Quorum refers to the minimum number of members required to be present at a meeting to make the proceedings of that meeting valid. Section 103 of the Companies Act, 2013 specifies the quorum requirements for general meetings of a company. Without quorum, any decision taken in the meeting is not legally binding.
This provision ensures that significant decisions are not made by a very small or unrepresentative number of shareholders.
What is Quorum as per Section 103?
Quorum is the minimum number of eligible members (shareholders) who must be physically present (or as per provisions, virtually present) at the start of the meeting for it to commence and conduct business legally.
Minimum Quorum Requirements
As per Section 103(1) of the Companies Act, 2013, the quorum for a general meeting shall be:
🔹 For a Private Company:
2 members personally present shall be the quorum, unless the Articles of Association provide otherwise.
🔹 For a Public Company:
Quorum depends on the number of members on the date of the meeting:
Number of Members on Meeting Date 👥 Quorum Required Up to 1000 5 members 1001 to 5000 15 members More than 5000 30 members
🔹 When Should Quorum Be Checked?
(i) Quorum must be present at the beginning of the meeting.
(ii) It is not necessary for quorum to be maintained throughout the meeting.
(iii) If the quorum is not present within 30 minutes from the scheduled time, the meeting is either adjourned or cancelled, depending on the scenario.
🔢 How to Calculate Quorum?
(i) Only members personally present (physically or via virtual means, if allowed) are considered for quorum.
(ii) Proxies are not counted for quorum purposes.
(iii) In the case of a body corporate, a duly authorized representative is considered as a member personally present.
🔹 What Happens if Quorum is Not Present?
✅ Same Day Meeting:
If the meeting is called on requisition of members under Section 100, and quorum is not present within 30 minutes, the meeting shall stand cancelled.
✅Otherwise:
(i) The meeting stands adjourned to the same day, time, and place in the next week, or as determined by the Board.
(ii) No quorum is required in the adjourned meeting unless the Articles of Association provide otherwise.
Other Provisions and Notes
(i) Articles of Association (AOA) may specify a higher quorum.
(ii) The Chairman of the meeting must ensure quorum is present before starting.
(iii) If quorum is found lacking during the meeting, the proceedings up to that point are valid.
(iv) In case of a joint shareholding, only one member (or representative) is counted.