Annual general meeting ( SECTION 96 )

Mandatory requirement for holding AGM Every company is required to hold AGM every year (but no such requirement in OPC). Holding AGM in every calendar year is statutory necessity. Calendar year is from January 1 to December 31 and not 12 months from date of incorporation of company.

Companies that can hold AGM Every company can hold AGM, Whether public or private, Having share capital or not, Limited or unlimited, Can hold AGM Except, One Person Company(OPC)

Objects of holding AGM To protect shareholders interest by giving them chance to review company’s working. To replace or reappoint auditors by shareholders. To declare the dividends proposed by the directors. To get approvals from shareholders. To re-elect the directors. To discuss ‘Special Business’ i.e. the matters that require approval of shareholders.

Time period for holding AGM First AGM to be held within 9 months from the end of first financial year. Subsequent AGM provisions are given u/s 96 of Companies Act,2013 Business hours between 9 a.m. and 6 p.m. {defined u/s 96(2)}

Subsequent AGM (u/s 96) Held on the earliest of the following three dates : One separate and distinct meeting must be held in every calendar year. If a meeting is adjourned to a date in next year, it will not become meeting of that year. Maximum gap between two AGMs can be 15 months. Must be held within 6 months from close of financial year i.e. from date of financial year. Failure to comply with any of them constitutes offence.

Extension of time ROC can extend the time, to hold the AGM for special reasons, up to 3 months {section 96(1)}. Extension is not available for the first AGM. In case of extension of three months, the interval between 2 successive AGMs shall not exceed 18 months. An application for extension is to be filed before the expiry of the period prescribed in section 96(1). Court or NCLT do not have the power to extend time, call and conduct the AGM. Only ROC has the power to grant extension.

Validity of AGM held beyond Statutory time AGM held beyond due date is not void All resolutions passed are valid But it invites penalty u/s 99 Rs. 1,00,000 and additional fine up to Rs.5,000 for every day of default.

NOTICE A public company must give at least 21 clear days notice for convening AGM .The period of 21 days is calculated from the date of receipt of notice by the members. It excludes :- 1. Day of service of notice 2. Day on which the meeting is to be held

NOTICE TO WHOM (Section 77) Every member of the company Legal representative of deceased Receiver or official assignee of an insolvent member Auditors of the company Every directors of the company

TIME & DAY OF AGM TIME :- Starting Time 9 AM – 6 PM (Business Hours) Ending Time as per the agenda (notice without time is invalid) DAY :- Day for AGM should not on be a public holiday ( it includes sundays or any day which central govt. declared as public holiday)

PLACE OF AGM At registered office of company If at any other place then it should be with in same town, city or village as registered office is situated.

QUORUM (Section 103) It is the minimum number of required in meeting. If < 1000 members = 5 members If 1000 – 5000 members = 15 members If >5000 members = 30members

Business to be transacted (section 102) ORDINARY BUSINESS (transacted by passing ordinary resolution) :- Consideration of accounts, balance sheet & report of board of directors & auditors Declaration of dividend Appointment of directors in places of those retiring Appointment of & fixing of remuneration of, auditors

SPECIAL BUSINESS:- All matters other than ordinary business For that an explanatory statement is required which contains:- All material facts concerning each item The interest of director or key managerial personnel in above Time & place where document for approval can be inspected by the members Absence of this statement renders the meeting invalid .

Procedure for holding adjourned AGM AGM can be adjourned by chairman, But if wrongful adjournment the members may appoint a chairman, Notice is not required to be given, Unless the date is not fixed in original meeting,

AGM by tribunal[section 97] If company fails to hold AGM within prescribed period [sec 96] The tribunal on application by member, may :- Either call or direct calling of a general meeting of the co. Give directions in regard to calling ,holding or conducting of such meetings,

Penalty [sec 99] Rs.1,00,000 and In case of continuing default ₹5000 per day

Drafting the notice of AGM AGM should be held at registered office or with in same city, town or village. AGM should not be on public holiday. Meeting should be during business hours. The gap between accounts preparation should not be more than 6 months. Resolution must be set out for any special to be considered . Notice should be under proper authority. The gap b/w the date of notice & the date of meeting should not be less than 21 days.

Duties of the Secretary in connection with AGM Responsible for making all arrangements for holding AGM of the company. His work may be divided into three sections. Preparations of AGM before the meeting Secretarial work during the course of AGM Secretarial work immediately after AGM

(A) Preliminary duties before the meeting To prepare final accounts To get approval from board To submit final accounts to Statutory Auditors To draft various documents To fix the schedule of the AGM To fix Board Meeting to finalize the AGM

To correspond and intimate the Stock Exchange To make arrangement for printing To issue notice of AGM To fix the Agenda of the Meeting Publication of notice of closure of register of members To prepare the list of Proxy Forms To prepare Dividend List

(B) At The Meeting To collect Attendance Slips To assist the Chairman in Ascertaining the Quorum To read the notice of the meeting Chairman’s speech Duty to read Director’s and Auditor’s Report To assist the Chairman in answering the queries To take notes of proceedings of the meeting

(C) After the Meeting To prepare Minutes To deposit the amount of dividend in separate bank account To make arrangements for the issue of Dividend Warrants To deposit Corporate Dividend Tax To file copies of Final Accounts with the Registrar To prepare Annual Return To get the Special Resolution Registered