Veto Rights Relating To Quorum And Voting On Resolutions - Whether Enforceable Under The Indian Companies Act, 1956?

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Veto Rights Relating To Quorum And Voting On Resolutions - Whether Enforceable Under The Indian Companies Act, 1956?

Ambit

It is quite common to observe in most of the Joint Venture Agreements ('JVA') that certain special rights or (veto rights as these are commonly known) retained by the JV parties qua Board meetings and General meetings. These rights are invariably incorporated in the Articles of Association (the 'Articles') of the Joint Venture Company. Generally these rights provides for the presence and / or affirmative vote of the JV parties to pass a resolution or to take a decision. The basic fabric of the Indian Companies Act, 1956 ('the Act') is democracy. In Board meeting or General meeting the principles of corporate democracy is s...

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