In the wake of COVID-19 the Ministry of Corporate Affairs has pursuant to a circular dated 08th April 2020 allowed conducting of Extra-Ordinary General Meetings through Video Conferencing or other Audio-Visual means earlier not allowed in the companies.
The Companies can use the framework provided in the circular to conduct Extra-Ordinary General meetings on or before 30th June 2020 when the meeting is unavoidable.
The companies which NOT needed to provide the facility of e-voting under the Act:
1. Where EGM is considered to be unavoidable, the Company can hold EGM through VC or OAVM and recorded transcript of such meeting shall be in safe custody.
ASAP the recorded transcript shall be present on company’s website (if any) in the case of a Public Company.
2. The VC or OAVM facility shall allow two-way teleconferencing for ease of members and participants so that they are allowed to pose questions or
The company shall provide time to submit questions in advance on the e-mail address of the company.
The VC or OAVM facility shall allow at least 500 members or members equal to the total number of members of the company to participate on a first come first serve basis.
The large shareholders (holding more than 2% or more shares of the company), directors, KMPs etc. may be allowed to attend the meeting on first come first serve basis.
3. The facility to join the meeting should be available 15 minutes before and after the time scheduled for the meeting.
4. Members attending meetings through VC or OAVM shall be counted for the purpose of quorum.
5. Appointment of Chairman
Unless the Articles issue for appointment of a particular person as a Chairman of a meeting, the person shall be appointed in the hereunder mentioned manner:
(i) in the meeting, less than 50 members are available- Chairman shall be designated in line with Section 104
(ii) in other cases, from e-voting system by poll is conducted.
6. At least one Independent director (if any) and the Auditor (or his authorized representative) shall attend such meetings through VC or OAVM.
7. Appointment of Proxy is not allowed as physical attendance of member is not required in meeting through VC or OAVM, however
Representatives are appointed for participating and voting or for the e-voting through VC or OAVM in the meetings held.
8. The company shall provide a designated e-mail address at the time of sending notice of the meeting where the members can convey their votes when a poll is required to be taken during the meeting.
9. In case of less than 50 members present in the meeting, Voting can be conducted by show of hands unless a poll is demanded.
The meetings can be called later and adjourned to declare the result if votes countingneeds more time.
10. The notice for the general meeting shall make disclosures with regard to the manner in which the framework provided in this circular shall be available for useby the members and contain all necessary disclosures regarding conduct of meetings through VC or OAVM. A helpline number shall also be issued for the facility of members to attend meetings through VC or OAVM.
11.Within 60 days of the meeting all conclusions passed as per this mechanism shall be filed with the Registrar of Companies.
Thus, by extending the facility of organizing meetings through OAVM or VC, the Ministry has relaxed the provisions of organizing Extra General Meetings.
This content is meant for information only and should not be considered as an advice or legal opinion, or otherwise. AKGVG & Associates does not intend to advertise its services through this.
Posted by: CA Neetu Saini