Normally, gathering of two or more persons means Meeting. If we stick to our topic, the companies running their business throughout the year by the management of the company, by the fund i.e. capital provided by members of the company initially. Therefore it becomes a right of members to be regularly updated about the working of the company and how it is performing, whether company is abiding by law, whether company is making profits or not and other important aspects to be disclosed to them by the management if not on detailed basis but atleast in summarized basis.
Hence, Annual General Meeting can be said as meeting which is held yearly for members of the company which discloses functioning of the company all over the previous Financial Year in details in quantitative and qualitative aspects. Section 96 of The Companies act, 2013 read with The Companies (Management and Administration) Rules, 2014 deals with the convening of Annual General Meeting. Now let us go through important points for convening of Annual General Meeting:-
If any company contravenes the provision of Section 96 of the Companies Act, 2013, the company and every officer of the company who is in default shall be punishable with fine which may extend to one lakh rupees and in the case of a continuing default, with a further fine which may extend to five thousand rupees for every day during which such default continues.
Note that if company is listed it needs to comply further with the provisions of Securities and Exchange Board of India, various Regulations also as applicable to the company for the time being and non-compliance of them further attract the penalties such regulations.
Disclaimer: The above article is extract of provision of Annual General Meeting under The Companies Act, 2013 and the interpretation is purely based on the existing information, any further amendments in provision may lead to change in its interpretation accordingly.
(The Author is Corporate Consultant and can be contacted through email id:- firstname.lastname@example.org)