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Section 171: Members? right to inspect

Companies Act • Official Statutory Text & Practice Guide

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Act 2013
Section 170 All 470 Sections of Companies Act Section 172
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Legal Commentary & Landmark Judgments: Section 171

Section 171 of the Companies Act, 2013 secures the statutory right of members to inspect the Register of Directors, Key Managerial Personnel, and their shareholding during business hours and at every annual general meeting, backed by summary administrative enforcement orders by the Registrar.

  • Member's Right of Inspection and Extracts: The Register maintained under Section 170 must be kept open for inspection by members during business hours without fee, and members have the statutory right to take extracts and demand copies within thirty days upon payment of prescribed fees.
  • Mandatory Availability at Annual General Meetings: The Register of Directors and KMP must be produced at the commencement of every annual general meeting and remain open and accessible during the meeting to all persons entitled to attend.
  • Registrar's Compelling Order upon Denial: Section 171(2) empowers the Registrar, upon receiving an application alleging refusal of inspection or non-delivery of copies, to pass an immediate order compelling inspection or directing that copies be furnished forthwith.
Key Landmark Precedents:
  • L.I.C. of India v. Escorts Ltd., (1986) 1 SCC 264: The Supreme Court held that the statutory inspection and information rights conferred on members are fundamental to corporate democracy and cannot be curtailed by managerial resistance.
  • Maknam Investments Ltd. v. Anandilal Poddar & Co., (2000) 100 Comp Cas 485 (Cal): The Calcutta High Court held that the right of inspection is an absolute statutory entitlement; wrongful refusal of inspection by company officers gives immediate cause of action for administrative and judicial intervention.
Courtroom Practice & Strategic Litigation Guidance:

When preparing an oppression petition under Section 241, serve a formal written requisition under Section 171 demanding inspection and certified extracts of the Register of Directors and KMP. If management ignores or refuses the request, submit an immediate application to the Registrar under Section 171(2) for an order compelling inspection; the refusal letter or RoC complaint provides crucial contemporaneous evidence of shareholder suppression.

Section 170 All 470 Sections of Companies Act Section 172