Aarti (CA FINAL) (48 Points)
19 June 2010but before AGM member Register is kept close for the period of 30 days then how we come to know that our shareholding is grown to 25% on the date of AGM...
ARUN KUMAR V
(CA)
(209 Points)
Replied 19 June 2010
under sec 224A, if not less than 25% of subscribed capital is held by the entities provided in that section appointment shall be made by passing special resolution. even if register is closed sec 224A does not require for beneficial holding, it just says only "held".so even name not entered in register but these entities have right to hold sec 224A attracts.so the date of meeting is relavant for holding.
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 19 June 2010
Hello,
MATERIAL DATE FOR DETERMINATION OF THE 25% OF THE SUBSCRIBED SHARE CAPITAL
The Department has clarified by Circular No. 2 of 1976, dated 5-6-1976 that the material date for determination of the 25% of the subscribed share capital of the company is held by specified institutions, whether singly or in any combination of others will be the date of the annual general meeting at which the special resolution is required to be passed.
Generally, Articles of Association of companies provide for closure of the Register of members before annual general meeting during a period not exceeding thirty days at any one time, it is unlikely that the position regarding shareholding in the company will be different between the date or issue of notice and the date of the annual general meeting.
But kindly appreciate---Closure of 30 days is written in section 154 but practically nobody closes its register for so long bcoz 5-6 days closure is enough.
Further there may be change in shareholding between date of dispatch of AGM notice and date of actual AGM because register of members is closed for a short period.
For example:
1. Date of dispatch is August 01, 2009
2. Date of AGM is August 26, 2009
3. Date of closure of register is August 20, 2009 to August 26, 2009 (Both days inclusive)
Hence in this case (Mostly followed by listed companies) There may be a change in shareholding after August 01, 2009 and before actual closure of register. Here it is pertinent to mention that BOD/RTA of the company can continue of give effect to the transfer request till actual closure of register i.e. August 20, 2009.
Best Regards
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 19 June 2010
Course of Action where a change in the shareholding pattern occurred
In exceptional cases, where a change in the shareholding pattern in the company has taken place, between the date of issue of notice of the annual general meeting and the date of actual passing of the resolution regarding appointment of auditor, the company may either,—
(i) adjourn the meeting to another date, and later issue the required notice in accordance with law and thereafter pass the special resolution required to be passed u/s 224A of the Companies Act, 1956;
or
(ii) omit or pass over the item on the agenda regarding appointment of auditor.
In the event of the company adopting the procedure at (ii) above, the situation would be then covered by section 224A(2) of the Act.
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