The Articles of Association of Vraj Ltd. inter alia includes a provision "For obtaining a loan of more than rupees five crore from any bank, special resolution is necessary". Due to business emergencies, on one occasion

As per section 114 (2) of the Companies Act, 2013 (the Companies Act), a resolution shall be a special resolution when- (a) the intention to propose the resolution as a special resolution has been duly specified in the notice calling the general meeting or other intimation given to the members of the resolution; (b) the notice required under the Act has been duly given; and (c) the votes cast in favour of the resolution, whether on a show of hands, or electronically or on a poll, as the case may be, by members who, being entitled so to do, vote in person or by proxy or by postal ballot, are required to be not less than three times the number of the votes, if any, cast against the resolution by members so entitled and voting. Assuming that the company was not required to pass any special resolution under section 180(1)(c) of the Act, for availing the said loan, we can say that the Articles of Association (AoA) of the Company is entrenched to the effect of providing a condition (stricter than what the Act stipulates) for availing the loan and accordingly, any action taken by the Company outside the stipulated requirements of the AoA shall be considered to be ultra vires the AoA. Such a stipulation even not being in contradiction of the Companies Act, 2013 will also prevail and be applicable pursuant to Sec 6 of the Act. Therefore, the act of the Company is not valid.