What is an Annual General Meeting (AGM)?

Annual general meeting is mandatory to be conducted by the private limited companies or public limited companies. It is an opportunity for all the shareholders to increase their mutual bonds by meeting each other every year and discuss all the important issues and matters of the company.

In this article, we will discuss the important features of the annual general meeting held every year.

What is the main purpose for organizing the Annual General Meeting every year?

In India, annual general meeting is the statutory requirement of all the private and public limited companies. Every company whether it is private or public limited company or with or without capital share has a requirement to hold and annual general meeting every year.
It is basically a meeting conducted by all the shareholders and directors of the company for the following purposes:

Approval of the audited accounts of the company

To finalize the appointments of the directors and auditors

Compensation of the officers

Confirmation of the post dividends

Other issues raised by the respective shareholders.

When should be the first annual general meeting of the company meeting of the company held?

It is compulsory to hold an annual general meeting within the 18 months from the date of incorporation of a public or private limited company. Even if there is no purpose or activity to discuss in the meeting, the company is required to conduct the meeting. Subsequently an annual general meeting must be held on the earliest following dates:

15 months from the last annual general meeting date.

The last day of the year i.e. 31st December

6 months from the closing date of the financial year i.e. 30th September.

Note: In the case, the first AGM is held within the time period of 18 months from the incorporation date of the company, it is not important to hold any AGM in the year of incorporation or in the following year.

What is the Notice for Annual General Meeting?

It is a notice for all the shareholders and directors that need to be informed about the AGM. It includes proper date, time and venue of the AGM. The notice must be sent to the respective members, at least 21 days before conducting the meeting. Short notices can be provided with the consent of all the members entitled to vote at the conducted meeting.

What is quorum for annual general meeting?

Quorum is the minimum number of members of the company to be present in the meeting or assembly to make the proceedings of that meeting valid. In case of a public limited company at least 5 members must be present to attend the meeting according to the quorum.

In case of a private limited company the least number of 2 members should be present at the meeting to meet the requirements of the quorum of the meeting unless the article of association requires a larger quorum. The proxy becomes invalid in these cases. In case the quorum is not present within the half of an hour of the time appointed for the meeting, the meeting will be adjourned to the next week on same day, time and venue.

Conclusion:

Annual general meeting are compulsory for all the private and public limited companies. Notice for the AGM should be provided to the members and directors at least before 21 days of the meeting. To know more about the annual general meeting or to get assistance regarding conduction of AGM drop an e-mail to Swarit Advisors at [email protected] or call them on their helpline number +91-9821399320.

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