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CS Executive · Company Law and Practice · Members and Shareholders

Nilgiri Tech Ltd, a listed company, has a small shareholders' director vacancy to fill. A member, Arjun, wants to propose a non-retiring person for directorship at the general meeting and asks about Section 160 notice requirements. Which statement is correct as per the Act?

Under Section 160, notice in writing must be left at the registered office not less than fourteen days before the meeting, along with a deposit of one lakh rupees or higher prescribed amount. It is refunded if the person is elected or gets over twenty-five per cent of valid votes.

  1. ANotice must be left at the registered office not less than fourteen days before the meeting, with a deposit of one lakh rupees or such higher amount as may be prescribedCorrect
  2. BNotice must be left at least seven days before the meeting, with no deposit in any case
  3. CNotice must be left fourteen days before the meeting, and the deposit is forfeited if the person gets less than fifty per cent of votes
  4. DNotice need not be in writing if the person is present at the meeting

Explanation

Section 160(1) requires a written notice at the registered office not less than fourteen days before the meeting, with a deposit of one lakh rupees or higher prescribed amount. The deposit is refunded if the person is elected or gets more than twenty-five per cent of total valid votes, so the fifty per cent option is wrong. The deposit is waived only for specified cases such as independent directors or NRC or Board recommended directors.

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