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Company Law TTT ECS tater f Executive. © cA PET! Peo INDEX soet ContENTS Pace No. L | AGM Provisions uxith @uestious and Answers “TT 4-3 2 [Adjournment of Meehings 3 3 | Nohce of Adjourned Mecthug 4 4. |Guorum. Provisiows LSection-174] 5-6 5. | Proxy Provisiows [ Secton-176] 76 6 | Demand. for Pol [ Sectious-1797 3 % [Chairman's Fower and casting, vote. Lo 8 | Nomination of Shares [Sechon—1094] 11-12 9. | Points on transfer of shares 13 to. | Registerahion. oF Charyes 14-16 i. | Certification of Transfer [ Section-112] 17-18 1g. | Company Divided 19 13. [Distincton between Fixed Floatingcharge | 20 Ju. | Investment held im Company’ name[Sec-ya] | 2b is. [Compulsory Resol “fer Postal Boltct [sec-1924] | 22 Prepared bys — ANKUR GARG (Company Seckerary] $eet66 * Annual GENERAL MEETING” Rules ov the principles of extensions for holding AGM. 4) The extension. cam be granted ow.y- by ROC. wok by DCA oy CLB. 2) Extension will be. granted ouby for special veasous® 3) The application for the extension shalt be filed votthdun or befere the expiry of wore stringext time Jimit. UJ Extension is qrauted oul. for Original AGM. avd not for the adjourned meeting. Cd Seizure of Account book by Pabice ==> Yes r~ W) New compliance. of statulory Audit Report —> No x UD Now preperation. of accounts=> No x iv) Natwial colanarhy. =p ** Glai Now- preperation of Awouubs DEA ClaviPteahon:- DEA has clarified that Atm shalt be. convened and all the business shall be transacted as per the Agenda tthe AGM exceptthe adoption. of Accounts , Then the AGM Shalt be [adjourned Jand the adoption. of accounts shall be done abthe adjoumwed AGM . Bub such adjourned Agitt shall also be convened within the mor. stringent time Limit vorims otherwise. Frue u/s 210. More strivgent-time Limits: See 166 vead with Sec- Io, Guestion- Answer ow Seclée CAGM) Guar Can two Aeim's be convened ona single day ? Asch Yes, Reason being tus is wok prchibit anywhere fn. Companies Act, 1956 The Ram of last year canbe convened on. the same day, when the AGM of current year is proposed tobe convened. US Single notice ts sufficient of the above 2 AGIMs Gusi2._|s it wecessary to hold AGM if the Company ceased 4o continue its business ? Aus: Yes. As itis stodudory requirement U/s 166 210 HUthe. winding up of the company. Coser Madan Gopal day Ys: Slate of west Bengal. Guar3 iF the noticeoF AGM issutd by te C5. or MD. withouk tha eutthority of Board , whether the AGM is valid or invalid? Aarsd, IF tae board of directors ratify He notice be fove the, AGM is held then the AGM. hal be vatid otherwise uot. journed , : Gus Canwe convened Rice on oa public hoLiclay ? Aus Yes, Cif adjourres! for wont oF quorum, then very much possible. Br A E No quorum. preseut® Adjourned to tae ext we. u/s 174 (4) iste bE [> Q@uiteeseble. became. Adjourned AGM be maybe held ona public Lrabiolany ‘ Adjoumed AaMona Public hadidasy Coutinues..... © Original. AGM ow Mowday- G busi ness trav sacked 2 Remaivs Volunary Adjournemeut to coming, Sundar e eo Law is sileut @ Poiuk is ye tobe tested fu Laws @ No DcA Clauifieahon. yn Since Law is sibenk st seems thak such Adj AGM cam. be convened ov a public holder. However 05 a geod. corporate. Grovernance. practice and qoiug by thn essence. of Sechon-166(2), its houtd vobbe convened. ComensioN i- forfransach ug te balance. bs. See imac v . i , bli fdjournmeuk to a puolic Adjournment toa public voiday is possi ble. holiday is nor possible. bi wy © Stahutory Gren Meehug- @ Adjourned S.G-™- @& Annual General Meehug- x @ Adjowrned Aaa. Gas ee © Exbracnclivary Gren -Mechwg, awe" von) Vo Comparatve Table for Annual General Mee we — — Le oO iP © Adjoumed 6.6.41. Notice of Adjourned Meehvg ® Adjoumed by the cm.| | Adjourned for want Adyournement for withtheconsento® | | oF quorum. Log time pared members i \ v Z ‘ The date, hmes N wchaale journed tol |Ady.asper 5 Place of way Pest va is reek chon Regu 53¢4) isdecided ak th sametime, Ifo the | of Table-A i fcided é same place || BO-D. fimeof adj t T ' | 2! doys J : ' Notice veqd v w > © Fresh Nohice. * No Fresh Pro fresh “Hesh iy veqd Yd Hee 15 vequi : Nob Nehee for original, notice | required "FresNoteo. Nene Real Mehug visit CO 1s required OD oS & Sect74(a) Adjourned for Caedays Adjourned for > Bedays Frosh Notice is required Fresh Metres. regal (May be vews paper adv.) aspen SOeL7L ca Says Head...) Regulation. $303) oF Table A &- when.a mechww 's adjourned for 40 days or more ,Nohce of Adjeurned Muctivg shall be given. as fu. cose of original mectiug. a A nucur Gi RG [conranySecrerany] Seqt14 G@uerum for General Meehvg- © Rules for quorum. Owly the members personally present are counted forthe purpose of quorum. (Except Sec 167, eg} ent man quovunt 2) Owly Equity shareholder counbfor quorum. . =P DEA has claxciFied thak i General tae equity shares holders are counted na quorum, bul tae preF. shew hold ers may be counted im the quorum , if there is any business in the Agenda affecting the Preference sharehslders 3) The number of members way got veduced below 5 but subsequently shall wot get reduced below 2. uy Joluk sharelolders are counted as one. for quorum. 5} [Secon tb7] => The vepresenlahve of body corporate appoiuted Hhrough the board resoultion. is counted as member personally present Gy Sec te7A | The yepresentahive. of thw president or the quer ner OFe counted as member persovally preseub |. tHe. General Meeting for the puxpase of quorum. @usir Caw Hre represen takives meutioned above, appombaproxy fo vote ou Helv behalf Posy Yes, As per section —1e7Ma), ibis possible . By iwterpreiva- Sechion—\eqfa) we may soy tal for the. purpose of appolubmeut of proxy, such representatives of Geverner or Presideuk shall be considered ad member of Co Fika person is presenl- in the seeting,,a4 a member himself and also oS @ Yepreseutahve of tue body corporates ¥/5 187, then he willbe counted as 3 member personally present. Section-174 Gucrum, aud © Secteu-Lt6 Prony Situation. cL Situation ':2 My: A (Menber) + Mr B (Member) Mr. A (Member) 7) | 7 As representative, As vepreseutahve. of xd. Yuk 2 Ue Pd Gi RIM Sid Quai: Whether quorum. is prestul ? @usy Whether quewm. 's preseub Aus Yes, for batt Public + Aus Privale Co. quorum. ts preseul- Situahon Iw a pub tw an alr crash + there shares were transmitted to 3 sev vivive, members Qus > whakwiat be the position. of quorum. in Hels Company? Ase \Palt 3 members personally pereseuk tun sufficient quorum | a Ove Man. Brora _ lic company having. 7 members, 4 members died © Seet67 = AGrMt by CLB.Co@) @ SectB6 — LGM by C18. (tribunal) © Sec 6 — Clan Meehugs Cuheve ont person covatiture the entive class) Seel¥6 Proxy @ = Any ome jot shareholder can siqu the proxy form and it Ts vot required that the proxy form should be signed by the all. joiuk holders =P According to Rammiya.” ln case of joiuk members all must si the proxy fornt, onless Articles enables one joimt holder to sig. [appoint > my. Px (Px . “aly Gaoworal eek Mr. Po (Prox (Geveaittestngy valid vole) Srluation:L. Mrx Sry 500 Shaves off wi Tabie'#' adopted then auswer is Mr. CPs vote is vabid) Requlahon-S7 of Table" A” i" \w cose of joinb holders , the vole of eenior toho tenders a. vote.,whether im person. or proxy, shall be. accepted to the exclusion of the votes of other joint holelers.” H for tlds purpose. senior shaitbe defermined by the. ower in. which the names stand iu the register oF members. Revocation. OF Prox Audomalic. Revocation | Vv (© sFthe member himself reaches Such letter shalt, reach the chairman. the Gen Mubng + particopale i” before prexy_paxhicipale in tte pall. ‘ue. poll before the proxy - KodierVole of Proxy Valid ® \f another valid proxy form. Example :- Suppose. leHtex receive befbve tem. is submitted to the. company. No. @,9,lo amd Proxy haa given. Wis @ Death or insanity of Hao. votes for tem 4 toF thn the vote member. bop ky el bh he wma ob ¥ By Sending Hee evocahow er toto. Situation -t (3) o) ir @® @® Lip Ho} - Seosvavs [lesept] [225ept — ; Sco.shares 5b0Share. = See [27 SepE-] X veh proxy Yoiuts Valu (D) Proxy appointed fororiginal Meehug. is also valid for Genera Meetivay which is adjowwed ) 2) Tae proxy canbe avppomled fox an adjourned meehiug- though himself attended the oviginal General Mahivg-, Situation 12 Mrs. ) 48 Hours Gat 500 Shores nal Signed <3 lug) a dispaiched ove dispatchadow 4 IF \6 f Fy Se0svam®) {tor Soo sh] R fincturgiuation > WP 20Moy Fr 2uMar saconpny Reaches a ny OU => Reaching Dateis nveevant tp "20g ae oh the extent coleulahivg 48 hous, Signalwe dabe. 's velevernt- a FR, veaches ov 24 August tho Pt weuld be valid Prony. Q Section-179 Demand for Poll “Who can, demand fol!” iw case of Co.cs) having Share Capi {uw Case Cots) not havi . a Ha Share. Capital “T Public Go. PrivaleCo. R Giiny member ov Members | Ot tia members pers fulie Gon + Privale Co. present in person ov proxy | Present fn the GM < 7 Any member preseut holding atleast 4/19 volivg Thun any member present iy ) lm personoy by proxy Power with respect fo tha Person. or by proxy cam. Mrotdliveg. tie er more. tesclabion. ey demand palt (see éuamples®) votivg Power wb Hee FH members person i dome @ Any member present i ™ \} present are ST than me reelahon wasydomaud Person. ov by proxy Voda wembers present in Person . a paidup Copi. of % Seop0 A, by Proxy eee Example: ® InGreneval Meeting ~ Perso. Presenb= 10 ® entre sede Lo Person Present = Lo LOutof then}: Proxies } | of tum holda Tout of them] = 4 Proxies _ of them] = 4 Proxies 2 Members /2 Proxiés Proxyolso (Ci Member /1 ProxyCandumavd) i Member +1 Proxy Fa members) ndamand Poll Such (a mercber+ 1 Brox?) ey Laden Pell Poll Quart Con Chairman. of Generel. Meehvg. TT Ted dag fer 0. poll shralght away withoub ovdeving the show of hands. Avaid (io) he can. not do. $0. Gugr_Canthe chairman order for Poll straight away witheul first ee orderme, Hae show of hands, iFelewand. tor Poll received js £79. Aus? (Yo), LH demandud 4 folling results are chalkengable. but show of hands cannot be challenged if eutered fu tha Minuke book. wy Kup Hu polling papers safe HU they checked or Imspecled. ok As soon as the pall is demanded the result of shour of hands is nuitied. Adjournment fower. of Chairman. CHAIRMANSs Powe Rs ,~ Adjourn the Gem worth the, Adjourned the ev. if 60 consent of Members abrected by te Mumbers. Notes lncaseof violanee inthe Mabiug-=>The chairman as Hae imherant power to adjourned /oy fo ovderthe adjoumnesment. CastIn@ Vote for example In Board Meehug ==? Y-t (Votes equally s phit) Vole. of Ghanman, | (incase cf equality of votes) Coshivg semone@yotgiittinn > Sectonte-(SRICasting le vot (I. General Meek (a Bowrd Meeting No Need Appointed by way of He can also give casti Reguiation 76(4) vote_ iF romuivedl “Y ad (AF veed is tho) He con qe casting vere Reguiahovi-76 (2) + The bend elect a Charmwanof its meehivg and deterrive the peried for which he Istohold offtce. Sec- 109 A Nomination. of Shares © Guestons where the nomination is made by. the joint Shareholders bub ove of them passed ausax Whether the survivivg share holders has the viaht to camcel the nommahion and make a neusnominahon . e@ Avswer: Yes . a) . sitvation toe Sold Iie shane ® off Nomination becomes invalid (torimate oustomatically / jnamedia toby 8) dituahion-@) Gry Take 4 toa; @ Pledges lus shaves wfavewe of Bank. . Nevo 2 (UD On the expiry of 6 months, x clefaulted sr in repayment of Loan and Bank, "(Mr Z] forPeited tha shares. of Nammation becomes invaticl automate alle, LY Simply Pledyavg te Shares” Norinahovt Situation-@)_ ve AP 2 reg © Nomination, we 8 B _— GD Died oy shaves will be. given to the Ligat lretrof Mv. B. Situation@) [MeK}- Died @ Nomination, Mr : (ori fess) Died ty Since iu Has Situation. Nominee Mr. L died before. Mik , Neminationstands cancelled and shares usilt be. given to dhegal heirs of M¥-K Gus (Fboth Mr or MrL died ox the same day who will be entitld fo the shares, Aws:- Shares usitl be qivento Legal heirs of My. K. Cortoin. important poiuls w-r-te Transfer of shar. 4) A pub.ic company yefuse. to transfer the shares im favour of a person [who is company’s ow. employee] onthe suapecion that when such person. attended the Gr. he will cemse, nulence. 2) Director of a Company yefuse to vegister thetransferen the ground thal proposed transferee. has macle altempts iM. the past to windup the Company. 3) Directors of a company cannot] refuse to register the transfer ofshares in favowr of proposed transferee onthe ground that he is a busivess vival. 4) Directors of a company cannok] refuse to register the transfor of Shares without communicating. the grounds of refusal, Frousfer of Shores @) Some. important poiuts :- ~ LY Rejected Transfer deed returned to the transferee 2 The CLB has pointed out that the Co.on not registering the transfer Should have returned the documents to the party who lodged them. (the transferee) avd vot the transferor as the transferor losses his right In the shares as soonas he executes the transfer in blank. 2) Priority amova. transferees !- Where a shareholder has Frauclulenbly. Sold ts shares to two oliffereut transferees, the frst purchaser will, on the ground. of time alone, be entitled to the shares in priovity to the setond. EX A person — assigned property. «. shares — to creditors . Creditor Failed to register shares in lu's name—butgive nobice ofaseignmew. to Co. Lateron Assignor(A Perso) sold them— to someone ese. Held — Assignee’s claim— prior im time— So he is entitled to shaves. 3) Pledging of Shares -— Shares of a company-can be a subject mabter of a valid. pledge As per Sec atx) of Sole of Goods Ach 1930,Hre definition of Geods includes stocks and shaves. So in tus WO nanan 4) Troms position. of name t-- 'w case of joint shave holders one or more of them may require the. Go. to alter or rearrange the serial owler of their names im the. register of member of Co. \n Hus process there wiltbe. need for effecting consequential changes, in the share certificate. issued to them. The reques of transposition may be duly cousidered 4 approved by The board - Since vo tanster oFany interest in the sharestaken. place the question. of insishua on Filluy tran-desd wot arise - => There. is no need of execution of tran clead for the transposition. of name. iF the vequest fo change inthe ovder of ynames wos made fv write. Transfer of Shares Continues... ® Quart Transferor or transferee execule the share +rau-deed and deposited the same. with the company along with the shave. certificate ——The transfer is pending —— meanwhile. the. company amended the articles fo insert a newsground of vefusal. Now can. The company vefuse. the above transfex of shaves on this neur ground. Aus Camendment will havethe prospective effect) Qawsi2 where the sharetransfer committee is deleqaled the power to register the transfer of share, then whether such committee has the inherant power to refuse the transfer? Arua: 2. (Ne) No imherant power available. to committer above. REGISTERATION Of CHARGES a Consequences of non-—registeration of charge $— (B> Charqye becomes void. agaiokst against Liquidator # other credi lors. E> Charge rermaius valid against the Company till the Company is a& going concem., 1-2. (it remains enforceable against the Gs.) Loan for 6 Yeaxs Company is a. going. sodets 304074 Ato Registeration (O) Concern. As perSec ns & Years @ Stamp Act complied --—~ (ii) Registerahion Act Complied (ii) Companies Ad Complied Ow the expiry of @ Years Co. de faubted iu repayment f Loan Charge. vemains valid ¢ ouforéeable agaimt tule S 2 Crove loan Lean. for & Years Loan for 7 Years TPBT (SBT. (icici : No Regn. J Godms & (ecng) © delle || — repay ett of ‘S@T Loam, + po 20p0 Gea) (2808) a0} — [4 (3 Yeows)___ Sat got rectification ‘Che Sos ore tee nwt aL Prom iwi vetobect Ha Rolo Stamp Ack. Stompcke~ Jak oF tect Rep Ack Regu AcEL- (See tuted) Gw@Ack&) GG) Ade a Charge. of Icict gels the. Priovily- over the charge. crated wv favour of SBL Conctusion :- Even though the $82 has oblained the recthicahon. of charge Register from CLB im rooy , sill the charye. In. favour of BI with remain. void agaist IcICL bub it shalt hold geod agaiust tDer CSect4 £@)). “ae ate) => The chargé is voidagainst Lawiclator avd. therefore. the. Liquidator with treak the TDBI as unsecured creditors So (15-U=1999) (25-U-1949) (05-05-1993) > Chargeok } {Charge of “AY "B'veqd-at vega: at ROC ROC: office. Change creaked on the Same. property iwfaveur’ of B Charge cveaked by the Co. in favour. of A QS Doys ) Qusi- Who witl getthe provity 2 ‘Aus There are 2 different views regarding priority, iw such sitwalion 1) Blvst Vieu-(D)=>" p)” should be. given. priority once forall. 2 Second View QD=> "pg" shalt be. given the priority. over"A" durivy 25-4-99 to 04-05-99. Buk “A” shalt be given the prioty from. S-5-99 onwards lore appropriale. View is Second viewras It carvdes te intention of Lavy. Sec 112. Couification. of Transfer GF) Section scheme aba Glance Situahten = TransFer. Transmission Me. Ae B signi the Shave transthy Sec 108 Sec- 409 deed for sole of 300 See Lo Sec- 109A Shaves oubof Soo Sec 142, Sec- 1098 Shaves of Mr.A - thereafter [Sect PEG |Gommou Sets 114 A-PabCa,|Sectiows dlivers Shave. Cor tPicake.(Sobshaves) + Shove tray: deed (3e0 shares) \—» Retains shar Certificahe (np woo [Shavetrcn dead with the word “CERTIFICATE LODGED” | My. A wo. alance Ticket G00 sharus) oe Shometra as 8 ad v vecewed Sroa'Co, ora [Pr BI CoctiPicale Lodged (et this poiubof time MrB is sakisfed uy Faly intention of My. 4 totam. W's shoo be. and 6 pays Pur Cousi.to A.} ayatty es ; " Neha contficale. Mga will be iscued by te Co wee ele ee a “te A+B after enswurg tre feceipt of Balance ticket from A and shautran deed from B Sects? Cedificabion. of Tanstvx , @® Situation 2, thereafter . i> Share. Certificale (Soo shares) ts shave Tran ceed (200 shares) Tr Shave Tra. deed (300 shaves) [Reto woing Shave. certificate | iD Stare tran: deed (200 shares) (withthe words certificate Lodyed) 2 Share tyansfer deed to BEC Goosh) sh-tawdud Sh traw: deed (200 glare) ck % a 2 we Gee | ComPANy 7? RE + Onreceivivg respective sh-tan ceed from BC the company wil issue neu shor certificabs to +c. Distinction between luterim + frual Dividend lulerime Dividend © Declared by Board of Directors aud also recommended by them, @ Declared on the basis of Performa. fe L. aie. (After providing Dep far-fulk yeas) @Ouce declared, it cau be revoked thereafter. @ tt cannot be cousideredas a debt due. from. Co. to its shareholders. ©oweedeclared it is vot required fo be posted to shareholders within 30 days of declaration Important Notesg- (ig) Fival Dividend &© Recommended by Board of Dix, and declared by QSHs in AGM. @® Declared onthe basis of Fival Pel aie.as audited . @ Ouce declared im the AGM it convot be revoked thereafter i) It Is considered asa debb dus from the company to its shareholder . | ® Once dectared, tt shall be. posted to shauwbolders wilt 30 days of declaxahon. PF Dev has danifed thak the intiriw dividend can be revoked by the Company or by Bowed of Directors within Sdays before the amount of Dividencl ve amount of interim. dividend is deposited ima separate bank accouut u/s 205 (18). & lost 3 distinction. belween iukenm+ final div. are no longer maintainable after commencement of Co. Amend ment) Act,2000 which Inserts Sec 205 (A), (18) + (ic) regardiva, Water dv. =9 These. Sections put interim dividend ak par usith final dividend 12. veux interi dividend, isadebt cannot be revoked) What is charye. or Mortgage , &) = (On Immovabie. | Ou Movable Froperty Pro J [Morigage | IF Posse ssiow. of Properly is aiven awa 1 NM Pledge Hy pothecation. Diskuction bebween. Fixed and Floakug Charge, 4) Fixed Chorge is createdouthe. | 4) Floating charge. is creabedon specific property the class of property. IF Possessiow. er Fropery 's wok Bin cose of hkxed charge property 23m case of Floating charge is existing & deberminable property max be §- a Exishng or determinable ond Gi) Future andl inderminable 3) Fixed Charge fs identifiable. 3) Floating charge. ts wok wert, property-- identifiable wrt. the property. 4) Ped charge clutches the | 4) Floahugcharge. Floats over property. the property. Secug * Investment futhe name of Co. @) Sec 49(L) & Investments should be held by the company in its ows name, Sec-49(2), (3), CW) ++ Creat exce plows +e. A Company can held its investments iv other person's name. Excepton it — See 49 (2)=s Qualification shares *S ciel appoints Mr as nominee. } director im XYZ Lte} e The Articles of XYZ. Led. provides for quali shares. Give & Crove. Loan for to Yrs. toxyz Ud Interpretation t- Section- 4402) says ICICI can purchase Hu shares iv. the nameof ifs nominee divector. Because heve ICiC] is depubivy My.Z in x¥z Lid: a nominee divectoy, = See 49(3) Jo wanted: ~ L+6= 7 members Coshidhis Sahaboy miu. IMcase. Wholly owned Subsidiary Co. of Pub Co.) Interpretation: Heve iF H Lid: pays on behalf of #,8,¢.D,E,F the | volut of theve"L Shaye Hun it is Five. Astle same payment is fomainluin min 7 members in correo Pub. Co. 2 See. 4904) Investment Company can make the investmeyt- jn ta name. of other Companies / Persous. Companies (Passing. oF Resolution. by Postal Ballot) Rules 2001 The. Business which have been specifreal by Ceutval Greve. to be conducted ouly through Postal Ballet ave follouny-¢ ~ LY Alteration im the objeck clauweof Memorandum . 2) Alteraton of Articles im relation to inserhouw of Provisions definivg- private Company. 3) Buy. back of own. share by the company under Sec. 77H (1), 4) \ssue of shares with differential voting. rights asta voting, or dividend or otherwise. under Sec-86(a) (iD. 5) Change iu the place of Regal: office ouside Local Limits of any city, town. or villaye as specified im. Sec-Lu6 (2) , Sale. of whole or substanbolly. the whole of undertakivg- GFa company as specified fm Section-243(t)(a), ¥ Givivy loans or extencing quarantee or providiva security In excess of the Limits prescribed in Set- 3724 (4) . 8) Clechow of a divector under proviso to Sec~252(1) of the Companies Ack 1956. (Smal Sharchldir's dive cen) 3) voriation In the viguts altached to a class of shares or debentures or other Secwuhes as specihed fn secton- 106. _ AncvR GARG Q@.¢-5,)

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