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CMA Intermediate · Business Laws and Ethics · Rights of Shareholders

Mr. Sen holds 500 equity shares of a company and is entitled on a poll to 500 votes. Under Section 106(3), which statement is correct?

He need not use all his votes or cast them all the same way. Under Section 106(3), on a poll a member with more than one vote, or his proxy, may use only some votes and may split them between for and against.

  1. AHe must cast all 500 votes in the same way
  2. BHe must use all 500 votes if he votes at all
  3. CHe need not use all his votes, nor cast in the same way all the votes he uses, if he votesCorrect
  4. DHe may vote only through a proxy on a poll

Explanation

Section 106(3) states that on a poll a member entitled to more than one vote, or his proxy where allowed, need not, if he votes, use all his votes or cast in the same way all the votes he uses. So he may split his votes, for example 300 for and 100 against. Requiring all votes to be used or cast alike contradicts this.

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