Question

Life Insurance Corporation of India holds twenty five percent of subscribed capital of XYZ Ltd. The appointment of statutory auditor in XYZ Ltd. Would be by _________________.

• A. Ordinary resolution
• B. Special resolution
• C. Both (A) & (B)
• D. None of the above

Answer 1

The correct option is B Special resolution

Life Insurance Corporation is owned by the Government of India.

Life Insurance Corporation holds 25% in XYZ Ltd.; which means government of India has interest in the said company.

Due to this reason, as per the companies act, a special resolution is required for appointment of statutory auditor i.e resolution is to be passed by majority of not less than two third of votes.