pincTORS #133 question No. 45 | peplain the term "Meeting". What are the kinds of meeting? answer ¢ meeting may be generally defined as a gathering or assembly or getting together of a number of persons for transacting any jawful business. There must be atleast two persons to constitute a meeting. Therefore, one shareholder usually cannot constitute a company meeting even if he holds proxies for other shareholders. However, in certain exceptional circumstances, even one person may constitute a meeting. Itis to be noted that every gathering or assembly does not constitute a meeting. Company meetings must be convened and held in perfect compliance with the various provisions of the Companies Act, 2013 and the rules framed thereunder. Acompany is composed of members, though it has its own entity distinct from members. The members of a company are the persons who, for the time being, constitute the company, as a corporate entity. However, a company, being an artificial person, cannot act on its own. It, therefore, expresses its will or takes its decisions through resolutions passed at validly held Meetings. The primary purpose of a Meeting is to ensure that a company gives reasonable and fair opportunity to those entitled to Participate in the Meeting to take decisions as per the Prescribed procedures. The decision making powers of a company are vested in the Members and the Directors and they exercise their respective Powers through Resolutions passed by them, General Meetings > © scanned with OKEN Scanneriy W136 Questions & Answers on Company 1, of the Members provide a platform to express their will to the a m "i regrg (0 the management of the affairs of the company, fae eee eee rare ere et eer ee The meetings to be held for seeking approval to ordinary business and special business are called annual general meeting and extraordinary general meeting, In certain cases, @ company may have to hold a meeting of the members of a Particular class of members. Essentials of Company Meetings The essential requirements of a company meeting can be summed up as follows: 48). Two or More Persons: To constitute a valid meeting, there must be two or more persons. However, the articles of association may provide for a larger number of persons to constitute a valid quorum, b), Lawful Asse _ H Assembly: The gathering must be for conducting 2 ful business. An unlawful assembly shall not be a meeting in the eye of law, {ph Previous Notice: Previous notice is a condition precedent (or a valid meeting. A meeting, which is purely accidental and not summioned aft meeting in the eye of law. 2 due notice, ie nat af all a vali pirecTORS #135 to 4, To Transact a Business: The purpose ofthe meetin a Tract a business. If the meeting has no definite object oF ‘eamoned without any predetermined object, i is not a valid seating. Some business should be transacted in the meeting amino decision need be arrived in euch meeting. kinds of Meetings: 4), Annual General Meeting (section 96): Annual general meeting (AGM) is an important annual event where members get an opportunity to discuss the activities of the company. section 96 provides that every company, other than a-one person company is required to hold an annual general meeting every year. Following are the key provisions regarding the holding of an annual general meeting Holding of annual general meeting a). Annual general meeting should be held once every year. b), First annual general meeting of the company should be held within 9 months from the closing of the first financial year. Hence it shall not be necessary for the ‘company to hold any annual general meeting in the year of its incorporation. ¢). Subsequent annual general meeting of the company should be held within 6 months from the closing of the financial year. 4. The gap between two annual general meetings should not exceed 15 months, Extr Statutory ») -dinary General Meeting (Section 100 : eee re called the ordinary Meeting and Annual General Meetings & scanned with OKEN ScannerSF #136 Questions & Ani ers on Company 19, meetings of « company. all other general mestings other tha, these two are called Extraordinary General Mectings. A, very name suggests, these meetings are convened to deal wien all the extraordinary matters, which fall outside the usuay business of the Annual General Meetings. EOGMSs are generally called for transacting some urgent op special business, which cannot be postponed till the next Annu) General Meeting. Bvery business transacted at these mectings is called Special Business. Persons Authorized to Convene the Meeting The following persons are authorized to convene an extraordinary general meeting. 1. The Board of Directors, 2. The Requisitionists. 3. The National Company Law Tribunal. 4. Any Director or any two Members. o. Meeting called by tribunals: Under Section 98 of the Companies Act tribunal has been endowed with power to call for meetings on application by the member of the company or any director who is entitled to vote at such a meeting. It is basically done in the case where it is not practically possible for the company to hold a meeting other than an annual general meeting. It can pass any ancillary or consequential order a3 the tribunal may feel important, Also, under section 97 of the Act Tribunal can call an annual general mecting in case of default of the company, It can pass any ancillary or consequential order as the tribunal feel expedient to do. puns 08S wast gourd meetings: Under Section 173 ofthe Ae, this provision Bontvard mesting i8 applicable to all types of companies ing one person company. The first board mesting i int jaatory to be held within thirty days of the incorporation of a epany and subsequent o thatthe company should hold a jmum of four meetings of the board of directors. One of the satamportant aspectssthat not more than 120 days gap should etyere between two such meetings. One Person Company shall veene at least 1 board meeting in half ealendar year and the pemeen two meeting should not exceed by more than 90 re athe meeting can be done by way of video conferencing or say other audio-video means. The central government may felde upon exceptions, modifications or conditions of the fompanies or class of companies to be excluded from the sorlicabilty of this section and it can also decide which matters canit be decided upon by way of vdeo conferencing. oft f}, Class Meetings: Class meetings are those meetings, which are held by the shareholders of a particular class of shares e. preference shareholders or debenture holders. Class meetings are generally conducted when it is proposed to alter, vary or affect the rights of a particular class of shareholders. Thus, for effecting such changes it is necessary that a separate meeting of the holders of those shares is to be held and the matter is to be approved at the meeting by a special resolution. the arrears of dividends on it is necessary to call for a pass a resolution as required For example, for cancelling cumulative preference shares, meeting of such shareholders and Sas by Companies Act. In case of such @ class ers of other class of shares have no right to atten & scanned with OKEN Scanneror #138 Questions & Answers on Company 1, Question No. 46 What is the Purpose of Statutory Meetin, ie Statutory Report? oa Answer : A statutory meeting is the first meeting ofthe shareholders g¢ ‘ public limited company which is held only once in the jig. ime of the company. Companies Act provides that every pubjj, company limited by shares or limited by guarantee and having a share capital should hold a meeting of the shareholders within 6 months but not earlier than one month from the da of commencement of business of the company. ¢ te Usually, the statutory meeting is the first general meeting of ‘the company. It is conducted only once in the lifetime of the company. A private company or a public company having no share capital need not conduct a statutory meeting, Objects of Statutory Meeting Statutory Meeting is convened in order to accord the shareholders an opportunity for seeing what degree of success ‘has attained the flotation of the company and in order that any Special matters requiring their approval may be laid before them. The statutory meeting is held to inform the shareholders matters relating to incorporation, allotment of shares, contracts entered into by the company, utilization of funds etc. Notice of the Meeting ‘The Director Directors have to send a notice of the meeting to all members of the company at least 21 days before the date of the statutory meeting. pinecTORs #139 statutory Report ne directors are required to prepare and send a report, called the statutory Report’ to every member ofthe company at least 1 days before the date of the meeting, contents of a Statutory Report ‘the statutory report contains information relating to: 1. Shares allotted: The total number of shares allotted gatinguishing those allotted as fully paid up, partly paid up, shares issued for consideration other than cash etc. 2, Cash received: The total amount of cash received by the company in respect of all the shares allotted. 3, Abstract: An abstract ofthe receipts of the company and of the payments made, upto a date within seven days of the day of the report. The receipts should clearly state the amount received in respect of shares, debentures. The payments made for various purposes should be clearly stated 4. Directors, auditors and other managerial personnel: The hhames, occupations and address ofall the directors, auditors, manager and secretary of the company. Changes if any that have occurred should also be mentioned. 5. Contracts: The particulars of any contracts, modification of contracts or proposed modification of contracts, ct: The extent to which each jed out along with the 6. Underwriting cont underwriting contract has not been carTi Teasons, irectors and 7. Arrears of calls: The arrears on calls from di manger, & scanned with OKEN Scanner| #140 Questions & Answers on Company Law 8. Commission and brokerage: The particulars of commission and brokerage paid or to be paid to any director or manager in connection with the issue of shares or debentures. Certification of Statutory Report According to Section 165(4), the statutory report must be certified as correct by not less than two directors; one of whom shall be the managing director, if any. The auditors of the company would then certify it as correct regarding the shares allotted, cash received in respect of such shares and the receipts and payments of the company. Filing of Statutory Report As per provisions of Section 165(5), a certified copy of the statutory report shall be filed with the registrar for registration immediately after it has been sent to the members of the company. & Scanned with OKEN Scanner