Annual general meeting
1. Annual General Meeting Requirement: Every company, except a One Person Company, must conduct a general meeting known as the Annual General Meeting (AGM) each year. The AGM should be scheduled so that not more than fifteen months pass between one AGM and the next.
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Example: If a company held its AGM on January 1, 2022, the next AGM should be held before April 1, 2023.
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Exception: For the first AGM, it must occur within nine months from the end of the company’s first financial year. If the company has already conducted its first AGM, subsequent AGMs should occur within six months from the end of the financial year.
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Special Circumstances: The Registrar may extend the time for holding AGMs, other than the first one, by up to three months for valid reasons.
2. Timing and Venue of AGM:
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AGMs must take place during business hours, between 9 a.m. and 6 p.m., on any day that is not a National Holiday.
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AGMs can be held at the registered office of the company or at another location within the city, town, or village where the registered office is situated.
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Example: If a company’s registered office is in Mumbai, the AGM can be held in Mumbai or another location within the city.
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Exemption: Unlisted companies can have AGMs at any place in India if all members give prior written or electronic consent.
3. Exceptions and Modifications:
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For Section 8 companies, the AGM details can be decided by the Board of Directors in advance, considering any directions from the company’s general meeting.
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For Government companies, the venue of the AGM can be a place approved by the Central Government.
4. Amendments:
- The Companies (Amendment) Act, 2017, made changes effective from June 13, 2018, allowing unlisted companies to hold AGMs at any place in India with consent from all members.
5. Section 96: This provision, outlined in Section 96 of the Companies Act 2013, mandates the Annual General Meeting (AGM) for all companies. It specifies the timing, venue, and exceptions for these crucial gatherings, ensuring transparency and accountability.
6. Examples:
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Scenario 1: A new company incorporated on July 1, 2022, should conduct its first AGM by March 31, 2023, covering the initial nine months.
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Scenario 2: If a company’s financial year ends on December 31, 2022, the AGM for that year should be held by June 30, 2023, ensuring compliance with the six-month requirement.
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Scenario 3: Unlisted companies can leverage technology for AGMs, holding them at any location with prior consent from all members. For instance, a company with members across India can conduct a virtual AGM with unanimous agreement from its members.
By adhering to these regulations, companies can efficiently organize their AGMs, fostering communication and accountability among stakeholders.
Complete Legal Text of Section 96 of the Companies Act 2013
(1) Every company other than a One Person Company shall in each year hold in addition to any other meetings, a general meeting as its annual general meeting and shall specify the meeting as such in the notices calling it, and not more than fifteen months shall elapse between the date of one annual general meeting of a company and that of the next:
Provided that in case of the first annual general meeting, it shall be held within a period of nine months from the date of closing of the first financial year of the company and in any other case, within a period of six months, from the date of closing of the financial year :
Provided further that if a company holds its first annual general meeting as aforesaid, it shall not be necessary for the company to hold any annual general meeting in the year of its incorporation:
Provided also that the Registrar may, for any special reason, extend the time within which any annual general meeting, other than the first annual general meeting, shall be held, by a period not exceeding three months.
2&3[(2) Every annual general meeting shall be called during business hours, that is, between 9 a.m. and 6 p.m. on any day that is not a National Holiday and shall be held either at the registered office of the company or at some other place within the city, town or village in which the registered office of the company is situate:
4[Provided that annual general meeting of an unlisted company may be held at any place in India if consent is given in writing or by electronic mode by all the members in advance:
Provided further that] the Central Government may exempt any company from the provisions of this sub-section subject to such conditions as it may impose.
Explanation.—For the purposes of this sub-section, “National Holiday” means and includes a day declared as National Holiday by the Central Government.]
Exceptions/ Modifications/ Adaptations
1. In case of section 8 company- In Sub-section (2) of Section 96 after the proviso and before the explanation the following proviso shall be inserted ;
Provided further that the time, date and place of each annual general meeting are decided upon before-hand by the Board of Directors having regard to the directions, if any, given in this regard by the company in its general meeting. – Inserted by Notification dated 5th, June 2015.
2. In case of Government company, in Sub- section (2) of Section 96 for the words “some other place within the city, town or village in which the registered office of the company is situate”, the words “such other place as the Central Government may approve in this behalf” shall be substituted. – Notification dated 5th june, 2015.
3. In case of Government Company – In sub-section (2) of Section 96 for the words “ such other place as the Central Government may approve in this behalf’, the words ”such other place within the city, town or village in which the registered office of the company is situate or such other place as the Central Government may approve in this behalf’ shall be substituted – Notification Dated 13th June, 2017
Note :
1. Holding of AGMs by companies whose financial year ended on 31st December, 2019
Amendment
4. Substituted by the Companies (Amendment) Act, 2017 – Ammendment Effective From 13th June 2018
In Section 96, in sub-section (2),
for the words “1,Provided that”
the following words shall be substituted, namely :-
“Provided that annual general meeting of an unlisted company may be held at any place in India if consent is given in writing or by electronic mode by all the members in advance Provided further that”
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