{"id":46944,"date":"2023-10-21T14:23:14","date_gmt":"2023-10-21T08:53:14","guid":{"rendered":"https:\/\/www.cagmc.com\/?p=46944"},"modified":"2024-05-30T12:15:43","modified_gmt":"2024-05-30T06:45:43","slug":"provisions-for-calling-general-meeting","status":"publish","type":"post","link":"https:\/\/www.cagmc.com\/blog\/provisions-for-calling-general-meeting\/","title":{"rendered":"Navigating Corporate Decision-Making: Key Provisions for Calling a General Meeting under the Companies Act, 2013"},"content":{"rendered":"<p style=\"text-align: justify;\"><img fetchpriority=\"high\" decoding=\"async\" class=\"alignnone wp-image-46951 size-full\" title=\" Provisions for Calling a General Meeting\" src=\"https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2023\/10\/Copy-of-OG-5.png\" alt=\"Navigating Corporate Decision-Making\" width=\"1200\" height=\"630\" srcset=\"https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2023\/10\/Copy-of-OG-5.png 1200w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2023\/10\/Copy-of-OG-5-300x158.png 300w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2023\/10\/Copy-of-OG-5-1024x538.png 1024w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2023\/10\/Copy-of-OG-5-615x323.png 615w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2023\/10\/Copy-of-OG-5-400x210.png 400w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2023\/10\/Copy-of-OG-5-292x153.png 292w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">General Meeting is the essence of the corporate world, where shareholders&#8217; voices are heard, and made decisions and the company comes into shape. As per the standards of the Companies Act, 2013, these business gatherings provide democratic decision-making, answerability, and transparency within the organization. In the present article, we are going to discuss the key provisions for <\/span><b>calling a general meeting<\/b><span style=\"font-weight: 400;\"> under the Companies Act, 2013. In addition, we will look at the statutory provisions that govern who, when, what, and how these meetings take place in the business. In this article we&#8217;ll discus about Navigating Corporate Decision-Making.<\/span><\/p>\n<p style=\"text-align: justify;\"><b>Table of Content<\/b><\/p>\n<table style=\"width: 100%;\">\n<tbody>\n<tr>\n<td style=\"border: 1px solid #555;\">\n<ul>\n<li><a href=\"#a\"><span style=\"font-weight: 400;\">A brief note on the General Meeting<\/span><\/a><\/li>\n<li><a href=\"#significance\"><span style=\"font-weight: 400;\">Significance of <\/span><b>calling a general meeting<\/b><span style=\"font-weight: 400;\"> as per Companies Act, 2013<\/span><\/a><\/li>\n<li><a href=\"#key\"><span style=\"font-weight: 400;\">Key <\/span><b>Provisions for<\/b> <b>Calling a General Meeting<\/b><span style=\"font-weight: 400;\"> as per Companies Act, 2013<\/span><\/a><\/li>\n<li><a href=\"#takeaway\"><span style=\"font-weight: 400;\">Takeaway<\/span><\/a><\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2 id=\"a\" style=\"text-align: justify;\"><b>A brief note on the General Meeting<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">A general meeting is a formal gathering of the company\u2019s shareholders and members. Mainly it is for a shareholder, where they can be heard, discuss, and decide on significant situations regarding the company\u2019s management and performance. It is a fundamental concept of any organization and gives a means for shareholders to discuss their concerns, and rights, and participate in the procedure of decision-making for the company.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">General meetings are mainly held in compliance with the Articles of Association, and also as per laws and regulations by the corporate entities. Notice of the meeting is given to shareholders, and a meeting is conducted as per the prescribed processes. The meetings can be attended by shareholders themselves or appoint proxies to represent them. Decisions made in the general meeting by voting and any resolution need to be filed, then there will be a simple majority.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">There are two kinds of general meetings:<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li aria-level=\"1\"><a href=\"https:\/\/www.cagmc.com\/annual-general-meeting-under-companies-act-2013\/\" target=\"_blank\" rel=\"noopener\"><b>Annual General Meeting<\/b><\/a><b>: <\/b><span style=\"font-weight: 400;\">It is abbreviated as AGM, which is a compulsory meeting conducted in a year as needed by company law and guidance. The main purpose of an AGM is to examine and approve the significant corporate matters going on in the company. Such as director\u2019s elections, financial statements, appointment or re-appointment of <\/span><a href=\"https:\/\/www.cagmc.com\/auditors-under-the-companies-act-2013\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">auditors<\/span><\/a><span style=\"font-weight: 400;\">, and dividend distributions. The AGM is a great opportunity for shareholders to be involved in the company\u2019s leadership and ask queries regarding the company\u2019s operations.<\/span><\/li>\n<\/ul>\n<ul style=\"text-align: justify;\">\n<li aria-level=\"1\"><b>Extraordinary General Meeting: <\/b><span style=\"font-weight: 400;\">Its<\/span> <span style=\"font-weight: 400;\">abbreviation is EGM, this meeting is held when urgent issues arise and cannot be waited until the next AGM. These issues are approving mergers and acquisitions, making amendments\/ alterations in the company\u2019s constitution, or addressing other critical conditions that need shareholder\u2019s permission.\u00a0<\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">The primary purposes of general meetings are to create proper corporate governance in a company, answerability, and transparency. It is also providing the shareholder&#8217;s participation in shaping the company\u2019s direction.\u00a0<\/span><\/p>\n<h2 id=\"significance\" style=\"text-align: justify;\"><b>Significance of calling a general meeting as per Companies Act, 2013<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Here are the key reasons for <\/span><b>calling a general meeting<\/b><span style=\"font-weight: 400;\"> under the Companies Act, 2013:<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Transparency:<\/b><span style=\"font-weight: 400;\"> In the meeting, Companies are disclosing information, regarding financial reports, during general meetings. This transparency ensures that shareholders and members are informed about the company&#8217;s financial status and business operations.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Exercise of Shareholders&#8217; Rights:<\/b><span style=\"font-weight: 400;\"> General meetings are a fundamental means for shareholders to exercise their rights. These meetings allow shareholders to <\/span><a href=\"https:\/\/voters.eci.gov.in\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">vote<\/span><\/a><span style=\"font-weight: 400;\"> on important issues, such as appointing directors, approving financial statements, and altering the company&#8217;s constitution. This ensures that shareholders have a say in the company&#8217;s affairs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Changes in Articles of Association:<\/b><span style=\"font-weight: 400;\"> Any changes that need to be made in the company&#8217;s Articles of Association, then require shareholder\u2019s permission in a general meeting.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Approval of Key Decisions:<\/b><span style=\"font-weight: 400;\"> Certain major decisions require the approval of shareholders in general meetings. This includes mergers, acquisitions, major capital expenditures, and changes in the company&#8217;s capital structure. Shareholder approval helps prevent misuse of power by company management.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"https:\/\/www.cagmc.com\/auditors-appointment-under-companies-act\/\" target=\"_blank\" rel=\"noopener\"><b>Auditors Appointment<\/b><\/a><b>:<\/b><span style=\"font-weight: 400;\"> Shareholders will be permitted to appoint the auditors in a general meeting.\u00a0 It helps in managing the process of auditing and ensures the independent scrutiny of the company\u2019s financial system.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Minority Shareholder\u2019s Protection: <\/b><span style=\"font-weight: 400;\">It secured the interests of minority shareholders by raising objections, speaking about their issues, and voting against the decisions, which they believe are not in their interests<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Accountability: <\/b><span style=\"font-weight: 400;\">These meetings provide an evaluation of management, and the board of directors are liable to answer for their actions and decisions. It\u2019s the right of the shareholders to raise queries about the operations and <\/span><a href=\"https:\/\/www.cagmc.com\/category\/finance\/page\/4\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">financial health of the company.<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Legal Compliance:<\/b><span style=\"font-weight: 400;\"> The Companies Act, 2013, mandates the holding of annual general meetings for companies. Compliance with these statutory requirements is essential to avoid legal consequences and maintain the company&#8217;s good standing.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Communication and Engagement:<\/b><span style=\"font-weight: 400;\"> General meetings foster communication between the management and shareholders. They provide a platform for the company to convey its strategic plans and allow shareholders to provide feedback and ask questions.<\/span><\/li>\n<\/ul>\n<h2 id=\"key\" style=\"text-align: justify;\"><b>Key Provisions for Calling a General Meeting as per Companies Act, 2013<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">The <\/span><b>provisions for calling a general meeting<\/b><span style=\"font-weight: 400;\"> of a company are provided under section 96 of the Companies Act, 2013. Here are the <\/span><b>provisions for calling a general meeting:<\/b><\/p>\n<ul>\n<li><a href=\"https:\/\/www.cagmc.com\/notice-of-annual-general-meeting-agm\/\" target=\"_blank\" rel=\"noopener\"><b>Notice of Meeting<\/b><\/a><b>:<\/b><span style=\"font-weight: 400;\"> To call upon the members, the company issues a notice for a meeting. The notice provides the time, place, and date of the meeting. It must also include the meeting agenda.\u00a0<\/span><\/li>\n<li><b>Period for Notice: <\/b><span style=\"font-weight: 400;\">A general meeting can be called with a notice period of at least 21 days. However, the period may be shorter if members holding at least 95% of the total voting power agree to a shorter notice.<\/span><\/li>\n<li><b>Exception for Shorter Notice: <\/b><span style=\"font-weight: 400;\">There is a time when a shorter notice period is allowed as in case of an emergency meeting. However, there must be 95% of the voting power agreed upon by members holding.\u00a0<\/span><\/li>\n<li><b>Means of Notice: <\/b><span style=\"font-weight: 400;\">Notices<\/span> <span style=\"font-weight: 400;\">can be delivered to electronic and physical means. Such as by courier, post, email, or other electronic communication systems.<\/span><\/li>\n<li><b>Quorum: <\/b><span style=\"font-weight: 400;\">There are certain members, who have to present in the meeting. For the quorum for a general meeting of a private company, there must be two members personally presented and in the case of a public company five persons personally presented.\u00a0<\/span><\/li>\n<li><b>Proxies: <\/b><span style=\"font-weight: 400;\">Members are allowed to appoint proxies to attend and vote on their behalf in the general meeting. The details of the proxy should be mentioned in the notice of the meeting.<\/span><\/li>\n<li><b>Voting: <\/b><span style=\"font-weight: 400;\">Decisions at a general meeting are generally made by a simple majority vote unless the <\/span><a href=\"https:\/\/www.cagmc.com\/moa-and-aoa-of-a-company-under-companies-act-2013\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Articles of Association<\/span><\/a><span style=\"font-weight: 400;\"> specify a different requirement.<\/span><\/li>\n<li><b>Remote Participation: <\/b><span style=\"font-weight: 400;\">In case the Articles of Association of the company allows video conferencing, then the participation in the meetings can be attended by electronic means.<\/span><\/li>\n<li><b>Adjournment: <\/b><span style=\"font-weight: 400;\">If a quorum is not present within half an hour, then the meeting will be adjourned.<\/span><\/li>\n<\/ul>\n<h2 id=\"takeaway\" style=\"text-align: justify;\"><b>Takeaway<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">In conclusion, it can be said that <\/span><b>provisions for calling a general meeting<\/b><span style=\"font-weight: 400;\"> as per the Companies Act, 2013 are not just a legal formality, but it is a lifeblood of the companies. These instructions empower the shareholders, promote transparency and make sure that significant decisions must be taken collectively, along with protecting all <\/span><a href=\"https:\/\/www.cagmc.com\/variation-of-shareholders-right-under-section-48-of-companies-act-2013\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">shareholder\u2019s<\/span><\/a><span style=\"font-weight: 400;\"> interests. The general meeting is a good example of democratic participation in corporate decision-making. To determine the Companies Act, 2013 and understanding the significance of <\/span><b>calling a general meeting<\/b><span style=\"font-weight: 400;\"> led to building trust in the company, managing compliances, and adopting responsible business practices.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>General Meeting is the essence of the corporate world, where shareholders&#8217; voices are heard, and made decisions and the company [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":46951,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[70],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Provisions for Calling a General Meeting under the Companies Act.<\/title>\n<meta name=\"description\" content=\"Provisions for Calling a General Meeting under the Companies Act- A general meeting is a formal gathering of the company\u2019s shareholders.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.cagmc.com\/blog\/provisions-for-calling-general-meeting\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Navigating Corporate Decision-Making\" \/>\n<meta property=\"og:description\" content=\"Provisions for Calling a General Meeting under the Companies Act- A general meeting is a formal gathering of the company\u2019s shareholders.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.cagmc.com\/blog\/provisions-for-calling-general-meeting\/\" \/>\n<meta property=\"og:site_name\" content=\"Goyal Mangal &amp; 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