Validity of egm

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

15 July 2013 One Company received requisition for calling of EGM from members, after that EGM was called, There was 9 shareholders in the Co ( 4 shareholders was against the resolution holding 56.20 % shareholding ) and 5 Members was in favour of resolution holding (43.80 % shareholding), Kindly advice whether the resolution be valid or not, Kindly also provide the section in this reference.

Ajay Mishra

Ajay Mishra (Expert)
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16 July 2013 Hi

Section 189(1) of the Act, provides that most of the matters, which require the approval of the members, may be approved by them by an ordinary resolution. A resolution is deemed to have been passed as an ordinary resolution if it is approved by the members at the general meeting by a majority. In other words, the votes cast in favour of the resolution should be more than the votes cast against, if any.

Ajay Mishra

Ajay Mishra (Expert)
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16 July 2013
Section 189(2) of the Act, provides that certain matters are deemed to have been passed at a general meeting as a special resolution only, if the votes cast in favour are at least three times the number of votes cast against the resolution, if any.
A special resolution passed at a meeting attended only by the shareholders who were in arrears in respect of calls, has no legal effect
The resolution shall be a special resolution if it fulfills the following conditions:—
(a) The intention to move the resolution as 'special resolution' is specified in the notice for the meetings.
(b) The text of the special resolution alongwith explanatory statement shall be given in the notice.
(c) The required notice for convening the meeting has been given as provided under the Act.
(d) The votes cast in favour of the resolution are at least three times the votes cast against, if any.

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