Saturday, 11 October 2014

Companies Act 1956: Annual General Meeting

AGM of a company is the annual meeting and it is held as per the provisions of sec 166 and 167. 

Following are the provisions:
AGM called by BOD:
  • Under Section 166(1) every company must hold AGM.
  • Under Section 166(1) one AGM must be held in every calendar year.
  • Under Section 166(1) the first AGM of the company must be held within 18 months from incorporation.
  • Under Section 166(1) the maximum gap between two AGMs’ is 15 months.
  • Under Section 166(2) the AGM must be held on a day which is not a public holiday and it must be held in the same city in which registered office of the company is situated. So the AGM must be held in the city in which the company has registered office and it cannot be held in any other city.
  • The Annual General Meeting must be held during the office hours it is compulsory to start Annual General Meeting during the office timing. However the Annual General Meeting may end beyond office hours also.

AGM called by Central Government: NCLT
Any member of the company may make an application to the central government for calling the Annual General Meeting. The central government may make an order for order of holding the Annual General Meeting of the company in this case the government may order the AGM on any date including a holiday.
In this case the provisions of section 166 are not applicable.

Extra ordinary General Meeting of a company:
Extra ordinary General Meeting is called by BOD for any purpose whenever it is required.
Any member or director of company may request NCLT to call Extra ordinary General Meeting.
If any shareholder/member of company having 10% or more voting power wants to call Extra ordinary General Meeting then they may also call the Extra ordinary General Meeting, however they have to make the request to company for calling the Extra ordinary General Meeting and the BOD shall call the Extra ordinary General Meeting within 21 days of the request.

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