BACKGROUND

The provisions of the Companies Act, 2013 (“Act”) allow ordinary and special resolutions to be passed through postal ballot or e-voting route (please refer to Section 108 for e-voting and Section 110 for postal ballot). However, there is no provision under the Act regarding holding of General Meeting through video conferencing (VC) or Other Audio Visual Means (OAVM).

ALL MEETINGS OF THE BOARD THROUGH VC OR OAVM

We all are aware about the current situation on account of nationwide lockdown due to COVID-19. Social Distancing has been playing a crucial role in reducing the spread of COVID-19. The Ministry of Corporate Affairs (“MCA”) had earlier amended the Companies (Meetings of Board and its Powers) Rules enabling all meetings of the Board of directors upto 30th June 2020, to be conducted through VC or OAVM, including meetings on items where the physical presence of directors is otherwise required.

EGMS THROUGH VC OR OAVM

Now, keeping in view the difficulties being faced by the companies in passing ordinary and special resolution on account of the threat posed by COVID-19, the MCA on 08.04.2020 has issued a circular allowing companies to hold Extraordinary General Meetings (EGMs) through VC or OAVM.

Though all companies have been requested to take all decisions of urgent nature requiring the approval of members (other than items of ordinary business or business where any person has a right to be heard) through Postal Ballot / E-voting in accordance with the provisions of the Act, however, in case EGMs are unavoidable, a procedure has to be followed as set out in the Circular (separate procedure has been laid down for companies which are required to provide the facility of e-voting or has opted for such facility and those companies which are not required to provide e-voting facility ).

KEY POINTS

For ease of reference, key points of the said circular are as under:

• Applicable only on those EGMs held on or before June 30, 2020
• The notice for general meetings shall contain the requisite information as prescribed in the Circular
• Convenience of different persons positioned in different zone shall be kept in mind before scheduling the meeting
• Applicable to those companies, who have already issued a notice for meeting subject to prescribed conditions
• Ordinary business and business in which any person has right to be heard cannot be transacted
• Minimum capacity of members has been prescribed to whom such facility shall be provided
• At least one independent director (if any) and Auditor or his authorised representative are compulsorily required to attend meeting(s)
• Attendance of members through VC or OAVM shall be counted for the purpose of reckoning the quorum under Section 103 of the Act.
• Procedure for appointment of Chairperson has been provided
• Manner of voting has also been provided
• Resolutions passed in accordance with this mechanism shall be filed with the concerned RoC within Sixty (60) days of the meeting

(General Circular No. 14 / 2020 dated 08.04.2020)

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Disclaimer

The above information provided by us is for general information purposes only. Although care has been taken in compiling and checking information contained in this document, however, we make no representation or warranty or any kind, express or implied, regarding the accuracy, adequacy, validity, reliability, availability or completeness of any information.