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CMA Intermediate · Business Laws and Ethics · Rights of Shareholders

Under Section 47 of the Companies Act, 2013, the voting right of an equity shareholder of a company limited by shares on a poll is determined in which manner?

On a poll, an equity shareholder's voting right is in proportion to his share in the company's paid-up equity share capital, as provided by Section 47(1)(b). The one-member-one-vote rule is not the general rule for companies limited by shares.

  1. AOne vote per member irrespective of shares held
  2. BIn proportion to his share in the paid-up equity share capital of the companyCorrect
  3. CIn proportion to the total issued capital including preference capital
  4. DIn proportion to the dividend received by him in the last year

Explanation

Section 47(1)(b) states that the voting right of a member holding equity shares on a poll is in proportion to his share in the paid-up equity share capital. One vote per member applies to producer companies with individual members, not ordinary companies. Including preference capital or dividends has no basis in the section.

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