4 types of company meetings are;
- Statutory meeting,
- Annual general meeting,
- Extraordinary general meeting,
- Class meetings.
Every company limited by shares and every company limited by guarantee and having a share capital shall, within not less than one month and not more than six months from the date at which the company is entitled to commence a business, hold a general meeting of the members of the company.
This meeting is called the ‘statutory meeting.’ This is the first meeting of the shareholders of a public company and is held only once in the lifetime of a company.
Statutory report: The Board of directors shall, at least 21 days (based on Companies Act) before the day on which the meeting is to be held, forward a report, called the ‘statutory report,’ to every member of the company.
Procedure at the meeting;
- List of members,
- Discussion of matters relating to a formational aspect,
Objects of the meeting and report;
- To put the members of the company in possession of all the important facts relating to the company.
- To provide the members an opportunity of meeting and discussing the management, methods, and prospects of the company.
- To approve the modification of the terms of any contract named in the prospectus.
Annual General Meeting
Company to hold an annual general meeting every year. Every company shall in each year hold, in addition to any other meetings, a general meeting as its annual general meeting and shall specify the meeting as such in the notice calling it.
There shall not be more than 15 months between one annual general meeting and the other. But the first annual general meeting should be held within 18 months from the date of its incorporation.
The Registrar may, for any special reason, extend the time for holding an annual general meeting by a period not exceeding 3 months. But no extension of time is granted for holding the first annual general meeting.
Every annual general meeting shall be called during business hours on a day that is not a public holiday.
It 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.
As regards holding of the annual general meeting, no distinction is made between a public company and a private company.
A general meeting of a company may be called by giving not less than 21 days’ notice in writing.
Annual general meeting a statutory requirement: The annual general meeting of a company is a statutory requirement. It has to be called even where the company did not function during the year.
Canceling or postponing of convened meeting: Where an annual general meeting is convened for a particular date, and notice is issued to the members, the Board of directors can cancel or postpone the holding of the meeting on that date provided power is exercised for bona fide and proper reasons.
Canceling of failure to hold an annual general meeting: If a company fails to hold an annual general meeting:
- Any member can apply to the Company Law Board for calling the meeting.
- The company and every officer who is in default shall be punishable with a fine.
Powers of Company Law Board to call an annual general meeting: If a company makes the default in holding an annual general meeting, any member of the company may apply to the Company Law Board for calling such a meeting.
Penalty for default: If a company makes the default is holding a meeting by Company Law or in complying with any direction of the Company Law Board is calling a meeting, the company, and every officer of the company who is in default, shall be punishable with fine.
Extraordinary General Meeting
A statutory meeting and an annual general meeting of a company are called ordinary meetings.
Any meeting other than these meetings is called an extraordinary general meeting. It is called for transacting some urgent or special business which cannot be postponed till the next annual general meeting.
It may be convened. (1) By the Board of directors On its own or on the requisition of the members; or (2) by the requisitionists themselves on the failure of the Board of directors to call the meeting.
- The extraordinary meeting convened by the Board of directors. The Board of directors may call an extraordinary general meeting:
- On its own.
- On the requisition of the members.
- An extraordinary meeting convened by the requisitionists Power of Company Law Board to order meeting: If for any reason it is impracticable for a company to call, hold or conduct an extraordinary general meeting, the Company Law Board may call an extraordinary meeting.
Under the Companies Act, class meetings of various kinds of shareholders and creditors are required to be held under different circumstances.
Class meetings of the holders of different classes of shares are to be held if the rights attaching to these shares are to be varied.
Requisites of a Valid Meeting
A meeting can validly transact any business if the following requirements are satisfied;
- The meeting must be duly convened by proper authority.
- Proper notice must be served in the prescribed manner.
- A quorum must be present.
- A chairperson must preside.
- Minutes of the proceedings must be kept.