The Secretarial Standards (SS-2) on General Meetings have been revised to align with the latest amendments in the Companies Act and its rules. These changes, effective from April 1, 2024, aim to streamline the conduct of general meetings, enhancing transparency and compliance for companies. This article delves into the significant amendments made to SS-2, shedding light on their implications for companies incorporated under the Act.
Also Read: ICSI Announces Revised Secretarial Standards: SS-1 & SS-2
Summary of amendments to Secretarial Standards (SS-2) on General Meetings
| Paragraph | Revised text of SS-2
(strikethrough provisions indicate deletions & Bold paragraphs indicate the insertions in the revised SS-2) |
Summary | Alignment with provisions of Companies Act/Rules |
| Scope | This Standard is applicable to all types of General Meetings of all companies incorporated under the Act except One Person Company (OPC) and a company licensed registered under Section 8 of the Companies Act, 2013 or corresponding provisions of any previous enactment thereof.
However, Section 8 companies registeredunder Section 8 of the Companies Act, 2013 need to comply with the applicable provisions of the Act relating to General Meetings. The exemption to a company registered under Section 8 of the Companies Act, 2013 as referred above and the specific exemptions given to a private company and Government company in this Standard shall be available only if it has not committed any default in filing its Financial Statements or Annual Return with the Registrar of Companies. |
Now, the exemption from applicability of SS-2 is available to Sec 8 companies only if they have in filed their Financial Statements/ Annual Return with the ROC. | MCA Exemption Notifications dated 13th June, 2017 |
| Definitions | “Ordinary Business” means business to be transacted at an Annual General Meeting relating to (i) the consideration of financial statements, consolidated financial statements, if any, and the reports of the Board of Directors and Auditors; (ii) the declaration of any dividend; (iii) the appointment of Directors in
the place of those retiring; and (iv) the appointment or ratification thereof and fixing of remuneration of the Auditors. |
Ratification of appointment of auditors by way of passing ordinary resolution is not required at every AGM. | The said proviso to Sec 139 (1) was Omitted vide Companies (Amendment) Act, 2017 dated 03.01.2018, effective from 07.05.2018. |
| Notice 1.2.4 | Annual General Meetings shall be held either at the registered office of the company or at some other place within the city, town or village in which the registered office of the company is situated., However, Annual General Meetings of an unlisted company may be held at any place in India, if prior consent is given by all the members either in writing or by Electronic Mode. Such consent shall be received before the Meeting. | AGM of an unlisted company – at any place in India, with prior consent of all the members. | Proviso to section 96 (2) inserted vide Companies (Amendment) Act, 2017 dated 03.01.2018, w.e.f., 13.06.2018 |
| Notice
1.2.4 5th para |
whereas other Extra-Ordinary General Meetings may be held at any place within India. In case of a wholly owned subsidiary of a company incorporated outside India, Extra Ordinary General Meetings may be held outside India. | EGM can be held at any place within India.
EGM of a WOS of a company incorporated outside India can be held outside India. |
Proviso to section 100 (1) inserted vide Companies (Amendment) Act, 2017 dated 03.01.2018 effective from 09.02.2018 |
| Notice 1.2.4 6th para | In case of a Government company, the Annual General Meeting shall be held at its registered office or such other place within the city, town or village in which the registered office of the company is situated | Exemption provided to Govt. Comp to hold AGM at its registered office/such other place within the local limits of the registered office of the company. | Proviso to section 96 (2) inserted vide notification dated 13th June, 2017 |
| Notice 1.2.7 | Notice and accompanying documents may be given at a shorter period of time if the requisite consent of Members in writing is given accorded thereto, by physical or electronic means, as under:
(i) In case of an Annual General Meeting, consent by not less than ninety-five percent of the Members entitled to vote at such Meeting. However, the Financial Statements and other documents required to be annexed thereto may be given at a shorter period of time if the requisite consent of Members in writing, by physical or electronic means, is accorded (a) if the company has a share capital, consent by the majority in number of members entitled to vote and represent not less than ninety-five per cent of such part of the paid-up share capital of the company as gives a right to vote at the Meeting; (b) if the company has no share capital, consent by the Members having not less than ninety-five per cent of the total voting power exercisable at such Meeting. (ii) In case of any other General Meeting- (a) if the company has a share capital, consent by the majority in number of members entitled to vote and represent not less than ninety-five per cent of such part of the paid-up share capital of the company as gives a right to vote at the Meeting; if the company has no share capital, consent by the Members having not less than ninety-five per cent of the total voting power exercisable at such Meeting. |
The amended section 101 provides that the general meetings may be held at a shorter notice subject to the requisite consent. This amendment in SS-2 is to include the effect of amendments in Section 101. | Companies (Amendment) Act, 2017 dated 03.01.2018, effective from 09.02.2018 |
| EFFECTIVE DATE | This Standard shall come into effect from 1st October, 2017 1st April, 2024. |
Conclusion
The amendments to SS-2 represent a significant step towards aligning secretarial practices with the current legal framework and operational realities of companies in India. By simplifying definitions, relaxing notice requirements, and clarifying the scope, these changes are expected to ease the administrative load on companies while ensuring strict compliance with the Companies Act. Companies must review these amendments carefully and prepare to implement the necessary adjustments to their general meeting practices.
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