Meetings under company law
- 1. Meetings under Company Law
- 2. Annual general meeting An Annual general meeting refers to the meeting which is held annually by the companies. It is important for every type of company whether it is a private company or a public company, limited by shares or guarantee to conduct an annual general meeting once in a year. There shouldnât be a gap of more than 15 months between two annual general meetings. An exception is given when a company is incorporated, in such a case the company may not conduct an annual general meeting in the year at all as after incorporation, the company needs to conduct an annual general meeting within 18 months.
- 3. Extraordinary general meeting The matters which constitutes to be ordinary business of the company is discussed in statutory meeting and annual general meeting. To discuss the matters apart from ordinary business i.e. special business extraordinary general meeting is called for. Any meeting which is called apart from statutory meeting and annual general is called extraordinary meeting. Extraordinary general meeting is usually called for discussing matters which are urgent and canât wait to be discussed in the annual general meeting. The extraordinary general meeting can be called by the directors of the company as well as by the shareholders who hold at least one-tenth of the paid-up share capital of the company can make a requisition to the board of directors of the company to call a meeting.
- 4. Power to call board meetings The Secretary or a director of a company has the power to call board meetings. The board meetings can be called by the Secretary or a director by following the procedure which is laid down by the Companies Act, 2013. The meeting can be called on the direction of the Chairman/Managing Director. Any director can requisite to convene a board meeting and then on such requisition, the Manager, Secretary or any Director can summon a board meeting.
- 5. Procedure of meetings A meeting must be chaired by a chairperson. The chairperson is responsible to control the proceedings of the meeting. It is important to confirm that there is a quorum present before the meeting commences and also it is important to ensure that the quorum is maintained during the process of meeting as it is necessary for a valid motion to pass. The chairperson introduces and concludes the meeting. The chairperson has to ensure that proper notice is served to the members of the meeting and go through the minutes of the last meeting. He ensures that the meeting takes place and gets over within the time prescribed for it. He keeps order and facilitates the meeting, ensures everyone gets an equal opportunity to share their views. In case of a tie, the chairperson has to cast a final vote and declare the result.
- 6. Notice A notice of a meeting is served to all the members of the meeting to discuss the business at the meeting. The contents of the notice depends on the type of meeting which is called for, if the company has called for annual general meeting, it will include all ordinary business which will be discussed in the meeting and if extraordinary general meeting is called by the company, then the notice will include the special business and resolutions which will be discussed in the meeting. Annual general meeting needs a notice to be served to the members of the meeting in advance of 21 days whereas, in the extraordinary general meeting notice is needed to be served in advance of 14 days.
- 7. Contents of notice The notice must contain the following contents: â Place where the meeting will be conducted â Date, day and time on which the meeting will be conducted â The business which will be discussed in the meeting â Brief of business â The date on which notice is served â Signature of the convener of the meeting
- 8. Quorum Section 103 of the Companies Act lays down the Quorum which is required for the meeting. The quorum refers to the minimum number of members required to conduct a meeting. According to Section 174 of the Companies Act, one-third of the total number of members to the meeting constitutes a quorum for the meeting. A quorum of the meeting has to be maintained throughout the meeting. In order to ensure that quorum is present throughout the meeting, a roll call is to be made by the chairperson before the commencement, in between after every break and at the time of when the meeting is being concluded. In case the quorum is not present then the meeting will be called off.
- 9. Chairman A meeting is chaired by a chairperson. The chairperson is responsible to control the proceedings of the meeting. He introduces and concludes the meeting. The chairperson has to ensure that proper notice is served to the members of the meeting and go through the minutes of the last meeting. He ensures that the meeting takes place and gets over within the time prescribed for it. He keeps order and facilitates the meeting, ensures everyone gets an equal opportunity to share their views. The chairperson receives motions and puts a vote on such motions. In case of a tie, the chairperson has to cast a final vote and declare the result.
- 10. Voting rights According to Section 50(2), every member who is limited by company shares and holds equity share capital will have a right to vote on all the resolutions which lie before the company. Section 188(1) states that the members who are entitled to vote shall have voting rights on a poll in proportion to the shares held by him to the paid- up equity share capital of the company.
- 11. Resolutions by Postal Ballot According to Section 110 of the Companies Act, a postal ballot is a method of voting which is used when a member who is entitled to vote cannot be physically present to vote. In such a circumstance, the member who is entitled to vote can send his vote by posting it. Postal ballot refers to the method of voting by post. This method enables members to vote, who otherwise would not have been able to because of their physical absence. Electronic mode Voting for a resolution by electronic means is known as casting vote by electronic mode or electronic voting. Voting by electronic mode includes voting by punched cards, optical scan voting system and specialized voting kiosks, telephones, private computer networks, internet, etc. Companies Act, under Section 108 includes the provision for electronic mode of voting.
- 12. Representation of Government in meetings of the companies A member can be appointed by the Government to attend meetings of the company in case the Government is a member of the company. The member appointed can be any person who the Government thinks to be fit to attend the meeting. The person who is appointed as a representative of the Government shall attend the meeting as any other member of the meeting and shall exercise similar rights and powers.
- 13. Kinds of Resolution A resolution can be defined as a decision which is taken by limited company directors or shareholders and is legally binding. There are three kinds of resolutions namely, ordinary resolutions, special resolutions and written resolutions. â Ordinary resolutions: refers to the resolutions that can be passed by a simple majority. It can be used for all kinds of matters unless thereâs a need to for special resolution. The ordinary resolutions are generally filed with a government body i.e. Companies House. â Special resolutions: the resolutions which are needed to be passed by a majority of at least 75% of the total votes in favor of the resolution at a general meeting is referred to as special resolutions. It is generally used in cases where a resolution canât be passed by an ordinary resolution and consists of special or extraordinary matters. â Written resolutions: it is used when the resolution which needs to be passed is an ordinary resolution or a simple resolution but doesnât need a general meeting for it. It is done by shareholders by simply signing and casting their votes for a resolution. In case the resolution is an ordinary resolution then it can be passed by a simple majority and in case of a special resolution, 75% of votes are needed.
- 14. Circulation of membersâ resolutions Where it agreed by at least one-third of the total directors of the company to propose a resolution under circulation in order to be decided in a meeting, it is the chairpersonâs responsibility to put the resolution for consideration. The proposed resolution should be sent in a draft together with other necessary documents to all the members of the meeting on the same day. The draft of the proposed resolution can be passed and circulated to the members of the meeting by handing it over to them, by speed post, by courier, by email or any other recognized electronic means. The resolution which is proposed to be passed should be explained in a note and sent along with the draft of the resolution to the members of the meeting.
- 15. Minutes The minute of a meeting is an essential document in which all the points, discussions, decisions which were taken in the meeting are recorded. It is an official document and is mandatorily referred to before starting a new meeting. Minutes are final when it is approved by the members of the meeting and signed by the chairperson. Minutes are written in a factual manner which gives the gist of the meeting. It generally comprises of details of meeting such as the date of the meeting, members who attended or failed to attend the meeting, proposed motions and amendments in the meeting, the proposer of such motion and members who approved it, details of the procedure of voting, recommendations and decisions taken in relation to the motion, etc.
- 16. Publication of reports and proceedings According to Section 121 of the Companies Act every public listed company has to prepare a report for each annual general meeting and then the report is to be filed with the Registrar within 30 days of the conclusion of the annual general meeting. The other companies also has to inform the registrar about the proceedings of meetings and contracts which they entered into under Section 193(2) under the Companies Act, 2013.
- 17. Service of documents on members A document can be served on members or officers of the company according to Section 20 of the Companies Act, 2013. The document which needs to be served can be sent to the member or officer of the company at the registered office of the company. The document needs to be served by registered post, courier service, by manually dropping it in the office, or by a recognized electronic means. If the member prescribes a mode of delivery of the documents, then the documents should be delivered to him through that mode. The cost of delivery is to be paid by the member in an annual general meeting for the prescribed mode of delivery.
- 18. Service of documents on the company The service of documents on the company is included under Section 20 of the Companies Act, 2013. A document can be served to a company by sending it to the company at the registered office through a registered post, courier service, by dropping it at the registered office or by a recognized electronic means. Electronic means includes transmission of documents by registered email id, or such other means by which the identity of the sender can be recognized.
- 19. Meeting of audit committee Section 177 of the Companies Act, 2013 deals with the Audit Committee. The committee must mandatorily have a minimum of three directors with independent directors forming a majority. The Audit Committee should meet at least 4 times a year. The meetings are preceded by the chairman. The quorum exists when the chairperson and at least one other member is present in the meeting. The Groupâs Chief Financial Officer (CFO) serves as the secretary of the meetings. All the members of the Board and the Chief Executive Officer of the company are entitled to attend meetings of the audit committee.
- 20. Conclusion The discussions which take place in order to decide on the matters of the company are known as meetings of the company. The Companies Act contains many provisions in relation to the meetings of the company. The meetings of the company for deciding on ordinary business and special business or extraordinary business takes place by following separate procedures and rules. The discussions which take place in order to decide on the matters of the company are known as meetings of the company. The Companies Act contains many provisions in relation to the meetings of the company. The meetings of the company for deciding on ordinary business and special business or extraordinary business takes place by following separate procedures and rules.