CS Professional · Banking and Insurance - Laws and Practice · Control over Organization of Banks
Vindhya Bank Ltd has total voting rights of 50 crore votes on a poll, and the Reserve Bank has not raised the ceiling. Arjun Industries holds shares carrying 9 crore votes. Under Section 12(2) of the Banking Regulation Act, 1949, how many votes can it exercise on a poll?
Arjun Industries can exercise 5 crore votes. Section 12(2) bars exercising poll voting rights above ten per cent of total voting rights, and ten per cent of 50 crore votes is 5 crore, despite its 9 crore holding.
- A5 croreCorrect
- B9 crore
- C13 crore
- D4.5 crore
Explanation
The ceiling is ten per cent of total voting rights: 10% of 50 crore is 5 crore. Arjun holds 9 crore votes, but may exercise only 5 crore. The 9 crore option ignores the ceiling, and 13 crore would apply a 26 per cent ceiling, which needs a Reserve Bank increase.
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