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Section 110: Postal ballots

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Section 109 All 470 Sections of Companies Act Section 111
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Legal Commentary & Landmark Judgments: Section 110

Section 110 governs the passing of shareholder resolutions by postal ballot (including electronic voting), requiring mandatory postal ballot for critical corporate structural changes.

  • Statutory Rights & Obligations: Section 110 mandates that a company shall pass prescribed resolutions by means of postal ballot instead of transacting such business at a general meeting, while permitting other resolutions (except ordinary business and matters where directors or auditors have a right to be heard) to be transacted by postal ballot.
  • Operational Statutory Rights & Obligations: Matters mandatorily requiring postal ballot under Rule 22 include alteration of object clauses, shifting registered office outside local limits, alteration of articles regarding private company status, buyback of shares, issue of shares with differential rights, and sale of the whole or substantial undertaking under Section 180(1)(a).

If a resolution is assented to by the requisite majority via postal ballot, it is deemed to have been duly passed at a general meeting.

Key Landmark Precedents:
  • Securities and Exchange Board of India v. Sterlite Industries (India) Ltd. (2003) 113 Comp Cas 273: The High Court recognized postal ballots as a statutory safeguard ensuring that all dispersed shareholders have equal opportunity to vote on transformative corporate changes without logistical barriers.
  • LIC of India v. Escorts Ltd. (1986) 1 SCC 264: The Supreme Court highlighted the paramount importance of democratic shareholder expression on foundational corporate actions.
Legal Commentary:

Section 110 eliminates physical meeting coercion by enabling shareholders to vote privately via physical ballot or secure e-voting portals. For listed entities, any attempt to push through critical asset sales or charter alterations at a physical meeting without conducting a mandatory postal ballot is an incurable statutory violation that renders the resolution void.

Section 109 All 470 Sections of Companies Act Section 111