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Microlesson · 5-min read

Postal Ballot — Applicability and Items (Section 110)

# Postal Ballot — Section 110

## Definition

Postal Ballot [Sec 2(65)] means voting by:

  • Post, OR
  • Electronic mode

It allows a resolution to be passed without convening a general meeting.

## Applicability — Two Categories

### (a) Items MANDATED for Postal Ballot

CG declares specific business items that MUST be transacted via postal ballot only.

### (b) Items OPTIONALLY transacted via Postal Ballot

A company may transact other business via postal ballot EXCEPT:

  • Ordinary business (i.e., business at AGM under Sec 102), OR
  • Items requiring hearing of directors or auditors

## Important Note

Items mandated for postal ballot under (a) may also be transacted at a general meeting if electronic voting (Sec 108) is provided.

## Exemption from Postal Ballot

  • One Person Companies (OPCs), AND
  • Companies with up to 200 members

are exempt from postal ballot requirements.

## Status of Resolution

A resolution approved by requisite majority via postal ballot is deemed as passed at a general meeting.

## Items Mandated for Postal Ballot

Sr. No.Business ItemSection
1Alteration of objects clause of memorandum (for existing companies: alteration of main objects)Sec 13
2Alteration of Articles of Association (e.g., inclusion/removal of provisions for private company)Sec 2(68)
3Change in registered office location beyond local limitsSec 12(5)
4Change in objects of raised funds (unutilized public funds)Sec 13(8)
5Issue of shares with differential voting/dividend rightsSec 43(a)(ii)
6Variation in rights of shares/debenturesSec 48
7Buy-back of sharesSec 68(1)
8Election of a director by small shareholdersSec 151
9Sale of whole/substantial undertakingSec 180(1)(a)
10Providing loans, guarantees, or securities exceeding prescribed limitsSec 186(3)

## Voting & Counting Under Postal Ballot

### Voting Rights

Proportional to the member's share in the paid-up capital.

### Types of Ballots

1. Assent ballots (in favor)

2. Dissent ballots (against)

3. Partial votes — partially assenting, partially dissenting, or not using all shares

4. Invalid ballots — signature issues, overwriting, etc.

### Approval Criteria

Resolution is deemed passed if assents EXCEED dissents (subject to requisite majority — Ordinary or Special as applicable).

Worked example

### Example 1

Example: XYZ Pvt. Ltd. has 180 members. It wishes to alter its main objects clause. Must it follow the postal ballot procedure?

Solution: No. Companies with up to 200 members are exempt from postal ballot. XYZ may pass the resolution at a general meeting through a Special Resolution.

### Example 2

Example: A listed company wants to alter its objects clause. Must it use postal ballot, or can it use the general meeting route?

Solution: Alteration of objects clause is mandated for postal ballot. However, since items mandated for postal ballot may also be transacted at a general meeting if e-voting is provided (Sec 108), and listed companies must provide e-voting, the company may use the general meeting route with e-voting.

⚠️ Common exam mistakes

  • Forgetting that ordinary business (AGM business) CANNOT be transacted via postal ballot
  • Including matters requiring director/auditor hearing in postal ballot — these are excluded
  • Thinking OPC must follow postal ballot — OPC and ≤200-member companies are exempt
  • Confusing the requirements for items in the mandated list — they can ALSO be done at GM if e-voting is provided
Reference: Sec 110 read with Sec 2(65) — Companies Act, 2013
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