Requisitioned EGM rights upheld as civil injunction and legality objections to proposed resolutions were rejected.

A requisitioned EGM could not be restrained where the shareholders' requisition satisfied Section 100's numerical and procedural requirements; "valid requisition" was confined to that compliance, not to the substantive merits of the proposed resolutions, and Section 430 barred a civil suit that would interfere with the statutory scheme and corporate democracy. The proposed resolutions were also not illegal: prior broadcasting permission was not shown to be a condition precedent to convening the meeting, the Companies Act allowed post-appointment compliance for directors, shareholder initiative to propose independent directors was not excluded, Regulation 17 did not forbid the proposed board reconstitution, and a claimed executive vacancy did not invalidate the resolutions because the statute provided for filling the vacancy thereafter. The restraint was set aside and the requisitioned resolutions were upheld.

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Issues: (i) Whether a civil court could restrain shareholders from convening or holding a requisitioned extraordinary general meeting and whether the injunction granted was barred by the Companies Act, 2013; (ii) Whether the proposed resolutions in the requisition were illegal or incapable of lawful implementation by reason of the Companies Act, 2013, the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, and the Policy Guidelines for Uplinking of Television Channels issued by the Ministry of Information & Broadcasting.

Issue (i): Whether a civil court could restrain shareholders from convening or holding a requisitioned extraordinary general meeting and whether the injunction granted was barred by the Companies Act, 2013.

Analysis: The requisition was held to satisfy the numerical and procedural requirements of Section 100, and the expression "valid requisition" was construed as referring to compliance with those requirements and not to the substantive legality of the objects proposed for consideration. The decision in LIC v. Escorts was treated as establishing that shareholders cannot be restrained from calling a meeting and that the reasons for resolutions are not subject to judicial review. The Court further held that Section 430 barred the civil suit to the extent it sought to prevent a matter that fell within the statutory framework governing requisitioned meetings, and that the injunction would cut across the statutory scheme and corporate democracy.

Conclusion: The injunction restraining the appellants from calling and holding the extraordinary general meeting was unsustainable and was set aside.

Issue (ii): Whether the proposed resolutions in the requisition were illegal or incapable of lawful implementation by reason of the Companies Act, 2013, the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, and the Policy Guidelines for Uplinking of Television Channels issued by the Ministry of Information & Broadcasting.

Analysis: The Court held that prior permission under the broadcasting guidelines was not shown to be a precondition that had to be obtained before the general meeting, and that the Act itself contemplated post-appointment compliance for directors through the statutory consent and filing requirements. It was further held that shareholders could propose the appointment of independent directors under the statutory scheme, that the nomination and remuneration committee provisions did not exclude shareholder initiative in the manner contended, and that Regulation 17 did not prohibit a board from being reconstituted in the manner proposed. The Court also held that the alleged vacancy in an executive position did not render the resolutions unlawful because the statute provided for filling such vacancy after it arose.

Conclusion: The proposed resolutions were not illegal and were capable of being lawfully implemented.

Final Conclusion: The appeal succeeded in full, the restraint on the shareholders' meeting was removed, and the objections to the requisitioned resolutions were rejected.

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