Quorum for meetings
Section 103 of the Companies Act, 2013 outlines the rules regarding the quorum required for company meetings. Here’s a simplified explanation in plain language:
Quorum Requirements:
Public Company:
- Less than 1,000 members: At least 5 members must be present.
- 1,000 to 5,000 members: A quorum is 15 members.
- More than 5,000 members: 30 members must be present.
Private Company:
- A minimum of 2 members is required to form a quorum.
Adjournment and Cancellation:
- If the quorum isn’t met within 30 minutes of the scheduled meeting time:
- Adjournment: The meeting is postponed to the same time and place the following week, or as determined by the Board.
- Cancellation: If the meeting was requisitioned under Section 100, it stands canceled.
Notice for Adjourned Meetings:
- In case of an adjourned meeting or a change in the meeting details:
- The company must provide at least three days’ notice to members individually or through newspaper advertisements.
Exceptions:
Private Company:
- Section 103 applies unless stated otherwise in the company’s articles or specific sections.
- (Example: If a private company’s articles state a different quorum, that takes precedence.)
Specified IFSC Public Company:
- Section 103 applies unless the company’s articles state otherwise.
- (Example: If a Specified IFSC Public Company’s articles specify a different quorum, that prevails.)
COVID-19 Clarification:
- Special provisions may apply due to the threat of COVID-19, ensuring flexibility in passing resolutions.
Examples to Illustrate:
- Public Company Example: If XYZ Public Company has 3,000 members, they need at least 15 members present to start the meeting.
- Private Company Example: ABC Private Company, with only 2 members, can commence a meeting as they meet the quorum requirement.
In essence, Section 103 sets the minimum number of members needed for a valid meeting, with exceptions for private and specified IFSC public companies, and considerations for extraordinary circumstances like the COVID-19 pandemic.
Complete legal text of Section 103 of the Companies Act 2013
(1) Unless the articles of the company provide for a larger number,—
(a) in case of a public company,—
(i) five members personally present if the number of members as on the date of meeting is not more than one thousand;
(ii) fifteen members personally present if the number of members as on the date of meeting is more than one thousand but up to five thousand;
(iii) thirty members personally present if the number of members as on the date of the meeting exceeds five thousand;
(b) in the case of a private company, two members personally present, shall be the quorum for a meeting of the company.
(2) If the quorum is not present within half-an-hour from the time appointed for holding a meeting of the company—
(a) the meeting shall stand adjourned to the same day in the next week at the same time and place, or to such other date and such other time and place as the Board may determine; or
(b) the meeting, if called by requisitionists under section 100, shall stand cancelled:
Provided that in case of an adjourned meeting or of a change of day, time or place of meeting under clause (a), the company shall give not less than three days notice to the members either individually or by publishing an advertisement in the newspapers (one in English and one in vernacular language) which is in circulation at the place where the registered office of the company is situated.
(3) If at the adjourned meeting also, a quorum is not present within half-an-hour from the time appointed for holding meeting, the members present shall be the quorum.]
Exceptions/ Modifications/ Adaptations
1. In case of private company – section 103 shall apply, unless otherwise specified in respective sections or the articles of the company provide otherwise. – Notification dated 5th june, 2015.
2. In case of Specified IFSC Public Company – section 103 shall apply in case of a Specified IFSC public company, unless otherwise specified in the articles of the company. Notification Date 4th January, 2017.
Note :
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