All posts by Srishti Bathla

“Duties and Responsibilities of a Scrutinizer Under Companies Act, 2013” (For E-Voting)

E-VOTING (Section 108, Rule 20 of Companies (Management and Administration) Rules, 2014.

Applicability of section 108 Following companies are mandatorily required to provide e-voting facility:

  • Every Company [other than specified small & medium Enterprises] having its equity shares listed on Recognized Stock Exchange, or
  • A Company having 1000 or more members.

However, it is optional for others.

APPOINTMENT OF SCRUTINIZER

PURPOSE OF APPOINTMENT To scrutinize the voting and e-voting process in a fair and transparent manner.
ELIGIBILITY FOR APPOINTMENT OF SCRUTINIZER Following person may be appointed as a Scrutinizer:

  1. A Company Secretary in Practice, or
  2. Any other professional from other Institutes as prescribed,

The Scrutinizer should not be in employment of the Company and should be a person of repute.

BOARD RESOLUTION The Board is the appointing authority who may appoint one or more scrutinizer.

The Board may even pass the resolution through Circulation or video-conferencing.

CONSENT LETTER The scrutinizer should give a consent letter to the Company stating his willingness and eligibility.

DUTIES OF SCRUTINIZER

ALLOW ELIGIBLE MEMBERS TO VOTE The Scrutinizer should make sure that only members who are eligible to vote as on cut-off date shall cast their vote.

[cut-off date: date not earlier than 7 days before the date of General Meeting]

ASSIST CHAIRMAN The scrutinizer shall assist the chairman of the AGM/ GM, to conduct voting by ballot paper/electronically at the AGM/ GM.
VALIDITY OF VOTES If a member who cast a vote physically at the AGM/ GM despite casting his vote through remote e-voting, only his earlier vote shall be considered valid.
SECRECY OF VOTES The assent or dissent of members shall remain secret to the Chairman/ Scrutinizer till the votes are cast at the AGM/ GM.
POST VOTING COMPLIANCES After the conclusion of voting process at the AGM, the Scrutinizer shall:

  • Count the votes cast at the AGM/ GM,
  • Count the votes cast through remote e-voting process, (in the presence of 2 witness who are not in employment of the Company).
  • Make a consolidated Scrutinizer’s Report within 3 days and send it to the Chairman for his countersignatures.

There is no prescribed format for “Consolidated Scrutinizer’s Report”, however, Form No. MGT-13 is prescribed only under Section 109 of the Companies Act, 2013 (Demand for Poll).

MAINTAINING REGISTERS Maintain register manually or electronically regarding the assent or dissent of the members and their:

  • Name, Address, Folio no./ client ID, and No. of shares held.
SAFE CUSTODY The Scrutinizer should keep the safe custody of all the registers and papers and return the same to the Company only when the Chairman approves and sign the minutes.

RIGHTS OF SCRUTINIZER

ASSISTANCE The scrutinizer may take assistance of a person who is:

  • not in employment of the Company and
  • Well versed with electronic voting system.

MISCELLANEOUS

TIMELINES
  1. A notice (with the details of e-voting) by way of advertisement shall be published at least 21 days before the date of AGM/ GM.
  2. Facility of remote e-voting shall remain open for at least3 days and shall close at 5.00 p.m. on the date preceding the date of AGM/ GM.
  3. After the end of remote e-voting period, the facility shall be blocked.
Polling in the AGM/ GM In the AGM/ GM, voting may be done through polling method which includes polling by way of polling paper or through electronic mode.
Addressing Grievances The Scrutinizer should check whether the grievances of the members regarding e-voting are addressed properly by the concerned person.
Voting by Shareholders holding physical shares Even the shareholders not holding shares in a demat form, can also vote electronically.
Quorum Quorum in case of Public Company:

  • 5 members; if total members are not more than 1000,
  • 15 members; if total members are more than 1000 but does not exceed 5000,
  • 30 members; if total members exceeds 5000.

Quorum in case of Private Company: 2 members

As per our understanding, a person who has cast his vote through remote e-voting and also present in the AGM/ GM, shall be counted for the purpose of quorum. However, he will not be eligible to vote again.

 

Duties of Scrutinizer Under Companies Act, 2013 (Postal Ballot)

 

 

Postal Ballot (Section 110, Rule 22 of the Companies (Management and Administration) Rules, 2014.
Applicability of Section 110 Postal Ballot is applicable on all the Companies having 200 or more members. Therefore, private companies and OPC lies outside the purview of section 110.
MEANING OF POSTAL BALLOT
Postal Ballot includes E-voting Postal Ballot includes:

  • Voting through Postal Ballot Paper, and
  • Electronic Voting
Reply from the Shareholders within 30 days Voting process, either by Postal ballot paper or electronically, is open for 30 days from the date of dispatch of notice.
BUSINESS THAT NEEDS TO BE TRANSACTED ONLY THROUGH POSTAL BALLOT
  • Alteration of object clause of the MOA/ main object of MOA
  • Alteration of AOA
  • Change in place of Registered Office
  • Change in objects for which company has raised money from public and such money is unutilized
  • Issue of shares with differential rights as to voting/dividend
  • Variation in rights attached to a class of shares/ debentures/ other securities.
  • Buy-back of shares
  • Appointment of a director elected by shareholders
  • Sale of whole/ substantial part of an undertaking
  • Giving loans/ guarantee/ security in excess of time limits
  • Others as prescribed
ELIGIBILITY AND DUTIES OF SCRUTINIZER
ELIGIBILITY A Scrutinizer shall not be in employment of the Company and should conduct the voting process in fair and transparent manner.
BOARD RESOLUTION The Board is the appointing authority who may appoint one scrutinizer.
CONSENT LETTER

 

The scrutinizer should give a consent letter to the Company stating his willingness and eligibility.
SAFE CUSTODY

1. Postal Ballot

2. Other papers

 

1. The scrutinizer shall keep the safe custody of the Postal Ballots.
2. The Scrutinizer should keep the safe custody of all the registers and papers and return the same to the Company only when the Chairman approves and sign the minutes.
SCRUTINIZER’S REPORT The scrutinizer shall submit his report within 7 days of last date of receipt of postal ballot.
MAINTAINING REGISTERS Maintain register manually or electronically regarding the assent or dissent of the members and their:

  • Name,
  • Address,
  • Folio no./ client ID
  • No. of shares held and their nominal value,
  • Differential voting rights, if any
  • Details of postal ballot
MISCELLENEOUS
VALIDITY OF VOTESAFTER 30 DAYS Assent or dissent received from the members after 30 days from issue of notice shall not be considered.