ICAI News: MCA has issued Clarification on the passing of ordinary and special resolutions by companies

ICAI News

MCA has issued Clarification on the passing of ordinary and special resolutions by companies : ICAI News

MCA has issued Clarification on the passing of ordinary and special resolutions by companies on account of the threat posed by Covid-19 and holding an extraordinary general meeting

Section 100 (1) of the Companies Act, 2013 (the Act), the Board may, whenever it deems fit, call an extraordinary general meeting (EGM) of the company. EGM of any company other than of the wholly-owned subsidiary of a company incorporated outside India shall be held at a place within India.

The Ministry of Corporate Affairs (the MCA) has issued two General Circulars No.14/2020 dated 8th April 2020 and 17/2020 dated 13th April 2020. The MCA has stated that due to the pandemic caused by COVID-19 prevailing which requires social distancing, Companies are 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 the mechanism of postal ballot e-voting in accordance with the provisions of the Act and rules made thereunder, without holding a general meeting, which requires the physical presence of members at a common venue.

Under unavoidable circumstances, holding an EGM by any company, the following prescribed procedure should be adopted for conducting EGM till 30.06.2020:

A. For Companies where e-voting is required/Companies opted for such facility:

  1. VC/OAVM: The EGMs may be held through video conferencing (VC) or other audio-visual means (OAVM) and transcript of the same shall be kept in safe custody. In the case of, Public Company, the same shall be uploaded on the website as soon as possible.
  2. Zones: Different time zones shall be kept in mind.
  3. Deliberations: There should be two-way conferencing with the facility to pose questions and participation by at least 1000 members (in case e-voting is allowed) on the first-come-first-served basis. Besides this, the promoters, chairman of the audit
  4. committee nomination and remuneration committee, stakeholders’ relationship committee institutional investors, directors, auditors should be allowed to join.
  5. Joining Time: The Facility for joining meetings shall remain open for at least 15 minutes before and after the timing of the meeting.

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ICAI News: MCA has issued Clarification on holding of Annual General meeting

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