The Interplay Between Articles Of Association And Shareholders' Agreements In Corporate Voting Rights: A Legal Analysis In The Indian Context
- IJLLR Journal
- Jan 18
- 1 min read
Zeenya Jestin, Jindal Global Law School
ABSTRACT
This research paper examines the relationship between Articles of Association (AOA) and Shareholders' Agreements (SHA) in the context of corporate voting rights in India. It analyzes the legal framework governing these documents, focusing on key sections of the Companies Act, 2013 and the Indian Contract Act, 1872. The study explores landmark cases such as V.B. Rangaraj v. V.B. Gopalakrishnan and Tata Consultancy Services Ltd. v. Cyrus Investments, which have shaped the legal landscape.
The research highlights the traditional supremacy of the AOA while acknowledging the growing importance of SHAs in modern corporate governance. It discusses the challenges in reconciling conflicting provisions and the evolving approach of Indian courts in interpreting and enforcing SHA clauses not incorporated in the AOA. Recent trends are examined, including the use of entrenchment provisions and increased transparency requirements. The paper offers recommendations for harmonizing AOAs and SHAs, emphasizing careful drafting and effective dispute resolution mechanisms.
This study contributes to the debate on balancing statutory regulations with contractual freedom in corporate governance, providing insights relevant to India and other jurisdictions facing similar issues in a globalized business environment. It concludes by suggesting areas for future research, including comparative analyses and empirical studies on the impact of AOA-SHA conflicts.
