Annual Filing of the Companies is the next important step marked in the compliance list. Every Company other than one person Company has to convene Annual General meeting (AGM) within a period of six months from the end of financial year and in case of first AGM, the same shall be held within a period of nine months from the closure of first financial year.

Now, to convene AGM, a notice is to be sent to the shareholders, auditors, Directors, Debenture Trustee, if any and other members entitled to receive notice such as stock exchange, RTA, etc. of the Company in accordance with Section 101 and 102 of the Companies Act, 2013 read with Secretarial Standards – 2. In this article, we will discuss about the important points to be included in the Notice of the Company.

CHECKLIST TO DRAFT NOTICE: 

1. Initially, work out the objects you need to include in your notice. There are four important ordinary businesses that can be transacted at the AGM. They are:

  • Consideration of financial statements, Directors and Auditors Report;
  • Declaration of Dividend;
  • Appointment of Directors in place of those retiring;
  • Appointment of auditors and fixation of remuneration thereon.

Apart from these, any business if required to be transacted shall be treated as a Special Business. However, there is a difference between special business and special resolution.

Further, it is pertinent to note that till now, there was a need to ratify the appointment of auditors at every AGM of the Company but now, the same has been dispensed with.

2. In every public Company, at least two third of the total number of Directors shall be liable to retire by rotation. Out of these two third Directors, one-third shall retire at every AGM.

3. It is important to check the terms and duration of appointment of Directors and auditors of the Company. In case the duration of appointment is expiring, the same needs to be taken care of.

4. After working out the objects to be included in the Notice, the following points to be taken care while drafting the notice:

  • It should be compulsorily in writing and an oral intimation cannot be considered as notice.
  • Notice shall state the day, date, time of commencement and full address of the venue of the meeting. It is important to note that the Companies shall start the meeting during the business hours but it is not important that the meeting ends within the business hours; the meeting may end after business hours.
  • It shall state the nature of meeting and the business to be transacted thereat.
  • In case of special business, each item shall contain a resolution along with an explanatory statement. However, resolutions are not required to be stated in case of ordinary business.
  • At least twenty one clear notice shall be given to convene AGM i.e. date of service of notice and date of AGM are to be excluded in calculating twenty one days.

In conclusion, I would like to mention that it is very important to draft notice in compliance with the provisions of Companies Act, 2013 and . Secretarial Standards – 2 Further, it is always advisable to seek advice from an experienced professional for the same as an irregular notice can invalidate the AGM as a whole. Therefore, it is always better to be in compliance as non-compliance is anyhow always expensive and burdensome than compliance.

{The author is a Company Secretary in Practice and can be reached at (M) 9999952595 and (E) [email protected]}

Author Bio

Qualification: CS
Company: Kajal Goyal and Associates
Location: Delhi, Delhi, India
Member Since: 11 Jun 2018 | Total Posts: 80
KAJAL GOYAL AND ASSOCIATES, is a Company Secretary proprietorship firm, offering its expertise and one stop solutions for all Corporate compliance requirements to the clients with a strong emphasis on ethics and ‘being on toes’. Capable delivering services related to Companies Act, FEMA, Re View Full Profile

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