Paragraph 16 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Paragraph 16 of SS-2 is the Standard's guide to deciding business by post and electronic ballot instead of at a meeting. It says which companies and which items are covered, who in the company does what, what the notice and the ballot form must contain, when a form is invalid and when results are due.
The version explained here is SS-2, as revised, effective from 1 April 2024 (approved by the Central Government under section 118(10)). ICSI may revise the Standards, so check the current version on icsi.edu. If a later change in the Companies Act makes any part of SS-2 inconsistent, the Act prevails. Drafting a postal ballot notice is a task for board resolution and legal documents support.
Every company with more than two hundred members transacts the reserved items only by postal ballot, unless it is a company required to provide e-voting, which may take them at a general meeting (2024 change). Ordinary Business is never transacted by postal ballot. The Board approves the notice and appoints one scrutiniser who is not an employee. The scrutiniser reports within seven days of the last date for receiving forms, and a form received after thirty days from dispatch is not valid.
Paragraph 16.1: who and what
Every company, except one with two hundred members or fewer, transacts the prescribed items of business only by postal ballot rather than at a general meeting. Since 2024 the Standard adds that a company that must provide e-voting can instead take those items at a general meeting. The Board may also put any other special business to postal ballot, except business on which Directors or Auditors have a right to be heard at the meeting. Ordinary Business is never taken by postal ballot.
The reserved items fall into a few types. In TaxClue's grouping they are:
| Type | Items in the Annexure |
|---|---|
| Constitutional changes | Alteration of the objects clause; changes to Articles that make a company private; moving the registered office outside the local limits of a city, town or village |
| Capital and securities | Change in objects of money raised by prospectus while funds remain unutilised; shares with differential rights; variation of class rights; buy-back |
| Assets and lending | Sale of the whole or substantially the whole of an undertaking; loans, guarantees or security above the specified limit |
| Directors | Appointment of a director elected by small shareholders |
| Other | Any other resolution prescribed under applicable law, rules or regulations |
The current rule lists ten items and is stated in Rule 22 of the Management and Administration Rules. It describes the director item as the election of a director and also allows e-voting companies to hold those items at a meeting; read the live rule for the current list, which prevails over the Standard's Annexure if they differ. The Act's section is in section 110 on postal ballot.
Paragraph 16.2: e-voting
Companies required to provide e-voting (see paragraph 7 of SS-2) provide it for postal ballot items too; a Nidhi is exempt.
Paragraph 16.3: Board approval
The Board must:
- identify the business for postal ballot;
- approve the notice with resolutions and explanatory statement;
- authorise the Company Secretary (or a Director if there is none) to run the process, sign and send the notice;
- appoint one scrutiniser, who may be a Company Secretary, Chartered Accountant or Cost Accountant in practice, an Advocate or another person of repute, but not an officer or employee of the company, with prior consent noted by the Board;
- appoint an Agency for e-voting; and
- decide the cut-off date. Only members on that date vote and receive the notice and forms.
Paragraph 16.4: notice and advertisement
Notice goes in writing to every member by registered post, speed post, courier, e-mail or other electronic means at the registered address, with the postal ballot form and instructions. It also goes to Directors, Auditors, the Secretarial Auditor and Debenture Trustees. It is placed on the website until the last date for receipt. It must state where and when results will be announced, the website link for results and the mode of declaration. Where e-voting is provided, the notice describes the procedure, the start and end times, says voting is not allowed beyond that, gives the grievance contact, and states that a member who votes both by post and electronically has the postal vote treated as invalid. Each item is a resolution with an explanatory statement.
An advertisement appears at least once in a vernacular newspaper and once in an English newspaper with wide circulation in the district, announcing dispatch. It covers: business by postal ballot including electronic voting; completion of dispatch; start and end of voting; that a form received after thirty days from dispatch is not valid; that members without a form may ask for a duplicate; contact details; and the date, time and venue of the result with the website link.
Paragraph 16.5: the ballot form
- A postage-prepaid reply envelope addressed to the scrutiniser goes with it; one form may cover several items.
- The form carries instructions on filling in assent or dissent and returning it, and may list grounds of rejection and the duplicate procedure.
- The form is invalid if, for example, it is not the company's own, is unsigned or the signature does not match, assent or dissent is unclear, voting rights are frozen, it arrives late, the member is in arrears of calls, or the member altered the resolution or imposed a condition.
- A form that is complete and in time but undated is valid.
Paragraph 16.6 to 16.9: results, custody and later changes
| Para | Requirement |
|---|---|
| 16.6.1 | The scrutiniser reports within seven days from the last date for receipt of forms to the Chairman or an authorised person, who countersigns and declares the result on the date, time and venue stated in the notice, with votes for and against, invalid votes and whether carried |
| 16.6.2 | Result and report are displayed at least three days at the registered, head and corporate offices (if elsewhere) and on the website, if any |
| 16.6.3 | A resolution passed by the requisite majority is deemed passed on the last date fixed for receipt of completed forms or e-voting |
| 16.7 | Forms, papers, register and report are kept with the Company Secretary or another authorised person |
| 16.8 | A postal ballot resolution is rescinded only by a later postal ballot resolution, or at a general meeting of a company required to provide e-voting (2024 change) |
| 16.9 | No amendment or modification can be made to a resolution circulated for postal ballot |
What changed in 2024
- 16.1: a reserved item may now be taken at a general meeting by a company required to provide e-voting, following the Companies (Amendment) Act, 2017.
- 16.8: the same change lets a postal ballot resolution be rescinded at a general meeting of such a company.
- The Annexure heading now reads "Paragraph 16.1" instead of "Para 16.1". See the revised SS-1 and SS-2 article for the full list.
A worked example
Vertex Alloys Limited, with 850 members, plans a buy-back. The Board approves the notice, appoints a Company Secretary in Practice with her consent noted, fixes a cut-off date and authorises dispatch. A member who both posts a form and votes electronically has the postal vote ignored, and forms arriving after thirty days are not counted. The scrutiniser reports within seven days, the Chairman declares the result at the venue in the notice, and the resolution is deemed passed on the last date for receipt.
Need help with a postal ballot?
A postal ballot has more documents than a meeting and shorter margins for error. TaxClue's board resolution and legal documents team can prepare the notice, advertisement text, ballot form and scrutiniser's report.
Key takeaways
- Companies with more than two hundred members use postal ballot for the reserved items, unless they can take them at a meeting through e-voting.
- Ordinary Business never goes by postal ballot.
- The Board approves the notice and appoints one non-employee scrutiniser.
- A form received after thirty days from dispatch is not valid.
- The scrutiniser reports in seven days; the resolution is deemed passed on the last date for receipt.
Read next
- Paragraphs 9 to 15 of SS-2: poll and adjournment
- Paragraph 8 of SS-2: e-voting
- Notice of postal ballot under section 110 and rule 22
- Decisions without a meeting: circulation and postal ballot
Disclaimer: Based on the Secretarial Standards issued by the Institute of Company Secretaries of India (SS-1 and SS-2 as revised effective 1 April 2024; SS-3 effective 1 January 2018; SS-4 effective 1 October 2018), as consulted on 3 October 2026. ICSI revises the Standards from time to time; check the current versions on icsi.edu and the Companies Act provisions referred to. This article is general information, not legal advice; check the official text before acting.