ARPITA DEY

REGISTRATION NO: 120577855/02/2012

11/65 JHEEL ROAD
NEWLAND ,JADAVPUR
KOLKATA -700031

The Sr. Director (Training, Membership & Legal)

The Institute of Company Secretaries of India
C- 37, Sector- 62
Noida – 201309

Sub: Submission of Project Report

Respected Sir,

With reference to the captioned subject, I do hereby submit my Project report on subject of
“Postal Ballot” as required by your good selves.

Kindly do the needful & oblige.

Thanking You,

Your’s faithfully,

Arpita Dey
Reg. No: 120577855/02/2012

Encl: As above
CERTIFICATE

Certified that this project report on “Postal Ballot” is the bonafide work of

“Ms. Arpita Dey” Student Registration No. 120577855/02/2012 who

carried out the project work under my supervision

Sarika Mehra
Executive Director & Company Secretary
NPR Finance Ltd.

Place: Kolkata

Date: 14.12.2016
INFORMATION

Name of the trainee : Arpita Dey

Registration No. : 120577855/02/2012

Name of the Company : NPR Finance Ltd.

Period of Training : 19th March, 2015 to 14th December, 2016

ACKNOWLEDGEMENT

This project report is the outcome of fifteen months Management training as sponsored
by the Institute of Company Secretaries of India.

I had exposure to a variety of professional aspects relating to secretarial & legal

matters, during the training period. For all this and much more, I sincerely thank my
training supervisor, Mrs. Sarika Mehra, Director & Company Secretary of NPR
Finance Ltd., who provided an opportunity to learn and to feel responsible as well as to
exercise independence during the completion of tasks assigned to me.

(Arpita Dey)
PROJECT REPORT ON

POSTAL BALLOT

PREPARED BY:

ARPITA DEY

REG. NO: 120577855/02/2012

CONTENTS

1. DEFINITION

2. BUSINESS

3. NOTICE TO SHAREHOLDERS

4. MODE OF DISPATCH

5. PUBLIC ADVERTISEMENT

6. DETAILS OF ADVERTISEMENT

7. PLACE NOTICE ON WEBSITE

8. APPOINT SCRUTINIZER

9. OBLIGATION OF SCRUTINIZER

10. COMPANIES ACT 1956 VS COMPANIES ACT 2013

11. EXEMPTION

12. CONCLUSION
POSTAL BALLOT AND VOTING BY
ELECTRONIC MEANS UNDER COMPANIES
ACT 2013

1. Definition:

Postal Ballot is defined under section 2(65) means “voting by post or through any electronic
mode”. Postal Ballot definition was never given in the Companies Act, 1956 because the
concept of Postal Ballot was introduced into the Companies Act, 1956 by the 2001 Amendment
and postal ballot under the 1956 Act included only voting by postal ballot not by electronic
mode.

2. Postal Ballot – Business:

Section 110 of the Companies Act, 2013 refers to Postal Ballot. Section 110(a) refers to the
mandatory item which has to be transacted only by postal ballot specifies the list of items which
has to be mandatorily transacted only by postal ballot. These are:

(a) Alteration of the objects clause of the Memorandum of Association and in case of the
company already in existence ,immediately before the commencement of the Act, alteration of
the main objects of the Memorandum of Association;

(b) Alteration of Articles of Association in relation to insertion or removal of provisions which,

under sub-section (68) of section 2, are required to be included in the articles of a company in
order to constitute it a private company;

Section 2 Sub section (68) defines the Private Company. The “private company” means a
company having a minimum paid-up share capital of one lakh rupees or such higher paid-up
share capital as may be prescribed, and which by its articles,—
(1). restricts the right to transfer its shares;
(2). except in case of One Person Company, limits the number of its members to
two hundred:

Provided that where two or more persons hold one or more shares in a company jointly, they
shall, for the purposes of this clause, be treated as a single member:
Provided further that—

 persons who are in the employment of the company; and

 persons who, having been formerly in the employment of the company, were members
of the company while in that employment and have continued to be members after the
employment ceased,
shall not be included in the number of members; and

(3) prohibits any invitation to the public to subscribe for any securities of the company;

(c) Change in place of registered office outside the local limits of any city, town or village as
specified in sub-section (5) of section 12;

(d) Change in objects for which a company has raised money from public through prospectus
and still has any unutilized amount out of the money so raised under sub-section (8) of section
13;

(e) Issue of shares with differential rights as to voting or dividend or otherwise under sub-clause
(ii) of clause (a) of section 43;

(f) Variation in the rights attached to a class of shares or debentures or other securities as
specified under section 48;

(g) Buy-back of shares by a company under sub-section (1) of section 68;

(h) Election of a director under section 151 of the Act;

(i) Sale of the whole or substantially the whole of an undertaking of a company as specified
under sub-clause (a) of sub-section (1) of section 180;

(j) Giving loans or extending guarantee or providing security in excess of the limit prescribed
under sub-section (3) of section 186;

Section 110(b) specifies that a company MAY in respect of any items of business other than
ordinary business and any business in respect of which the directors and auditors have a right
to be heard, transact by postal ballot. So this is a discretion on the part of the company to
transact any business which does not fall under the list of mandatory and which is not ordinary
business to have such items transacted by postal ballot. Any business where the directors or
auditors have a right to be heard refers to the resolution for the removal of the directors or
auditor.

Items of business that cannot be transacted through postal ballot :

Apart from the above, a company may, at its discretion, transact any other item of business also
through voting by postal ballot instead of transacting it at a general meeting, except the
following businesses:

1. Consideration of financial statements and the reports of the Board of Directors and
auditors.
2. Declaration of any dividend
3. Appointment of directors in place of those retiring.
4. Appointment of and the fixing of the remuneration of the auditors.
5. Business in respect of which directors or auditors have a right to be heard at any
meeting.

Rule 22 of the Companies (Management and Administration) Rules,2014 lays down the
procedure to be followed by companies while transacting business through postal
ballot.

For the purposes of section 110, where a company is required or decides to pass any resolution
by way of postal ballot, it shall send a notice to all the shareholders, along with a draft resolution
explaining the reasons therefore and requesting them to send their assent or dissent in writing
on a postal ballot or by electronic means within a period of thirty days from the date of dispatch
of the notice.

3. Notice to Shareholders:

The notice shall be sent by speed post or registered post acknowledgement due or by electronic
means and shall include with the notice where it is sent by post, a postage pre-paid envelope
for facilitating the communication of the assent or dissent of the shareholder to the resolution
within the said period of thirty days.

4. Mode of dispatch:

The notice shall be sent either:

 by Registered Post or speed post, or

 through electronic means like registered e-mail id or

 through courier service for facilitating the communication of the assent or dissent of the
shareholder to the resolution within the said period of thirty days.
5. Publish advertisement:

An advertisement shall be published at least once in a vernacular newspaper in the principal

vernacular language of the district in which the registered office of the company is situated, and
having a wide circulation in that district, and at least once in English language in an
English newspaper having a wide circulation in that district, about having dispatched the
ballot papers and specifying therein.

6. Details of Advertisement:

 a statement to the effect that the business is to be transacted by postal ballot which
includes voting by electronic means;

 the date of completion of dispatch of notices;

 the date of commencement of voting;

 the date of end of voting;

 the statement that any postal ballot received from the member beyond the said date will
not be valid and voting whether by post or by electronic means shall not be allowed
beyond the said date;

 a statement to the effect that members, who have not received postal ballot forms may
apply to the company and obtain a duplicate thereof; and

 contact details of the person responsible to address the grievances connected with the
voting by postal ballot including voting by electronic means.

7. Place notice on website:

The notice of the postal ballot shall also be placed on the website of the company forthwith after
the notice is sent to the members and such notice shall remain on such website till the last date
for receipt of the postal ballots from the members.

8. Appoint Scrutinizer:

The Board of directors shall appoint one scrutinizer, who is not in employment of the company
and who, in the opinion of the Board can conduct the postal ballot voting process in a fair and
transparent manner.

9. Obligation of Scrutinizer:
  The scrutinizer shall be willing to be appointed and be available for the purpose of
ascertaining the requisite majority.

 Postal ballot received back from the shareholders shall be kept in the safe custody of
the scrutinizer and after the receipt of assent or dissent of the shareholder in writing on
a postal ballot, no person shall deface or destroy the ballot paper or declare the identity
of the shareholder

 The scrutinizer shall submit his report as soon as possible after the last date of receipt of
postal ballots but not later than seven days thereof

 The scrutinizer shall maintain a register either manually or electronically to record

their assent or dissent received, mentioning the particulars of name, address, folio
number or client ID of the shareholder, number of shares held by them, nominal value of
such shares, whether the shares have differential voting rights, if any, details of postal
ballots which are received in defaced or mutilated form and postal ballot forms which are
invalid.

 The postal ballot and all other papers relating to postal ballot including voting by
electronic means, shall be under the safe custody of the scrutinizer till the chairman
considers, approves and signs the minutes and thereafter, the scrutinizer shall return
the ballot papers and other related papers or register to the company who shall
preserve such ballot papers and other related papers or register safely.

 The assent or dissent received after thirty days from the date of issue of notice shall
be treated as if reply from the member has not been received.

 The results shall be declared by placing it, along with the scrutinizer’s report, on
the website of the company.

The provisions of rule 20 regarding voting by electronic means shall apply, as far as
applicable, mutatis mutandis to this rule in respect of the voting by electronic means.

10. Postal Ballot – Companies Act, 1956 Vs Companies Act,2013:

Governing sections & Section 192A & The Companies Section 110 & Rule- 22 of Companies
rules (Passing of the Resolution by Postal (Management and Administration) Rules,
Ballot) Rules, 2001 2014 (Chapter VII)
Applicability Listed public companies All companies, whether public or private
having more than 200 members (One
Person Company exempted)
Items of business Nine (09) items of business notified Total 10 items of business notified under the
notified by CG under the aforesaid rules. aforesaid rules. New item of business:
Change in objects for which a company has
raised money from public through
prospectus and still has any unutilized
amount out of the money so raised under
section 13(8) of CA, 2013. Refer to
Annexure I for detailed list of specified
business to be transacted only through
postal ballot process and; Refer to
Annexure II for items of business that
cannot be transacted through postal ballot
process
Mode of posting notice  Registered Post  Registered Post
Acknowledgement Due or  Speed Post
 Other secured mode of  Electronic mails
posting provided by  Courier service
Department of Post
 Electronic mail

Newspaper List of five matters specified. List of seven matters specified with the
advertisement following two new inclusions:

i. A statement to the effect that the

business is to be transacted by
postal ballot which includes voting
by electronic means and
ii. Contact details of the person
responsible to address the
grievances connected with the
voting by postal ballot including
voting by electronic means.

Please refer to Annexure III for detailed list

of matters to be included in the newspaper
advertisement
Intimation to ROC Mandatory to file board resolution Not required.
and calendar of events within one
week of Board Meeting. General
circular no. 16/2001 dated 24th July,
2001
Scrutinizer’s Report As soon as possible after the last As soon as possible but not later than seven
date of receipt of the postal ballot. (07) days from the last date of receipt of
postal ballot.
Placing notice/ results of Not specifically mentioned Required to be placed on the website
postal ballot on website

11. Exemptions:

 One Person Company and

 other companies having members up to two hundred

are not required to transact any business through postal ballot

12. Conclusion

The scope for Company secretary in Practice has been enhanced with the Scrutinizer’s
requirement for postal ballot and also for Electronic Voting process.

……………………………………………………………………………