bring them into conformity with the voting rights at­tached to such equity shares under sub-section (1) of .

(2) Before the voting rights are brought into such conformity, the holders of the shares in question shall not exercise in respect thereof voting rights in excess of what would have been exercisable by them if the capital paid-up on their shares had been equity share capital, in respect of the following resolutions placed before the company, namely :—

      [(a)  any resolution relating to the appointment or reap­pointment of a director or to any variation in the terms of an agreement between the company and a managing or wholetime director thereof;]

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