Company Meeting: Meaning, Kinds, Essential, Detail information about "AGM":

Key Points:

1.Introduction of Company Meeting.

2.Meaning of Company Meeting.

3. Type /Kinds of Company Meeting.

 (I) Meeting of Shareholders.

  (i) Annual Meeting,

  (ii) Extraordinary Meeting,

  (iii) Class Meeting,

 (II) Meeting of Directors.

  (i) Meetings of Board of Directors,

  (ii) Meetings of committee of Directors,

 (III) Meetings of Creditors, Debentures holder and Contributories.

  (i) Meeting of Creditors and Debentures holder otherwise than in winding up,

  (ii) Meetings of Creditors and Contributories in winding up

4. Characteristics /Essential /Features / Ingredients /Component /Requisites of Valid Meeting.

5. Meetings of Shareholders

 (i) AGM or GM or AM Section - 96

  (a) Meaning of AGM.

  (b) Rules regarding AGM (Statutory Provisions).

  (c) Business to be transacted at AGM.

Link : https://smckk14.blogspot.com/2023/03/cost-audit-meaning-objectives.html

1.Introduction of Company Meeting:

A company calls on the time to time the meeting of Directors, Debenture holders, Creditors, Shareholders etc. in which concerned decision relating to company are taken.

2.Meaning of Company Meeting:

Meeting means gathering of two or more persons at a certain place on the basis of pre - information to discuss on the some agenda. i. e. Gathering of two or more persons for legal purpose (s) is called “Meeting”.

3. Type /Kinds of Company Meeting:

(I) Meeting of Shareholders -

(i) Annual Meeting,
(ii) Extraordinary Meeting,
(iii) Class Meeting,

(II) Meeting of Directors -

(i).Meetings of Board of Directors,
(ii) Meetings of committee of Directors,

(III) Meetings of Creditors, Debentures holder and Contributories.

(i).Meeting of Creditors and Debentures holder otherwise than in winding up,
(ii) Meetings of Creditors and Contributories in winding up.

4. Characteristics /Essential /Features / Ingredients /Component /Requisites of Valid Meeting:

(1) Properly Convened:

It is essential that (a) All the persons i.e. members directors, auditors etc. who are eligible to present and participate, should be properly informed. (b) Meeting should be convened by those persons who are duly authorised to do so.

(2) Proper Authority:

(i) Board of Directors:

AOA of the company authorised Board of Directors to call the meeting. Even AOA has no clear provisions in this regard, the Board of Directors may call the meetings. Notice of meeting is given by secretary after permission of Board of Directors only otherwise invalid.

(ii) Members:

In special circumstances the members of the company may also demand to conduct EGM.

(iii) Central Government:

If due to any reason the company makes default in calling AGM or it is not possible for company to call the General Meeting, the Central Government itself may order to call the meeting or after obtaining application from members may order to call the meeting.

(3) Proper and Adequate Information: (Refer information of meeting under methods of meeting)

(4) Properly Constituted Meeting:

(i) Chairman, (ii) Quorum, (iii) Agenda.

(5) Properly Conducted:

(i) According to provisions of AOA and rules of Companies Act, 
(ii) Discussion in proper way, 
(iii) Decision according to proper voting, 
(iv) Resolution must be properly passed, 
(v) Minutes must be properly made.

(I) Meetings of Shareholders

(i) AGM or GM or AM Section - 96

(a) Meaning of AGM:

AGM means the meeting of members which is conducted every year under the provisions of company law.

Definition 96(1) - Every company other than and a OPC (One-person company) shall hold a General Meeting as its AGM in each year in addition to any other meetings.

The notice of such meeting must contain that this is the AGM of the company.

(b) Rules regarding AGM (Statutory Provisions):

(i) AGM must be convened once in a year.

(ii) In case of first AGM, it shall be held within 9 months from the date of closing of the first financial year and in any other case, within 6 months from the date of closing of the financial year.

(iii) If the company holds its first AGM as mentioned under (ii), its shall not be necessary to hold any AGM in the year of incorporation.

(iv) The registrar may, for any special reason, extend the time within which any AGM, other than the first AGM, shall be held, by a period not exceeding three months.

(v) Every AGM shall be called during office hours i.e. between 9 a.m. to 6 p.m. except on the national holiday and shall be held either at the registered office.

In case of unlisted company of the AGM may be held at any place in India on the basis of written consent or electronic consent by all the members.

(vi) Central government may exempt any company from this provisions subject to such condition as it may impose.

(vii) Time, date and place are to be decided by board of directors beforehand.

(viii) If company makes any error in calling AGM, the NCLT (National Company Law Tribunal) on application for any member, may call meeting itself, if it things appropriate or may order the company to call the meeting.

In such case, the NCLT, may issue necessary instruction including the instruction that in such meeting, if only one member or his /her proxy is present the meeting will be valid.

(ix) Chairman:

Generally in AOA, it is provided that the chairman of board of directors shall be the chairman of AGM. If not provided, chairman will be elected by the members present.

(x) Absence of chairman:

If the chairman does not register his presence in the meeting within 15 minutes or despite presence does not want to accept the post of chairman, the members will elect any member to act as chairman. If any director who is present but does not want to be chairman, the members present shall select any member out of them.

(xi) Notice:

At least before 21 days of AGM but if all the members having voting rights give consent for less days, AGM may be called.

(xii) Contents of Notice (101):

(a)Serial number (43/56) of meeting, (b) Information that meeting is going the be conducted, (c) Date, Place & Time,(d) Printed financial accounts and Balance Sheets, (e) Directors report, (f) Auditors report.

(xiii) Person entitled to receive Notice:

(a). Every member whose name is registered in the register of Companies,

(b) Successor of deceased member,

(c) Liquidator of insolvent member,

(d) Auditors of company

(xiv) Quorum:

Generally AOA contains the number of quorum. It cannot be less than minimum prescribed number of members provided in Companies Act. If AOA does not contain quorum, then in case of public company minimum 5, if number of members at the day of meeting is 1000 and in case of private company minimum 2.

(xv) Adjournment:

If any AGM is adjourned, only those agenda shall be considered which would not be considered in previous meeting. Such meeting must be conducted within prescribed time.

(xvi) Notice of Adjourned Meeting:

If a meeting is adjourned for twenty or more days, the members shall be informed in such a manner as in original AGM.

(xvii) Penalty:

Company and defaulting officers, Directors will be punished with up to rupees 1,00,000 and if error continuous, 5,000 per day additional.

(c) Business to be transacted at AGM:

(a) Ordinary Business (102):

(i) Considering and adopting annual accounts and balance sheet and reports of directors & auditors.

(ii) Declaration of dividend (if any)

(iii) Appointment of new directors in place of retiring directors on rotation basis.

(iv) Determining remuneration of auditor and appointment.

These business need passing of ordinary resolution.

(b) Special Business:

Any business other than ordinary business. Such special business may be transacted only if provided in AOA and members have been duly informed according to provisions of Companies Act. While informing, special business must be included in agenda.

Special business may be passed by ordinary or special resolution according to Companies Act. E.g. (i) Increase in authorised capital is special business but may be passed through ordinary resolution, (ii) Alteration in AOA is special business but may be passed through special resolution. For special business, members have to be informed according to act and resolution is passed by 3/4^th or more voting.

Following are Special Business -

(i) Alteration in AOA,
(ii) Increase in authorised capital,
(iii) Appointment of Manager or Managing Director,
(iv) Alteration in MOA,
(v) Appointment of New Directors,

For ordinary business, ordinary resolution

For special business ordinary or special resolution

In addition, with regards to special business detailed note regarding the special business is to be sent.