Section 106Chapter 7

Restriction on voting rights

Regulation 10 of Takeover Code

Section 106.Restriction on voting rights.

(1)

Notwithstanding anything contained in this Act, the articles of a company may provide that no member shall exercise any voting right in respect of any shares registered in his name on which any calls or other sums presently payable by him have not been paid, or in regard to which the company has exercised any right of lien.

(2)

A company shall not, except on the grounds specified in sub-section (1), prohibit any member from exercising his voting right on any other ground.

(3)

On a poll taken at a meeting of a company, a member entitled to more than one vote, or his proxy, where allowed, or other person entitled to vote for him, as the case may be, need not, if he votes, use all his votes or cast in the same way all the votes he uses.

Notes, amendments & references (4)

This section shall apply to a private company and specified IFSC Public Company unless otherwise specified in respective sections or the articles of the Company provide otherwise Notification no. G.S.R. 464(E) dated 5th June 2015 and GSR 08(E) dated 4th January, 2017.

(The exceptions, modifications and adaptations provided above shall be applicable only to those Private Companies which has not committed a default in filing its financial statements under section 137 of the said act or annual return under section 92 of the said act with the registrar, vide notification dated 13th June 2017)

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Articles means the articles of association of a company as originally framed or as altered from time to time or applied in pursuance of any previous company law or of this Act