Annual General Meeting :
(1) Section 96 provides that every company (other than a One Person Company) must hold in each year a general meeting in addition to any other meetings as its annual general meeting (AGM).
Notice of AGM: The notice of the AGM shall specify the meeting as such in the notices calling it.
Interval between two AGM: Not more than fifteen months shall elapse between the date of one annual general meeting of a company and that of the next. Thus, there can be a maximum interval of 15 months between two AGMs.
Further, the AGM shall be held within a period of six months, from the date of closing of the financial year.
First Annual General Meeting: 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
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.
Extension for conducting AGM: The Registrar may, for any special reason, extend the time within which any AGM, shall be held, by a period not exceeding three months. However, the Registrar cannot provide extension in case of the First AGM.
Date, time and place of AGM: 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 situated.
However, the Central Government may exempt any company from the fulfillment of above requirement related to date, time and place, subject to such conditions as it may impose.
Thus, it can be concluded that-
Time of AGM: During business hours – 9 a.m. and 6 p.m.
Day of AGM: Any day. But it shall not be a National holiday.
Here, “National Holiday” means and includes a day declared as National Holiday by the Central Government.
Place of AGM: AGM 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 situated.
(2) According to section 129(2) of the Companies Act, 2013, the Board of Directors of the company shall at every AGM, lay before the meeting financial statements for the financial year.
Further, section 129(3) of the Companies Act, 2013, provides that where a company has one or more subsidiaries, it shall, in addition to financial statements provided under section 129(2), prepare a consolidated financial statement of the company and of all the subsidiaries in the same form and manner as that of its own which shall also be laid before the AGM of the company along with the laying of its financial statement under section 129(2).
The following example will explain the position: The financial year of a company ends on 31st December each year. The annual general meeting to adopt the accounts, etc. of the year ending 31st December, 1991 was held on 29th June, 1992. Under Section 96, the next annual general meeting need not be held until 29th September, 1993, but the accounts would be those, up to 31st December, 1991 which is more than six months before the date of the meeting. Therefore the last date for holding that meeting would be 30th June, 1993.
Thus in fixing the date of the annual general meeting, Section 96 must be considered. Sections 96 clearly suggest that the Annual General Meeting should be held on the earliest of the three relevant dates i.e., six months after the close of the financial year, fifteen months from the previous Annual General Meeting and the last day of the next calendar year, whichever is earlier. [B.N. Viswanathan Vs. Assistant Registrar of Joint Stock Companies, Madras (1953) 23 Comp. Cas. 63; AIR 1953 Mad 558; Sevaram Pansari Vs. Registrar of Companies (1964) 34 Comp.Cas.31]
Default in holding annual general meeting: If an offence is committed by a company by not holding an annual general meeting in accordance with Section 166(corresponding section 96 of the Companies Act, 2013), or in not complying with any directions of the Central Government it will render the company and every officer of the company who is in default, punishable with fine which may extend to ` 50,000 and in the case of a continuing default with further fine which may extend to ` 2,500 for every day after the first day which such default continued, (Section 168).
[Note: The corresponding section 99 of the Companies Act, 2013 is not yet notified. Till then section 168 of the Companies Act, 1956 will be read with respect to default in holding of AGM. For the reference for reference of Section 99 see the annexure]
The Company Law Board may, not withstanding any thing in this Act, or in the Articles of the company, on the application of any member of the company, call or direct the calling of a general meeting of the company and gives such ancillary or consequential directions as the Company Law Board thinks expedient in relation to the calling, holding and conducting of the meeting. The directions, which the Company Law Board may give, include a direction that one member of the company present in person or by proxy shall be deemed to constitute a meeting. A general meeting so held is deemed, subject to any directions of Company Law Board to be an annual general meeting of the company (Section 167).
[Note: The corresponding section 97 of the Companies Act, 2013 is not yet notified. Till then section 167 of the Companies Act, 1956 will be read with respect to the power of Central Government to call AGM. For the reference of Section 97 see the annexure]