The Rules framed by the Central Govt. under the Companies Act 2013 with reference to “Management & Administration” is not clear as to the conduct of General Meetings of a company. Rule 20 (1)says every listed entity or a company having not less than 1000 shareholders shall provide to its members facility to exercise their right to vote at general meetings by electronic means. Sub rule (3) says that a company which “opts’ to provide electronic voting --. It should have been “a company which is required to provide for electronic voting” as per (1) above. Or whether the sub rule 3 is talking about the companies other than the companies mentioned in sub-rule 1.
When the company which is required under Sub-rule 1 to make a provision for electronic voting to its members has to give minimum voting period of one day and maximum period of three days to its members for voting as per sub-rule 3 (vi). Again the word used shall be “for” any general meeting and not “at” any general meeting, which would be more proper. The words “at any general meetings” generally interpreted to voting at the venue of the meeting.
Further a complete reading of the entire sub-rules 20 and 21 makes one to understand that there will be two votings for a same meeting one electronic which has to be closed three days prior to the general meeting and another one at the meeting venue which shall necessarily be a ballot voting by issuance of ballot paper. The Chairman of the meeting has to announce the result of the poll based on the report of the scrutinizer/s who have taken into account the votings at both the medium of polling viz: electronic as well as the ballot paper and after clubbing the said results. Also the persons who have exercised the voting under electronic means even if they attend the meeting will be barred from voting by ballot paper. This is in tune with rule 20 proviso to (3) (vii).
It is pertinent to note that with the rules coming into force now, the General Meetings are reduced to a forum meant only to seek clarifications or answers from the management rather than a true sense of a meeting. Or can it be called a meeting to declare the result of the poll in a broader sense.
While it is always in the interest of corporate democracy that voting is to be held to ascertain the opinion of majority of shareholders who could not come to the Registered Office which may be in far off places, yet with the advent of electronic saga, even General Meetings are mere formality only as the result of the agenda items are known three days ahead of any meeting.
With these rules coming into force the existing system of ascertaining the sense of the meeting by show of hands in the first place is done away with. The existing procedure in vogue at General Meetings to propose any resolution and another person seconding it would no longer exist. All the agenda items are the proposals of management represented by the Board who are the proposers of the agenda items.
Another point for the companies which are expected to go into electronic voting is that the notice of the meeting may say that Notice is hereby given that the meeting of the members of the company will be held to discuss the agenda items and to declare the results of the poll conducted through electronic voting.
Can i have your views and clarifications for the above.