Section 25 of the Companies Act, 2013
Section 25 of the Companies Act, 2013
Title: Power of members to requisition circulation of resolution
This section provides the right to members of a company to request the company to circulate a resolution or a statement to other members before a general meeting.
🔹 Full Text Summary of Section 25:
(1) A company shall, on a requisition made by such number of members as specified below and in compliance with prescribed conditions, circulate to members:
Any resolution proposed to be moved at a meeting, or
Any statement related to the proposed resolution or any other business to be dealt with at the meeting.
📌 Who can make the requisition?
In case of a company having share capital:
Members holding at least 1/10th (10%) of the total voting power.
In case of a company not having share capital:
At least 1/10th of the total number of members.
(2) Requisition must be:
Submitted in writing, signed by the requisitionists, and
Deposited at the registered office of the company not less than 6 weeks before the meeting (if resolution),
Or at least 2 weeks before the meeting (if statement only).
(3) The company must circulate the resolution or statement:
To all members entitled to receive notice of the meeting, and
Do so in the same manner and time as the notice of the meeting.
(4) If the company does not comply, the Tribunal may, on an application made by the requisitionists, direct that the resolution or statement be circulated at the company’s cost.
(5) The company is not bound to circulate the statement if:
The court or Tribunal is satisfied that the rights are being abused, or
The statement contains defamatory, irrelevant, or frivolous material.
✅ Purpose of Section 25:
To empower members to:
Raise issues or propose resolutions for consideration.
Promote shareholder democracy and active participation.
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