Q. (11) Provisions pertaining to proxy.

Ans:Proxy (Section 176)

Meaning A proxy is a person, being a representative of a shareholder at a meeting of a company
who may be described as his agent to carry out which the shareholder has himself decided upon.
Appointment of a proxy The appointment of a proxy must be made by a written instrument signed
by the appointer or his duly authorized attorney [Section 176(5)].
The instrument of proxy has to be in the prescribed form set out in Schedule IX. Section 176(6)
provides that an instrument appointing a proxy, if in any of the forms set out in Schedule IX, shall not
be questioned on the ground that it fails to comply with any special requirements specified for such
instrument by the Articles.
The instrument of proxy must be deposited with the company forty-eight hours before the meeting. If
a period longer than forty-eight hours is specified, it shall have effect as if a period of forty-eight
hours had been specified [Section 176(3)].
According to the proviso to sub-section (1) of section 176, unless articles otherwise provide:
(1) a member of a company having no share capital cannot appoint a proxy;
(2) a member of a private company cannot appoint more than one proxy to attend on the same
occasion;
(3) a proxy shall not be entitled to vote except on a poll.
It may be noted that for each meeting a separate proxy is required.
Notice of the meeting to mention right of a member to appoint proxy [Section 176(2)] - In every
notice calling a meeting of a company which has a share capital or the articles of which permit voting
by proxy, there must appear with reasonable prominence:
(1) that a member entitled to attend and vote is entitled to appoint a proxy or proxies;
(2) that a proxy need not be a member.
If default is made in complying with section 176(2) as regards any meeting, every officer of the
company who is in default shall be punishable with fine which may extend to five thousands
rupees.
Rights of proxy According to proviso to sub-section (1) of section 176, unless articles
otherwise provide, a proxy cannot vote except on a poll. But the articles may provide otherwise,
say permitting a proxy to vote on a show of hands also.
A proxy being an agent has to act according to the wishes of the shareholder; he cannot do
otherwise.
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A proxy shall not have any right to speak at the meeting [Section 176(1)]
Proxy by joint holders In the case of joint shareholders, a proxy form to be valid must be
executed by all the joint holders unless the authority to execute proxy form has been conferred
upon any one or more of them. However, Reg.57 of Table A provides that proxy tendered by the
joint holder named first shall be valid.
Inspection of proxy forms A member entitled to vote at a meeting of the meeting of the
company or any resolution to be moved thereat can inspect the proxy forms deposited with the
company provided he had given at least three days notice in writing to the company of his
intention to so inspect. Inspection can, however, be done during the period beginning twenty-four
hours before the commencement of meeting and ending with the conclusion of the meeting
[Section 176(7)].
Revocation of proxy Subject to articles, proxy may be revoked unless made irrevocable for
valuable consideration.
If shareholder, after appointing a proxy himself attends the meeting, he can vote in person; the
proxy stands revoked.
The right of the shareholder to vote in person is paramount to the right of the proxy. The presence
of the shareholder does not avoid the instrument of proxy; but if he votes before his proxy has
voted for him, he impliedly revokes the proxy.
The death of a shareholder who has appointed a proxy, in the absence of provision in the articles,
revokes the authority of proxy, but articles usually provide that a proxy shall be valid
notwithstanding the previous death or insanity of, or revocation by, the person giving it, unless the
company has received notice of such death, insanity ensure that resolutions apparently validly
passed at an apparently valid meeting were indeed validly passed.
Invitation to members prohibited Section 176(4) prohibits any invitation to appoint as proxy
any person or one of a number of persons specified in the invitation which may be issued at the
companys expense to any member entitled to have a notice of the meeting and to vote thereat by
proxy. Every officer of the company who knowingly issues invitation as aforesaid or willfully
authorizes or permits the issue of the invitation shall be liable to a fine which may extend to ten
thousand rupees. This, however, does not prevent an officer of the company issuing a form of
proxy or a list of persons willing to act as proxy at the request of a member received in writing
provided that the form of proxy or list is available on request in writing to every member entitled
to vote at the meeting and not merely to a selected few.
Proxy for adjourned meeting Proxy deposited in due time before the original meeting is also
valid for the adjourned meeting. Proxy may, however, be appointed for the adjourned meeting
though member had himself attended the original meeting.
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