Extension of AGM (Annual General Meeting) 2020 By CS Nishant Mishra


OVERVIEW

As we all know, we are facing unprecedented situation caused by the COVID-19 pandemic and we have to go to the unavoidable nation-wide lockdown for more than one month due to the pandemic and many parts of our country which are in containment zone are still facing the restrictive movement. So to provide relaxation to India Inc. government allowed the AGM of the company through video conferencing and other audio-visual means vide circular 20/2020, dated 05th May, 2020.    

The government further issued circular vide circular no. 28/2020, dated 17th August, 2020, clarifying that the company need to file GNL-1 before 29/09/2020 if company require any extension of the Annual General Meeting, however, Ministry also advised the Registrars of the Companies to consider such application liberally.

Due to several representations received by the different Registrar of Companies from the companies, industrial associations, and professional bodies, Registrar of different state came-up with their order to grant the extension for holding Annual General Meeting.

LEGAL PROVISION

The legal provisions related to the holding, and the extension of the Annual General Meeting, is in Section 96 (1). As per the provisions every company, other than One Person Company, needs to hold the Annual General Meeting as follows:

  1. Not more than 15 months should elapse between the date of the last year’s Annual General Meeting and current year Annual General Meeting. However, this condition will not be applicable in the case of the Company having the first Annual General Meeting; and

  2. Annual General Meeting to be held within 6 months from the end of the financial year, or in case of 1st Annual General Meeting within 9 months from the end of the financial year.

Further, Registrar may extend the time within which the Annual General Meeting to be held by not exceeding three months from the last date on which Annual General Meeting out to have been held, however, no such extension is possible in case of First Annual General Meeting.

So, Registrar of Companies, NCT of Delhi and Haryana, provided the extension as per the third proviso to sub-section (1) of section 96 of three months from the date on which Annual General Meeting out to be held.

For example, If A Limited conducted their Annual General Meeting for the financial year ending 31st March, 2019 on 1st April, 2019, for this year Annual General Meeting to be held on or before 30th June, 2020. Since the gap between two consecutive Annual General Meeting should not be more than fifteen months, and the Annual General Meeting to be held within the six months from the end of the financial year.   

Now the extension of three months from the due date i.e. 30th June, 2020 will be applicable, hence, after extension last date of holding Annual General Meeting for the financial year ending 31st March, 2020 will be 30th September, 2020.

Similarly, if B Limited conducted their Annual General Meeting for the financial year ending 31st March, 2019 on 30th September, 2019, for this year Annual General Meeting to be held on or before 30th September, 2020. Since the gap between two consecutive Annual General Meeting should not be more than fifteen months, and the Annual General Meeting to be held within the six months from the end of the financial year.  

Now the extension of three months from the due date i.e. 30th September, 2020 will be applicable, hence, after extension last date of holding Annual General Meeting for the financial year ending 31st March, 2020 will be 31st December, 2020.

It is important to note that no such extension is provided to the company having its first Annual General Meeting. 

All the e-Filing related to Annual General Meeting such as AOC-4, MGT-7, etc. to be filed accordingly as per the date of Annual General Meeting.

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