Resolution

Q-01: Define resolution.

Ans. For Q-01 :

A resolution is motion or proposition with or without any amendment which has been adapted at a meeting.

A motion which has been adopted is called a resolution .An expression of opinion by a majority of the members at a meeting is called a resolution. Resolution is the decided conclusion of a motion in any meeting.

In the meeting deferent motions may be moved. They are discussed, thrashed out ,often amended ,seconded or voted and is finally carried they because the resolutions.

So, the record of expression of the opinion or decision of a meeting is what is called the resolution .

The ultimate aim of a meeting is to adopt resolution.

Q-02: Discuss different kinds of resolution ?

Ans. For Q-02 :

The resolution itself has to be strengthened, depending on its gravity. There may be different kinds of resolution for which different notice period and voting requirements will be necessary. The various kinds of resolutions are discussed in the following paragraphs.

1. Ordinary resolution
2. Special resolution
3. Extraordinary resolution
4. Class resolution.

Q-03: Discuss subject to the articles ,Shareholders ordinary resolution ?

Ans. For Q-03 :

Subject to the articles, shareholders, ordinary resolution is sufficient for :

1. Transaction of ordinary business (Consult topic 140 for ordinary business),
2. Fixation of any remuneration,
3. Increase of paid up capital ,
4. Consolidation of shares or subdivision of shares,
5. Conversion of shares in to stock and vice versa,
6. Cancellation of unissued shares,
7. Voluntary winding up where the objects for which it was formed is attained,
8. Voluntary winding up where period of duration of the company has elapsed,
9. Appointment of liquidator in a members voluntary winding up,
10. Registration of unlimited company as limited , and
11. Adjournment of a meeting.

Q-04: Discuss the cases where special resolutions are necessary.

Ans. For Q-04 :

The following are the cases where special resolution is necessary:

1. To change the name of the company [Sec. 11(6)]
2. To change the provisions of the object clause [Sec.12(1)]
3. To alter or add to its articles [Sec.20]
4. To reduce share capital in any way [sec 59 & 70 ]
5. To make reserved capital [Sec.74]
6. To make Directors liability unlimited [Sec.76(1)]
7. To remove a directors from office [Sec.106(1)]
8. To sanction additional remuneration to a managing agent [Sec.119(2)]
9. To appoint inspector to investigate company affairs [sec.207(1)]
10. To remove auditor before expiry of term [210(a)]
11. On court winding up [Sec.214(i)]
12. On voluntary winding up [Sec.286 (b)]
13. To confer authority on the liquidator of a voluntary winding up [Sec.294(1)]
14. On substitution of MA & AA for deed of settlement [Sec.368 (1) ]

Q-05 : What’s are the requirement of a special resolution under The company Act 1994 ?

Ans. For Q-04 :

It is to be passed by majority of not less than three-fourth (i.e.75%) of the members present and vote in person or by proxy. The resolution to be carried as a Special resolution must be clearly and explicitly spelled out in the notice and must be notified at least 21 clear days before the meeting [Sec.87(2)].

It is also state the intention of the company to pass the same as a special resolution. It is to be noted carefully that when the notice clearly states “That the following resolution will be proposed as a special resolution”.

Instead of “To consider and if though fit ,to pass the resolution ,with or without modification “,no amendment can be moved in that special resolution.

Q-06 :Discuss cases where extraordinary resolutions are necessary .

Ans. For Q-06 :

Following Case where extraordinary resolution is necessary.

1. On voluntary resolution because of excess liability [Sec.286(c)],
2. To sanction certain acts of liquidators in case of voluntary winding up.[Sec.308(1)(a)]
3. To Sanction all arrangement between company and creditors, [Sec.311(1)]
4. To dispose of documents an voluntary winding up [Sec.339(1)(6)]

Q-07: How and in which meeting a special Resolution of a Company is passed?

Ans. for Q-07:

Special resolution:

This is passed in a General Meeting by the three-fourth majority of the members present in person or by proxy where proxy is allowed. Notice for which 21 days specifying the-intention to propose the resolution is to be given before the date of the meeting. Special resolutions are necessary for the following purposes:

1. To change the name of the Company;
2. To alter the Memorandum of Association;
3. To alter the Articles of Association;
4. To reduce the share capital;
5. To convert any portion of the capital, uncalled in to reserve capital;
6. To appoint inspectors to investigate the company's own affairs;
7. For winding-up of a Company voluntarily.
8. To pay interest out of capital for raising money to meet expenses of construction work;
9. To convert public limited company to private limited company
   
   
   Q-08 : What are the difference types of resolutions envisaged in the Companies Act 1994? What are the processes of passing a special resolution?
   
   
   Ans. For Q-08 :
   
   
   Different type of resolutions:

1. Ordinary resolution
2.  Special resolution
3. Extra-ordinary resolution.
   
   
   
   
   
   
   
   
   Special resolution:
   
   
   This is passed in a General meeting by the three-fourth majority of the members present in person or by proxy if proxy is allowed, Notice for which specifying the intention to propose the resolution is to be given before 21 days the date of the meeting.
   
   
   Special resolutions arc necessary for the following purposes:
   
   

1. To change the name of the Company;
2. To alter the Memorandum of Association;
3. To alter the Articles of Association;
4. To reduce the share capital;
5. To convert any portion of the capital, uncalled in to reserve capital;
6. To appoint inspectors to investigate the company's own affairs;
7. For winding-up of a Company voluntarily
   
   
   
   
   
   
   Q-09: Differentiate between ordinary resolution, special resolution and extra ordinary resolution.
   
   
   Ans. For Q-09 :
   
   
   Ordinary Resolution:
   This is passed by the majority vole of members present at a general meeting. Such a resolution is passed in the ordinary way and deals with ordinary business, such as passing of accounts, appointing directors, auditors, and declaration of dividends and so on.
   
   
   Special resolution:
   This is passed in a general meeting by the three-fourths majority of the members present in person or by proxy, provided notice for such meeting specifying the intention to propose the resolution is given at least twenty-one days before the date of the meeting. Special resolutions are required –
   
   

1. to change the name of the company with consent of the registrar;
2. to alter the memorandum;
3.  to alter the articles etc.
   
   
   Extra Ordinary resolution:
   
   
   This is passed by such majority vote at a meeting of which 21 days notice has been given. The notice must specify the intention to propose the resolution as an extra-ordinary resolution [Section-87(i)]. Such resolution is necessary when a company is sought to be wound-up voluntarily on the ground of that it cannot continue its business on account of its liabilities and also for a number of other reasons.
   
   
   
   
   
   
   
   
   
   
   
   
   Q-10: Draft a hypothetical resolution of transfer of shares to be adopted by a board of directors.
   
   
   Ans. For Q-10:
   
   
   Minutes of 120th Board Meeting held on 4th March 2007 of ABC Co. Ltd. at its registered office House No. 5, Road No. 16, Dhanmondi, Dhaka.
   
   
   A meeting of the Board of Director of Tanmoy Company limited was held on —at its registered office.
   
   
   Following members of the Board were present:
   
   

1. Mr. X
2. Mr. Y
3. Mr. Z

Mr. X, Chairman of the Board presided over the meeting.

Following business was transacted in the meeting:

Agenda: 1                                     Proposal of transfer of shares of shareholder Mr. T

The board was informed that Mr. T applied for transfer of 100 shares from his name to Mr. K and form 117 and related share certificates were submitted duly for necessary action. After discussion the Board decided as follows:

        

                      "The proposal for transfer of shares is approved".

As there being no other issues to discuss the meeting ended with vote of thanks to and from the Chair.

     

          Mr. L                                                                                                   Mr. X

Company Secretary                                                                 Chairman of the Board of Directors

Q-11: What purposes an extra-ordinary resolution can be used for?

Ans. for Q-11:

Seizure of such books

As- contained in Section-194 the Registrar may make an application to the first class magistrate having jurisdiction for an order for the seizure of such books and papers. The register may consider the application of registrar and order as necessary.

Q-12: What purposes an extra-ordinary resolution can be used for?

Ans. for Q-12 :

Extra-ordinary resolution (Section-87(i)

This is passed by such majority as is required for the passing of a special resolution at a meeting of which 14 days’ notice has been given. The notice must specify the intention to propose the resolution as an extra-ordinary resolution [Section-87(i)]. Such resolution is necessary when a company is sought to be wound-up voluntarily on the ground that it cannot continue its business on account of its liabilities and also for a number of other reasons. (Sec- 87).

Q-13:What do you know about Extra Ordinary and Special Resolutions? Narrate the provisions of the Act for filing these resolutions with the Registrar.

Ans. for Q-13 :

Special resolution:

This is passed in a meeting by a three-fourths majority of the members present in person or by proxy, provided, notices for such a meeting specifying the intention to propose the resolution at least twenty one days before the date of the meeting has been given. Special resolutions are necessary for:

1. to change the name of the company;
2. to alter the memorandum;
3. to alter the articles.
   
   
   Extra Ordinary resolution:
   
   
   This is passed by three-fourth majority vote at general meeting of which 14 days’ notice has been given. The notice must specify the intention to propose the resolution as an extra-ordinary resolution (Section-87(i). Such resolution is necessary when a company is sought to be wound-up voluntarily on the ground that it cannot continue its business on account of its liabilities and also for a number of other reasons. (Sec- 87)
   
   
   Copy of such resolution is to be filed with the register within 15 days from the date of such meeting. (Section-88)
   
   
   Q-14: What are the legal requirement of submitting these resolution to registrar. [Section-88]
   
   
   Ans. for Q-14 :
   
   
   As per Section 88 : Resolution and copies of special and Extra ordinary Resolution :

1. A copy of every special and extraordinary resolution shall, within fifteen days from the passing thereof, be printed or type written and duly certified under the signature of an officer of the company and field with the registrar who shall record the same .[Section 88(1)]
2. Where articles have been registered for the time being in force shall be embodied in or annexed to every copy of the articles issued offer the date of the resolution.
3. Where articles have not been registered, a copy of every special resolution shall be forwarded in print to any member at his request on payment of fifty taka or such less sum as the company may direct.
4. If a company makes default in so filling with the registrar copy of a special or extra-ordinary resolution it shall be liable to a fine no exceeding one hundred taka for every day during which the default contains.
5. If a company makes default in embodying in complying with the provisions of sub-section (2) & (3) ,It shall be liable to a fine not exceeding fifty taka for each copy in respect of which default is made.
6. Every officer of a company, who knowingly and willfully authorize or permit any default by the company in complying with the requirements of this section, shall be liable to the like penalty as in imposed by this section on the company for that default.
   
   
   
   
   
   
   Q-14 :What are the different type of resolutions laid down in the company’s Act,1994 ? Please write down the purposes of the regulations.
   Ans. for Q-14:
   Kind of resolutions
   There are basically three kinds of resolutions, these are:

1. Ordinary resolution;
2. Special resolution;
3. Extra-Ordinary resolution.

Type of resolution	Purpose of resolution
1)   Ordinary resolution	Passing of accounts Appointment of Directors Declaration Dividend
2)   Special resolution	Changing the name of the company Alteration of M/A,A/A Reduction of capital Winding –up of company voluntarily
3)   Extra-Ordinary resolution	Winding –up of company voluntarily