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CS Executive · Company Law and Practice · General Meetings

At the AGM of Kaveri Textiles Ltd, a shareholder made a remark about the managing director that the Chairman, Mr. Rao, considers defamatory. The remark was also irrelevant to the agenda. What is the correct position on including it in the minutes?

The remark is not to be included. Under Section 118(5) and (6), matter that in the Chairman's opinion is defamatory, irrelevant or immaterial, or detrimental to the company stays out of the minutes, and the Chairman has absolute discretion. No member resolution or Registrar approval is needed.

  1. AIt must be included, because minutes need to record everything said
  2. BIt may be included only if the members pass an ordinary resolution
  3. CIt must be excluded, since the Chairman has absolute discretion over such matter on the specified groundsCorrect
  4. DIt may be excluded only with the approval of the Registrar

Explanation

Section 118(5) bars matter that the Chairman considers defamatory, irrelevant or immaterial, or detrimental to the company's interests. Under Section 118(6) the Chairman has absolute discretion on these grounds. No member vote or Registrar approval is needed.

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