E-Voting by Shareholders-Companies Act and procedure - Professionals - Legal - TIK Share
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E-Voting by Shareholders-Companies Act and procedure


Rahul Rai

2015-07-28

One of the listed company is my client. Company wants advice on E-voting procedures.

My questions are:

  1. What is the procedure that Company should undertake to enable Evoting by its shareholders?
  2. What needs to be done by different users example Company, RTA, Scrutinizer?
  3. Is there any change in vote results report that should be given by scrutinizer? Can you please provide the format of report?

CS Sneha Richard

2015-07-28

Hello Rahul,

the relply to your queries are

Procedure to be followed for E-voting

Section 108 of the Companies, Act 2013 read with rule 20 of the Companies (Management and Administration) Rules, 2014 deals with the provisions of e-voting.

Applicability:

(1) Every listed company or a company having not less than one thousand shareholders shall provide to its members facility to exercise their right to vote at general meetings by electronic means. 

The procedure to be followed is

  1. A Notice shall be sent to all the members, directors & auditor of the Company either through Registered post, email, or courier. The notice shall also be placed on the website of the Company (if any) once it is sent to the members. It shall contain the following details

                      a.Agenda of the meeting (Matters to be discussed)

 

b. Business to be transacted through E-Voting (Clearly mentioning that the company is providing the e-voting facility)

 

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Rahul Rai

2015-07-28

Do you have format of Scrutinizer report?

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CS Sneha Richard

2015-07-28

Sorry for the earlier post. The site doesnt have edit options, so the post submitted was incomplete

Procedure to be followed for E-voting

Section 108 of the Companies, Act 2013 read with rule 20 of the Companies (Management and Administration) Rules, 2014 deals with the provisions of e-voting.

Applicability:

(1) Every listed company or a company having not less than one thousand shareholders shall provide to its members facility to exercise their right to vote at general meetings by electronic means.

The procedure to be followed is

  1. A Notice shall be sent to all the members, directors & auditor of the Company either through Registered post, email, or courier. The notice shall also be placed on the website of the Company (if any) once it is sent to the members. It shall contain the following details
  • Agenda of the meeting (Matters to be discussed)
  • Business to be transacted through E-Voting (Clearly mentioning that the company is providing the e-voting facility)
  • Time and day of meeting, along with the procedure to be carried out for e-voting & details about generating their user id and password for the same.
  • Publish the advertisement in newspaper in not less than 5 days before the beginning of the voting period. And the advertisement should be in at least in one vernacular language of the district in which registered office of the company is situated and one in English specifying the following details
    • statement that the business may be transacted by electronic voting
    • the date of completion of sending of notices
    • the date and time of commencement of voting through electronic means
    • the date and time of end of voting through electronic means
    • the statement that voting shall not be allowed beyond the said date and time
    • website address of the company and agency, if any, where notice of the meeting is displayed  
    • contact details of the person responsible to address the grievances connected with the electronic voting;

 

  1. The E-voting shall remain open for more than one day but less than 3 days (In all such cases, such voting period shall be completed three days prior to the date of the general meeting )
  2. During the e-voting period, shareholders of the company, holding shares either in physical form or in dematerialized form, as on the record date, may cast their vote electronically
  3. Once the Shareholder has cast his vote he cannot change it
  4. At the end of the voting period, the portal where votes are cast shall forthwith be blocked.
  5. The scrutinizer

 

  1. The Board of directors shall appoint one scrutinizer, who may be chartered Accountant in practice, Cost Accountant in practice, or Company Secretary in practice or an advocate, but not in employment of the company and is a person of repute who, in the opinion of the Board can scrutinize the e-voting process in a fair and transparent manner
  2. The scrutinizer shall be willing to be appointed and be available for the purpose of ascertaining the requisite majority
  3. He scrutinizer shall maintain a register either manually or electronically to record the assent or dissent, received, mentioning the particulars of name, address, folio number or client ID of the shareholders, number of shares held by them, nominal value of such shares and whether the shares have differential voting rights
  4. He shall within a period of not more than 3 days from the date of conclusion of e-voting period, unblock the votes in the presence of at least two witnesses not in the employment of the company and make a scrutinizer’s report of the votes cast in favor or against, if any, forthwith to the Chairman
  5. The register and all other papers relating to electronic voting shall remain in the safe custody of the scrutinizer until the chairman considers, approves and signs the minutes and thereafter, the scrutinizer shall return the register and other related papers to the company

 

  1. The results declared along with the scrutinizer’s report shall be placed on the website of the company and on the website of the agency within two days of passing of the resolution at the relevant general meeting of members
  2. Subject to receipt of sufficient votes, the resolution shall be deemed to be passed on the date of the relevant general meeting of members

 

 

What needs to be done by  different users example Company, RTA, Scrutinizer

 

  • A company desiring to use the e-Voting system has to sign the agreement and accept the terms and conditions for usage of the agency registered providing e-Voting platform.
  • The company through its Register and Transfer Agent (RTA) will set up the e-voting schedule on its website. The company will upload the resolutions on which voting is required and generate an Electronic Voting Sequence Number (EVSN) / Electronic Voting Even Number (EVEN). The Company will upload the Register of Members.
  • The agency will generate the password for each shareholder and print the same in a secured manner, which is to be sent to all the shareholders.
  • The company will then communicate the password, EVSN / EVEN and the procedure for e-voting along with the notice of resolution to all the shareholders.
  •  At the end of the voting period, the portal where votes are cast will be blocked and no additional votes will be accepted by the company.
  • After the voting period is over, a scrutinizer prepares a report of the votes cast in favour or against, if any, forthwith to the Chairman.
  • A scrutinizer is an individual who monitors the entire process of e-voting.
  • In terms of Clause 35A of the Listing Agreement, the listed companies are also required to submit the details of voting results to the stock exchange, within 48 hours of conclusion of General Meeting

  

Rest complete and clear details, terms & conditions regarding the procedure to generate the user id’s and passwords and voting system shall be explained /given by the agency with which the Company registers to avail the E-voting facility

 

Agency providing E-voting Platform shall have Website Quality Certificate from the Standardization Testing and Quality Certification (STQC) Directorate, Department of Information Technology, Ministry of Communications & IT, Government of India

NSDL & CDSL are one of them.

  Since the topic is quite vast I couldn’t cover every minute detail. You can ask if you have any further queries. 

Also the article is only for information. Kindly read the legal sections before acting upon it.

Format of report is attached. Kindly change it accordingly.

 MGT-13-format.docx 

 

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