Restraint on shareholders of Zee Entertainment Enterprises ...

Companies Law

March 28, 2022

Restraint on shareholders of Zee Entertainment Enterprises Limited from calling for and holding an Extra Ordinary General Meeting - The procedure for appointment of Independent Directors - The power given to shareholders of a Company by Section 160 and more importantly, the proviso thereto, cannot go unnoticed. In the teeth of the aforesaid provision, we cannot appreciate how the Ld. Single Judge agreed “on all counts” with Zee’s submission that “In the scheme of the Companies Act, shareholders do not get to choose individual independent directors.” - Section 160 does not make any distinction whatsoever between an Independent Director or otherwise. On a plain reading of Section 160, a shareholder of a Company clearly has the right to propose the appointment of an Independent Director. - Zee’s submission cannot be accepeted by defeating corporate democracy and ignoring the safeguards provided to shareholders under Section 160 and 169 of the Act. - HC

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