Annual General Meeting

Category: COMPANY LAW
Date: March 4, 2020

Annual General Meeting

Reference: Section 96 and 2(41) of the Companies Act, 2013

 

  1. As per section 96(1) Every Company, other than OPC, must hold a general meeting (AGM) in each year apart from other meetings.
  2. The time Interval between two AGM cannot be more than 15 Months and also should be held within 6 months from the closing of the Financial Year.
  3. Section 2(41) provides the definition of financial year, wherein it is stated that for a company or a body corporate financial period ending is 31st March every year.
  4. Thus, generally the 30th September is the due date for holding Annual General Meeting except following two cases:

First Annual General Meeting  :

As per first Proviso of section 96(1) first annual general meeting shall be held within a period of nine months from the date of closing of the first financial year. Example- if a Company is incorporated on 01/10/2019, the First AGM shall be held within 31st, December 2020.

But when the above proviso is read with section 2(41), Company incorporated after January for any financial year gets further exemption. When a Company is incorporated on or after the 1st day of January of a year, the period ending on the 31st day of March of the following year shall be the financial ending. Example- if a Company is incorporated on or after 01/01/2020, the First AGM shall be held within 31st,December 2021.

Power of Registrar of Companies (ROC) to extend the time :

As per third Proviso of Section 96(1) The Registrar of Companies (ROC) may extend the time for holding AGM not exceeding 3 months for any special reason at the request of the Company. But this time extension is not available for first AGM.

            Time and Place of holding AGM:

As per section 96(2) AGM shall be called during business hours (9 a.m to 6 p.m.)  and at a  location within the city, town or village where the Registered office is located but not on a national holiday.

But in case of private and unlisted public company AGM can be held in any place in India provided consent of all the members in written or electronic mode is taken in advance.

Board has been given the powers to decide date, time and place of holding AGM.

Penalty for not conducting the AGM:

If any default is made in holding a meeting of the company in accordance with section 96 or 97 or 98 or in complying with any directions of the Tribunal, the company and every officer of the company who is in default shall be punishable with fine which may extend to one lakh rupees and in the case of a continuing default, with a further fine which may extend to five thousand rupees for every day during which such default continues.

 

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