Types Of Voting Under Companies Act, 2013
Updated: Jun 21, 2022
The different types of voting under the Companies Act, 2013 are as follows:
1. SECTION 107 - VOTING BY SHOW OF HANDS
At any general meeting, a resolution put to the vote of the meeting shall, unless a poll is demanded under section 109 of the Companies Act 2013, of the voting is carried out electronically, be decided on a show of hands.
A declaration by the Chairman of the meeting of the passing of a resolution or otherwise by show of hands and an entry to that effect in the books containing the minutes of the meeting of the company shall be conclusive evidence of the path of the passing of such resolution or otherwise.
2. SECTION 108 - VOTING THROUGH ELECTRONIC MEANS
Section 108 of the Companies Act 2013 provides that the Central Government may prescribe the classes of companies or manner in which a member may exercise his right to vote by electronic means. Rule 20 amended by the Companies (Management and Administration) Rules 2015 and 2016 in this regard, provides that:
Companies having their equity shares listed on a recognized stock exchange or a company or a company having not less than 1 thousand members, shall provide to its members the facility to exercise their right to on resolutions proposed to be considered at general meetings by electronic means.
The aforesaid rule shall, however, do not apply to:
i) small and medium enterprises, namely, companies whose post-issue value capital is up to Rs. 25crores and whose shares are listed on SME Exchange.
ii) companies listed on the Institutional Trading Platform.
3. SECTION 109 - DEMAND FOR POLL
Section 109 of the Companies Act 2013 provides that, before or on the declaration of the result of the voting on any resolution on a show of hands, a poll may be ordered to be taken by the chairman of the meeting of his own motion, and shall be ordered to be taken by him on a demand made in that behalf by the persons specified below, namely :
a. In the case of a company having a share capital by any member or members present in a person or by proxy and holding shares in the company:
which gives the power to vote on the resolution not being less than 1/10th of the total voting power.
The total sum of a minimum of 5 lakhs or such a higher amount as may be prescribed has been paid up.
b. In the case of any other company by any member or members present in person or by proxy and having not less than 1/10th of the total voting power.
The demand for a poll may be withdrawn at any time by the persons who made the demand.
4. SECTION 110 - PASSING OF RESOLUTIONS BY POSTAL BALLOT
Section 110 of the Companies Act 2013 allows the casting of votes by a member through the postal ballot in certain cases and is subject to certain conditions. Voting by postal ballot means voting by post or through any electronic mode.
The provision of section 110 with respect to voting by postal ballot are as follows:
Shall in respect of such items of the business as the Central Government may by notification, declare to be by means of postal ballot.
May, in respect of any item of business (other than ordinary business and any business in respect of which directors or auditors have a right to be heard at any meeting), transact by means of postal ballot, instead of transacting such business at a general meeting.