Imagine you are a shareholder in Rajesh & Co. Pvt. Ltd. and the management is doing something shady — but the Board refuses to call a meeting to discuss it. What can you do? Section 100 gives you the power to force the company to hold an Extraordinary General Meeting (EGM) — a meeting called outside the regular AGM cycle, whenever urgent business needs shareholder attention.
The Board has the freedom to call an EGM anytime it thinks fit — no one can stop them. But the interesting (and exam-favourite) part is member requisition. If members holding at least 1/10th of the paid-up share capital (for companies with share capital) or 1/10th of total voting power (for companies without share capital) sign a written requisition and send it to the registered office, the Board is legally obligated to act. The requisition must clearly state the matters to be discussed — vague demands don't count.
Here's the critical timeline you must memorise: Once a valid requisition is received, the Board must proceed to call the meeting within 21 days, and the meeting itself must be held on a day not later than 45 days from the date of requisition. If the Board drags its feet and fails to act within 21 days, the requisitionists can call the meeting themselves — and they have 3 months from the date of requisition to do so. The company must reimburse all reasonable expenses incurred by the requisitionists, and that amount is recovered by deducting it from the remuneration of the defaulting directors under Section 197. One more rule to note: every EGM (except those of a wholly owned subsidiary of a foreign company) must be held within India.
This section is frequently tested as a 4-mark or 6-mark question asking you to explain the requisition process, the timelines, or what happens when the Board defaults. The 21-day / 45-day / 3-month sequence is a guaranteed exam trap — get it wrong and you lose easy marks.
📊 Worked example
Example 1: Does the requisition threshold meet the requirement?
Rajesh & Co. Pvt. Ltd. has a paid-up share capital of ₹50,00,000 divided into 5,00,000 equity shares of ₹10 each. All shares carry voting rights. A group of 12 shareholders collectively hold 48,000 shares. They want to call an EGM. Can they validly requisition?
Working:
- Required threshold = 1/10th of paid-up share capital = 1/10 × ₹50,00,000 = ₹5,00,000
- Shares held by requisitionists = 48,000 × ₹10 = ₹4,80,000
- ₹4,80,000 < ₹5,00,000 — threshold NOT met
Answer: No, the requisitionists fall short. They need shares worth at least ₹5,00,000 (i.e., 50,000 shares). The Board is not obligated to act on this requisition.
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Example 2: Board defaults — who calls the meeting, and what happens to expenses?
Ms. Iyer and other members of Alpha Ltd. send a valid requisition on 1st January 2025. The Board does not proceed to call the meeting within the required window. The requisitionists spend ₹80,000 calling and conducting the EGM themselves.
Working:
- Board must proceed to call meeting within: 1 Jan + 21 days = by 22nd January 2025
- Meeting must be held by: 1 Jan + 45 days = by 15th February 2025
- Board failed → requisitionists may call meeting within 3 months = by 31st March 2025 ✓
- Expenses of ₹80,000 must be reimbursed by the company
- Company recovers ₹80,000 by deducting from remuneration of defaulting directors under Section 197
Answer: The EGM is validly called by the requisitionists, ₹80,000 is reimbursed to them, and the defaulting directors bear this cost through a deduction in their remuneration.
⚠️ Common exam mistakes
- Confusing '21 days' with the date of the meeting — Students often write that the meeting must be held within 21 days. Wrong. The Board must proceed to call (i.e., issue notice for) the meeting within 21 days; the meeting itself must be held within 45 days of the requisition date.
- Forgetting the 3-month window for requisitionists — Many students stop at 'the requisitionists can call the meeting' without specifying the 3-month outer limit from the date of requisition. Always state the deadline.
- Applying the 1/10th test incorrectly — The threshold is 1/10th of paid-up share capital carrying voting rights, not total issued capital. If some shares are non-voting (e.g., preference shares without voting rights), exclude them from the denominator.
- Missing the venue rule — Students forget that an EGM must be held within India, except for a wholly owned subsidiary of a company incorporated outside India. This detail appears in MCQs.
- Ignoring the expense-recovery mechanism — Answers often say 'company pays expenses' but omit that the amount is recovered from defaulting directors' remuneration under Section 197. Including this earns the extra half-mark in a 6-mark question.
📖 Bare Act text — Section 100, Companies Act 2013
(click to expand)
(1) The Board may, whenever it deems fit, call an extraordinary general meeting of the company. Provided that an extraordinary general meeting of the company, other than of the wholly owned subsidiary of a company incorporated outside India, shall be held at a place within India. (2) The Board shall, at the requisition made by,— (a) in the case of a company having a share capital, such number of members who hold, on the date of the receipt of the requisition, not less than one-tenth of such of the paid-up share capital of the company as on that date carries the right of voting; (b) in the case of a company not having a share capital, such number of members who have, on the date of receipt of the requisition, not less than one-tenth of the total voting power of all the members having on the said date a right to vote, call an extraordinary general meeting of the company within the period specified in sub-section (4). (3) The requisition made under sub-section (2) shall set out the matters for the consideration of which the meeting is to be called and shall be signed by the requisitionists and sent to the registered office of the company. (4) If the Board does not, within twenty-one days from the date of receipt of a valid requisition in regard to any matter, proceed to call a meeting for the consideration of that matter on a day not later than forty-five days from the date of receipt of such requisition, the meeting may be called and held by the requisitionists themselves within a period of three months from the date of the requisition. (5) A meeting under sub-section (4) by the requisitionists shall be called and held in the same manner in which the meeting is called and held by the Board. (6) Any reasonable expenses incurred by the requisitionists in calling a meeting under sub-section (4) shall be reimbursed to the requisitionists by the company and the sums so paid shall be deducted from any fee or other remuneration under section 197 payable to such of the directors who were in default in calling the meeting.
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