The Companies Act: What are Proxies?

Section.176 of the Companies Act, 1956, provides for proxies. A member who is entitled to vote in a company meeting has options on how to vote. He can vote himself in person or by proxy. A proxy is a process by which a person is appointed and authorized to represent and vote on behalf of another person at a company meeting.

The person who is appointed by the process of proxy is also known as proxy. By law, a proxy may or may not be an associate of the corporation and he shall not act contrary to the directions of the appointer or the principal. He shall not have any say in the company meeting.

The Companies Act: Few Mandatory Conditions Related to Proxy

The following are some terms and conditions related to proxy:

Proxy in Writing: The appointment of a proxy shall be in a written form and it should bear the signatures of the appointer or his lawyer who is authorized by him.

Deposition Time for Proxy: A proxy is considered valid only if deposition time is 48 hours prior to the meeting.

Proxy is Revocable:  A proxy is an authorized agent of the person who appoints him. The principal may withdraw the authority before the agent has actually exercised the power. However, revocation shall be done before the proxy has voted.

Notice Calling Meeting:  It should be mentioned that in every notice calling meeting of a company, a member can appoint a person who is either a member or non-member of the company as a proxy. In case of failure to do so, every officer at fault may be punished with a fine of Rs.500.