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Tamilnadu Samacheer Kalvi 12th Commerce Solutions Chapter 28 Company Secretary
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Samacheer Kalvi 12th Commerce Company Secretary Textbook Exercise Questions and Answers
I. Choose the Correct Answer
Question 1.
Mention the status of a Company Secretaiy in a company _______
(a) A member
(b) A director
(c) An independent
(d) An employee contractor
Answer:
(d) An employee contractor
Question 2.
Who can become a secretary for a company?
(a) Individual person
(b) Partnership firm
(c) Co-operative societies
(d) Trade unions
Answer:
(a) Individual person
Question 3.
Which meeting will be held only once in the life time of the company?
(a) Statutory
(b) Annual General
(c) Extra-ordinary
(d) Class General
Answer:
(a) Statutory
Question 4.
Board Meetings to be conducted minimum _______ times in a year.
(a) 2
(b) 3
(c) 4
(d) 5
Answer:
(c) 4
Question 5.
Who is not entitled to speak at the annual general meeting of the company?
(a) Auditor
(b) Shareholder
(c) Proxy
(d) Directors
Answer:
(c) Proxy
Question 6.
Mention the company which need not convene the Statutory Meeting.
(a) Widely held public
(b) Private Limited
(c) Public Limited
(d) Guarantee having a share capital
Answer:
(b) Private Limited
Question 7.
From the date of its incorporation the First Annual General Meeting is to be conducted within _______ months.
(a) Twelve
(b) Fifteen
(c) Eighteen
(d) Twenty one
Answer:
(b) Fifteen
Question 8.
What percentage of shareholders is needed to pass special resolution?
(a) It must be unanimous
(b) Not less than 90%
(c) Not less than 75%
(d) More than 50%
Answer:
(c) Not less than 75%
Question 9.
A special resolution must be filed with the Registrar within _______
(a) 7 days
(b) 14 days
(c) 30 days
(d) 60 days
Answer:
(c) 30 days
Question 10.
A special resolution is required to _______
(a) redeem the debentures
(b) declare dividend
(c) appoint directors
(d) appoint auditor
Answer:
(d) appoint auditor
II. Very Short Answer Questions
Question 1.
Who is a Secretary?
Answer:
The person who is responsible for the general performance of an organization is called company secretary.
Question 2.
Define Meeting.
Answer:
A company meeting must be convened and held in perfect compliance with the various provisions of the Act and the rules framed thereunder.
Question 3.
What is Resolution?
Answer:
As per the Companies Act 2013, for taking any decision or executing any transaction, the consent of the shareholders, the Board of Directors and other specified is required. The decisions taken at a meeting are called resolutions
Question 4.
Write short note on ‘Proxy’.
Answer:
‘Proxy’ means a person being the representative of a shareholder at the meeting of the company. Proxy can be present at the meeting but he cannot vote.
Question 5.
What is Vote?
Answer:
The word ‘Vote’ originated from Latin word ‘Votum’ indicating one’s wishes or desire. By casting his vote one formally declares his opinion or wish in favour of or against a proposal or a candidate to be elected for an office.
III. Short Answer Questions
Question 1.
What is Special Resolution?
Answer:
A special resolution is the one which is passed by not less than 75% of majority. The number of votes, cast in favour of the resolution should be three times the number of votes cast against it.
Question 2.
What do you mean by Statutory Meeting?
Answer:
According to Companies Act, every public company, should hold a meeting of the shareholders within 6 months but not earlier than one month from the date of commencement of business of the company. This is the first general meeting of the public company, which is called the Statutory Meeting. This meeting is conducted only once in the lifetime of the company.
Question 3.
What do you understand by ‘Poll’?
Answer:
Poll means tendering or offering vote by ballot to a specially appointed officer, called the polling officer. Under the Companies Act, poll means exercising voting right in proportion to shareholder’s contribution to the paid-up capital of a limited company having a share capital.
Question 4.
Give any three cases in which an ordinary resolution need to be passed.
Answer:
An ordinary resolution is one which can be passed by a simple majority, i.e. if the members of votes cast by members, entitled to vote in favour of the resolution is more than the votes cast against the resolution.
Ordinary Resolution is required for the following matters:
- To change or rectify the name of the company
- To alter the share capital of the company
- To redeem the debentures
Question 5.
What resolution requires special notice?
Answer:
There are certain matters specified in the Companies Act, 2013 which may be discussed at a general meeting only if a special notice is given at least 14 days before the meeting. The intention to propose any resolution must be notified to the company. The following matters require special notice before they are discussed in the meeting:-
- To appoint an auditor, a person other than a retiring auditor
- To provide expressly that a retiring Auditor shall not be reappointed
- To remove a director before the expiry of his period of office
- To appoint a director in the place of a director so removed
IV. Long Answer Questions
Question 1.
Elaborate the functions of the Company Secretary.
Answer:
The functions of the Company Secretary may be divided into two types. They are:
- Statutory functions
- Non-Statutory functions
Statutory Functions: As the principal officer of the company, the secretary must observe all the legal formalities in respect of the provisions of the Companies Act and other laws, for the activities of the company.
According to Companies Act 2013:
- To sign document and proceedings requiring authentication by the company
- To maintain share registers and register of directors and of contracts.
- TO give notice to register for increase in the share capital
- To send notice of general meeting to every member of the company
- To prepare minutes of every general meeting and board meeting within 30 days
Non-Statutory Functions: The secretary has to discharge non-statutory functions in relation to directors, shareholders and office and staff.
Functions in Relation to Directors: A company secretary acts under the full control of the board of directors and carry out the instructions of the directors.
The secretary will arrange board meetings issuing notice, and preparing agenda of meetings, recording the attendance and minutes of meetings.
Functions in Relation to Shareholders: The company secretary must serve in the best interests of the shareholders.
He has to arrange the issue of allotment letters, call letters, letters of regret, share certificates, and share warrants to Shareholders.
Functions in Relation to Office and Staff: The secretary is responsible for smooth functioning of the office work. He exercises an overall supervision, control and co-ordination of all clerical activities in the office.
Question 2.
Discuss the liabilities of Company Secretary.
Answer:
As an officer, a company secretary has extensive duties and liabilities. The success of the company depends upon his efficient functions and capacity to perform.
Liabilities:
- It is duty of the secretary to arrange for Board meetings and shareholders annual general meeting.
- The secretary controls and supervises the day-to-day activities of the company.
- Also he should prepare details for issue of allotment letters, share certificates and dividend warrants.
- To arrange for filing statement in lieu of prospectus.
- The secretary should send notice of general meeting to every member of the company.
- Being a principal officer, a company secretary can sign contracts and proceedings of company meetings.
- (He is liable to maintain share registers and register of directors and contracts.
- To prepare minutes of every general meeting and Board meetings within 30 days.
Question 3.
Briefly state different types of company meetings.
Answer:
A Company can convene meetings to discuss the performance of the company and also to take decisions. Under the companies Act 2013, company meetings may be classified as below:
(i) Meetings of Shareholders: The meeting held for the shareholders of the company is shareholders meeting. This may be divided as follows: .
(a) Statutory Meeting: Every public company should hold a meeting of the shareholders within 6 months but not earlier than one month from the commencement of the business.
(b) Annual General Meeting: Every year a meeting is held to transact the ordinary business of the company. It is called annual general meeting.
(c) Extra-Ordinary General Meeting: If any meeting conducted in between two annual general meetings to deal with some urgent or special or extraordinary nature of business is called as extra-ordinary general meeting.
(ii) Meeting of the Board of Directors: To decide policy matters of the company, the board of directors meet frequently, which is known as meeting of the board of directors.
(a) Board Meetings: Meetings of the directors are called board meetings. It may be convened to discuss the business and take formal decisions.
(b) Committee Meetings: Every listed company and every other public company having a capital of ?10 crore is required to have audit committee. The meeting held by this committee is known as committee meetings.
(iii) Special Meeting:
(a) Class Meeting: Meetings held by a particular class of share or debenture holders is
known as Special or Class meeting, e.g. preference shareholders or debenture holders meeting. .
(b) Meetings of the Creditors: These are not meetings of a company. Meetings held with the creditors to discuss any crisis about the financial matters.
Question 4.
Describe the different types of resolutions which company may pass with suitable matters required for each type of resolution.
Answer:
A motion, with or without the amendments which is put to vote at a meeting and passed with the required quorum becomes resolution. Resolution may be classified into three types. They are: Ordinary resolution, Special resolution and resolution requiring special notice.
(i) Ordinary Resolution: An ordinary resolution is one which can be passed by a simple majority.
Ordinary Resolution is required for the following matters:
(a) To change or rectify the name of the company
(b) To alter the share capital of the company
(c) To redeem the debentures
(d) To declare the dividends
(e) To appoint the directors
(ii) Special Resolution: A special resolution is the one which is passed by not less than 75% of majority.
Special Resolution is required for the following matters:
(a) To change the registered office of the company
(b) To alter the Articles of Association
(c) To commence any new business
(d) To appoint the auditor for the company
(iii) Resolution requiring Special Notice: There are certain matters specified in the Companies Act, 2013 which may be discussed at a general meeting only if a special notice is given at least 14 days before the meeting.
The following matters require special notice:
(a) To remove a director before the expiry of his period
(b) To appoint a director in the place of a director so removed
Question 5.
Explain different types of open and secret types of voting.
Answer:
The word ‘Vote’ originated from Latin word ‘Votum’ indicating one’s wishes or desire. He can vote formally by expressing his opinion or wish in favour or against a proposal.
Types of Voting: There are two methods of voting viz, open and secret procedures.
(i) Open Voting: This type of voting has no secrecy as all the members assembled can see – voting. There are two types of open voting namely voice voting and voting by show of hands.
(a) By Voice: Voice voting is a popular type of voting in which the chairman allows the members to raise their voice in favour or against an issue ‘Yes’ for approval and ‘No’ for rejection.
(b) By Show of Hands: Under this method, the chairman requests the members to raise their hands for the proposal.
(ii) Secret Procedure: Secret procedure is adopted to decide certain vital issues. It may be of two types:
(a) By Ballot: Under this system, ballot paper bearing serial number is given to the members to record their opinion by marking with the symbol.
(b) Postal Ballot: Big companies or big associations having members scattered all over . the country follow this method of voting. Under this method, the members or voters fill
in the ballot papers sent by the company and return them in sealed covers.
Samacheer Kalvi 12th Commerce Company Secretary Additional Questions and Answers
I. Choose the Correct Answer
Question 1.
A statutory meeting can be held within _________ months.
(a) 10
(b) 5
(c) 6
(d) 3
Answer:
(c) 6
Question 2.
The word ‘Vote’ originated from the Latin word _________ indicating one’s wishes or desires.
(a) Votum
(b) _______
(c) _______
(d) _______
Answer:
(a) Votum
Question 3.
An ordinary resolution is one which can be passed by a _________ majority.
(a) simple
(b) special
(c) high
(d) low
Answer:
(a) simple
II. Very Short Answer Questions
Question 1.
Name the various kinds of meetings of shareholders.
Answer:
The meetings of the shareholders can be divided into three kinds: They are
- Statutory meeting
- Annual general meeting
- Extra-ordinary general meeting
Question 2.
Write a note on class meeting.
Answer:
Meetings, which are held by a particular class of share or debenture holders is known as class meeting, e.g. preference shareholders meetings or debenture holders meeting.
III. Short Answer Questions
Question 1.
How the company secretary is appointed?
Answer:
As per section 2 (247, 203, 204) of companies Act 2013, the provisions are given for appointment of company secretary. Only an individual who is a member of Institute of Company Secretaries of India can be „ appointed as a company secretary. There are two methods of appointment of company secretary. They are given below:
- By the Promoters: The first secretary of a company is appointed by the promoters at pre-incorporation stage.
- By the First board of Directors: After the company has been registered, the first board of directors appoints the secretary at the first board meeting.
Case study
Case 1:
Mr R, as the secretary of the Muraliviki Co., signed a letter to its bank, forwarding a ‘resolution’ of the board of directors. The resolution named three directors and instructed the bank to pay cheques signed by any two of them and countersigned by the secretary. Specimen signatures were attached. The instruction was entirely in accordance with the company’s memorandum and articles. However, there had never been any proper appointment of directors or a secretary by the company. Those who had formed the company had assumed their roles. Following the letter, the bank had honoured cheques in accordance with the instructions contained in the letter. The question was, whether, the company was bound by the cheques. Comment.
Answer:
Yes, the company was bound liable for the cheques given.
Because, the company has instructed the bank to pay cheques signed by any two of the director and countersigned by the Secretary. So the bank honoured the cheques issued by the company.
Case 2:
A contract between Muthumani Ltd and Mr. V, one of its director is referred to a general meeting for its approval. At the meeting, Mr. V voted for the resolution and all others against it. But as V held majority of shares and was entitled to majority of votes, the resolution was passed. Is the contract binding on the company?
Answer:
No. The contract is not binding the company. Because the director Mr.V is having majority of shares. So the resolution is passed by Mr.V, by having majority of votes.
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