Page 203 - DCOM106_COMPANY_LAW

Company Law

Notes Self Assessment

7. Can a Company hold an AGM on public holiday?
(a) Yes (b) No
(c) (a) and (b) both are correct (d) None

8. Audit of a public company will be counted for the limit of audits
(a) Yes (b) No
9. Statutory meeting must be held in case of a public company
(a) Yes (b) No
10. Statutory meeting must be held in case of a private company

(a) Yes (b) No

12.6 Resolutions

Decisions of a company are taken by resolution of its members, passed at their meetings. Also,
the Board of directors takes certain decisions at its meeting by passing certain resolutions after
due deliberations.
The term ‘motion’ indicates a proposition made at a meeting by any member. Such a motion
may be passed without any change or modification. But if some members feel that the motion in
the form proposed needs some change or modification, they may move an amendment.
A motion when passed with or without amendment is called a resolution.
A motion should always be in writing and before it is brought before the meeting, the necessary
notice must be given. A person proposing a motion is called the mover and the motion should
be signed by him.
Once the motion has been put to the members and they have voted in favour of it, it becomes a
resolution. In the case of a company, there are three kinds of resolutions:
1. Ordinary resolution;
2. Special resolution;

3. Resolution requiring special notice.

Task One general meeting was called by a company in December, 2004. This meeting
was adjourned to March, 2005 and then held. Subsequent meeting was held in February;
2006. Is the company liable for any irregularity?

12.6.1 Ordinary Resolution [s.189(1)]

When a motion is passed by a simple majority of the members voting at a general meeting, it is
said to have been passed by an ordinary resolution. In other words, votes in favour of the
resolution are more than 50%. Still in other words, a resolution shall be an ordinary resolution
where the votes cast in favour of the resolution are more than the votes cast against the resolution.
According to s.189(1), “A resolution shall be an ordinary resolution when at a general meeting
of which the notice required under the Act has been duly given, the votes cast (whether on show

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