Holding of annual general meetings by companies whose financial year has ended on 31st December, 2019.
Ministry of Corporate Affairs vide General Circular No. 18/2020 dated 21st day of April, 2020 has issued Clarification on Holding of annual general meetings by companies whose financial year has ended on 31st December, 2019.
if the companies whose financial year (other than first financial year) has ended on 31st December, 2019, hold their AGM for such financial year within a period of 9 months from the closure of the financial year (i.e. by 30th September, 2020), the same shall not be viewed as a violation. The references to due date of AGM or the date by which the AGM should have been held under the Act or the rules made thereunder shall construed accordingly.
Decoding this MCA Circular:
> As per 2 (41) of the Companies Act, 2013:
“financial year”, in relation to any company or body corporate, means the period ending on the 31st day of March every year, and where it has been incorporated on or after the 1st day of January of a year, the period ending on the 31st day of March of the following year, in respect whereof financial statement of the company or body corporate is made up:
Provided that where a company or body corporate, which is a holding company or a subsidiary or associate company of a company incorporated outside India and is required to follow a different financial year for consolidation of its accounts outside India, the Central Government may, on an application made by that company or body corporate in such form and manner as may be prescribed, allow any period as its financial year, whether or not that period is a year:
That Means Companies which is a holding company or a subsidiary or associate company of a company incorporated outside Indiapost approval of Central Government, can decide any period as its financial year.
> As per Section 96 of the Companies Act, 2013:
Except in case of First AGM, in any other case, Company has to Convene AGM within a period of six months, from the date of closing of the financial year.
As per interpretation of both the Sections2 (41) and 96, it is hereby clarified that:
Kindly note that: not applicable for Companies for first financial year.
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