Annual general meeting also known as AGM is a formal meeting of the company to be conducted annually.
- Time limit of holding AGM
First AGM of the company must be held within 9 months from the date of closing of first financial year of the company.
The Subsequent AGM of the company must be held, earliest among the following:
- 15 months from the date of last AGM;
- 6 months from the closing of financial year;
- Last date of the calendar year but with the prior approval of ROC.
The meeting must be held during business hours i.e. 9 a.m. to 6 p.m.
- Notice of AGM
It is mandatory to send 21 clear days’ notice to each and every member of the company specifying date, time and place of meeting.
It should be served to every member of the company, Legal representative of any deceased member, assignee of an insolvent member, auditors of the company, every director of the company, secretarial auditor, debenture trustees or such other person as may be specified.
- Quorum of AGM
- Public company
5 members personally present in case of companies having members Upto 1000;
15 members personally present in case of companies having members Upto 5000;
30 members personally present in case of companies having members more than 5000.
- Private Company
2 members personally present in case of Private companies.
- Business to be transacted
- Ordinary businessConsideration of financial statements and reports of board of directors and auditors.Declaration of any dividend.Appointment of directors in place of retiring one.Appointment of and fixation of remuneration of Auditors.
- Special business
All business transacted other than Ordinary business are considered Special business in the AGM.
Every member is entitled to appoint proxy by filing MGT-11 duly stamped and signed but one single proxy can be appointed for a maximum 50 members and Proxy is excluded for determining Quorum.
Members having share capital exceeding 10 percent carrying voting rights is prohibited from appointing Proxy.
- Default in holding AGM
If the company is in default in holding AGM within the specified time limit then,
The company and every officer in default shall be liable for an initial fine of Rs.50,000/- and further Rs.2,500/- for each day till the default continues.
By Suraj Anand
Law Student, IME Law College, Ghaziabad