Gem Quartzite Ltd., a top 100 listed company, is having 1,20,000 equity shares of face value ₹100, fully paid-up. The Annual General Meeting of the company was convened on 31 st August, 2023 after due notice. Fifty membe

Appointment of Independent Director on the Board of a listed company requires a special resolution to be passed under Regulation 25(2A) of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015. In this case, the votes cast in favour of the resolution is only 60,000 votes as against the requirement of at least 75,000 votes to pass a special resolution. Hence, the special resolution is not passed. However, with effect from 14 th November, 2022, proviso to Regulation 25(2A) of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 states that where the special resolution to appoint an independent director fails to get 3/4th majority of members present and voting, if- The votes cast in favour of the resolution exceed the votes cast against the resolution and The votes cast by the public shareholders in favour of the resolution is more than the votes cast against the resolution the independent director is deemed to be appointed. In this case, the votes cast in favour of the resolution by public shareholders is only 10,000 votes whereas the votes cast against the appointment by public shareholders is 30,000 votes. Hence, the requisite condition fails. Hence, the decision of the Chairman to declare that Shubudhi is appointed as Independent Director is not correct. The independent director has not been appointed as per the provisions of the aforesaid regulations.