Home » Private Limited Company » Extension of Annual General Meeting (AGM)

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Extension of Annual General Meeting (AGM)

Annual General Meeting means a meeting which is held once in every year by every Company registered under the Companies Act, 2013 except One Person Company (OPC). As per section 96 of the Companies Act 2013, every company shall hold Annual General Meeting (AGM) once in year. Extension of Annual General Meeting (AGM) can be applied with NCLT i e National Company Law Tribunal under certain circumstances.

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Three Situations for holding Annual General Meeting (AGM)

Situation 1: 1^st Annual General Meeting (AGM)

If a Company is registered from 1^st January to 31^st March of any financial year, then the  1^st Annual General Meeting (AGM) of the Company shall be held within 9 months from the date of closure of financial year of the following year.

Eg: XYZ Private Limited is registered on 4^th January, 2019 then the 1^st AGM shall be held by 30^th December, 2020 I . e within 9 months from the date of closure of financial year of the following year whereby-

Financial year end : 31^st March, 2020

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Situation 2: Existing Company

The Annual General Meeting (AGM) for existing company shall be held within 6 months from the date of closure of financial year. It may noted that not more than fifteen months shall elapse between the date of one annual general meeting of a company and that of the next.

Eg: XYZ Private Limited has closed the financials for FY 2018-2019 on 31^st March, 2019 then  AGM shall be held by 30^th September, 2019 i. e within 6 months from 31^st March, 2019.

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Situation 3: Income Tax return.

If a Company is registered from 1^st January to 31^st March of any financial year, and Income tax return is filed from January to March, then the 1^st AGM shall be held within 6 months from the date of closure of financial year.

Eg: XYZ Private Limited is registered on 4^th January, 2019 and income tax return Is filed then  1^st AGM shall be held on 30^th September, 2019 shall be the date of AGM I . e within 9 months from the date of closure of financial year of the following year whereby-

Financial year end : 31^st March, 2019

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Extension of Annual General Meeting (AGM)

Extension can be applied for Annual General meeting (AGM) for any company except OPC with the Registrar of Companies.

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Extension of Annual General Meeting (AGM)

Any company who desires to extend the date of its AGM is may follow below Procedure for Extension of Annual General Meeting (AGM).

Step 1: Board Meeting

The Company shall call a board meeting for approving the proposal of extension of annual general meeting.

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Step 2: Approval of Board Meeting

Once the board of directors agrees mutually for extension of Annual General Meeting, then it must approve the same.

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Step 3: Making application to the Registrar in Form GNL-1

After the board approves the proposal, the next step is to make an application to Registrar in form GNL-1

Attachments

1. Detailed Application mentioning special reason and other necessary information
2. Certified true copy of the Board resolution
3. Optional attachment if any

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Step 4: Follow up with Officer

Once the application is filed the next step is followup with the officer of Registrar of Companies.

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Step 5: Grant of Certificate of Extension of Annual General Meeting

The Registrar of Companies shall issue Certificate of Extension of Annual General Meeting upon submission of all required documents.

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Reasons For Extension of Annual General Meeting

Extension for Annual General Meeting shall be allowed in case of following special reasons bifurcated into valid reason and not valid reason.

1. Non Availability of Annual Accounts – Not a Valid Reason for Extension of AGM Case law of Bijoy Kumar Karnani V. Assistant Registrar of Companies, Calcutta High Court.

 

2. Deficiency in the Quorum of the Annual General Meeting- Not A Valid Reason.

 

3. Company is planning to go into liquidation, and all employees along with Accounts department have left the Company- A Valid Reason

 

4. Not able to held ANNUAL GENERAL MEETING due to Natural Calamity- A Valid Reason

 

5. Confiscation of Books of accounts by Income tax department, Serious and Fraud Investigation cell, or any other government official- A Valid Reason

 

6. Sudden resignation of the Statutory Auditor from the Company without providing the audited balance sheet- A Valid Reason (depending from case to case)

 

7. Falling of director below the numbers prescribed by the Act- A Valid Reason

 

8. Such other special reason if such reason are valid and justified.

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Situation For Extension of AGM Not Allowed

As per the provisions of the Companies Act, 2013 there are some situations whereby no extension can be granted for Annual General Meeting (AGM).

1. If the chairman of the meeting in which accounts are to be approved is not available.
2. Non availability of accounts due to non compliance of Audit by the Auditor.

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Penalty Not Holding Annual General Meeting 

Company and every officer of the Company who is in default For Not Holding Annual General Meeting shall be punishable with a fine of Rs 1 lakhs and in case of continuing default with a further fine of Rs 5,000/- each day of default.

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Compounding of Offence

If the Annual General Meeting is not held within the due date as mentioned above without applying for extension of AGM with the Registrar of Companies then the company will have to apply for compounding of offence with the National Company Law Tribunal (NCLT)

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