conducting of AGM by foriegn subsidiary

[krishnamurthyvc]

 
One private limited company registered in India has only two foreign directors and two foreign shareholders.

The company wants to conduct AGM by taking attendance of proxies appointed by shareholders. The question,

Who shall Preside as chairman of the meeting? can a proxy be act as a chairman of the meeting.

Xpert opinion is hereby solicited.

Thanks

Krishnamurthy V. C.
Ph:91-80-2679 2387 / 9845816105
email:vckm...@gmail.com

[Narayan S]

Hi

 

According to Companies act,1956 in case of a Pvt ltd company minimum 2 members should be personally present to attend the meeting. In other words proxy cannot be appointed for that minimum 2 members.

 

In you case since you say there are only 2 members they need to attend the AGM in person otherwise there would not be any quorum. Proxy will not be counted for quorum purpose also.

 

The only option that is left out is these two members can execute specific power of attornery authorising two persons to attend on their behalf. I suggest you to check on this since i am not too sure abt this idea.

 

Regards

S.Narayan

[madhwesh acharya]

Dear krishnamurthy,

 

i agree with Narayan, that for pvt comps there should be minimum 2 members personally present for AGM.

 

Option 1:

 

Section 174(1) provides for the same.

 

hence in your case, the shareholders should personally come to the place of registered office and attend the meeting.

 

however, there is an exemption.

 

Option 2:

 

You may note that section 166(2) requires the place of AGM should be the registered office or any other place within the city.

 

first proviso to the said sub section provides that Central Government may exempt certain class of companies from the requirement of the aforesaid sub section.

 

if such an exemption can be obtained, as to the place of holding the AGM, it will solve your problem and you can hold your AGM in the country where the shareholders are located.

 

however, i am not so sure whether it is a power to give general exemption or company specific exemption. Your may try writing to MCA quoting this matter. I believe MCA might give exemption owing to the cercumstances of the company.

 

to handle subsequent AGMs:

 

please note that the second proviso to section 166(2), reads as

 

"(a) a public company or a private company which is a subsidiary of a public company, may by its articles fix the time for its annual general meetings and may also by a resolution passed in one annual general meeting fix the time for its subsequent annual general meetings; and
 

(b) a private company which is not subsidiary of a public company, may in like manner and also by a resolution agreed to by all the numbers thereof, fix the time as well as the place for its annual general meetings"

 

in the AGM held for such first time, either under option 1 or 2, you may pass a resolution effecting "(b)". I.e., pass a resolution for altering AOA to provide for such provision and pass another resolution for fixing the place of AGM/ GM  from next time. here you may fix the foreign place for holding AGM/ GM.

 

however, i am not so sure, whether the central government's exemption can be obtained for all the subsequent years. And even whether such continuous approval would be required or not.

 

Learned group member's inputs invited.

 

Madhwesh Krishna Acharya,

Company Secretary,

Kurlon Limited

Bangalore

9945399584

9945399584

[Priti Astarag Patnaik]

Hi ,

this case is very intresting one.

 

As per Table A clause 50 of Schedule I of the act , chairman of the Board shall preside at the general meeting.

as per clause76 board may elect a chairman of the board and determine the period of his office.

as per clause 76 any person even a non-member can be appointed as the chairman of the Board and in turn chairman of the general meeting,as clause76 does not speaks any where that chairman should be adirector or a member of the company.

 

And regarding the question about the quorum (i.e. 2 members should be personally present) :-
 

As per Section 170 of Companies Act1956, Provisions of section171 to section 186 shall not apply to Pvt company which is not the subsidiary of a Public Company if its articles provides otherwise.

 

So, ammend ur article regarding quorum  for general meeting to just by-pass the  Act.

i.e. make it like this ;

 

2 members present in person or by proxy shall form the quorum for any general meeting.

 

regards,

patnaik
 

On 5/20/08, Narayan S <naraya...@gmail.com> wrote: