Process of Extension of AGM Annual General Meeting

Short Summary

In this editorial, the author shall discuss the Process and provisions of extension of Due Date of Annual General Meeting (hereafter referred as "AGM").

Every company other than a One Person Company shall in each year hold in addition to any other meetings, a general meeting as its annual general meeting within a period of six months, from the date of closing of the financial year (mostly financial years end on 31^st March and due date of AGM become 30th September).

If a Company fails to hold AGM within due date then such company is liable for penalties u/s 99 of Companies Act, 2013 i.e. (complying with any directions of the Tribunal, the company and every officer of the company who is in default shall be punishable with fine which may extend to one lakh rupees and in the case of a continuing default, with a further fine which may extend to five thousand rupees for every day during which such default continues).

However, there is a provision in the act which gives power to the Registrar of Companies to extend the time period for holding of AGM maximum by 3 months. The extract is given below:

The Registrar may, for any special reason, extend the time within which any annual general meeting, by a period not exceeding three months.

Process of Extension of AGM

As per Section 96(1), if a company wants to get extension for holding of AGM after due date, such company have to follow the below-mentioned process:

STEP I: Calling of Board Meeting

• Company shall call its Board Meeting as per section 173 and Secretarial Standard I.
• Board of Directors shall discuss reason for non-possibility of holding of AGM within due date.
• Board of Directors shall pass a Board resolution for filing of application with ROC for extension of AGM and authorization of any director to sign such application. (Draft attached at the end of editorial)

STEP II: Preparation of Application

Company shall prepare an application for approval of ROC for extension of AGM. Following Points to be covered in the application:

1. About Company: (Name, Registered office, Capital Structure etc)
2. Reason for non-possibility of holding within due date
3. Attach copy of MOA, AOA of Company

STEP III: Preparation & filing of e-form

Company shall prepare e-form GNL-1 for filing of application with Registrar of Company. GNL-1 is required to file with ROC "Form for filing an application with Registrar of Companies"

• Mention Name of Company
• Select reason for application in point no 6
• Affix DSC of Director
• File same with ROC

After Step III company don’t have to do anything. Now ROC will check the facts of application and ROC feels that according to facts extension should be granted then, ROC shall give extension letter for any period maximum for three months.

Draft Formats

Draft I - CTC of Board Resolution

CERTIFIED TRUE COPY OF THE RESOLUTION PASSED IN THE MEETING OF THE BOARD OF DIRECTORS OF (NAME OF COMPANY) HELD ON (DAY, DATE AND TIME OF MEETING) AT THE (PLACE OF MEETING).

The Chairman informed the Board that as our company having (Reason for extension). Therefore, company would not be in a position to prepare its financial statements till __________________.

After discussions it was proposed to make necessary application to the Registrar of Companies, NCT of Delhi & Haryana, for extension of 3 months’ time for holding the Annual General meeting of the Company for the period ended _________________. It was further decided to authorize a representative on behalf of the Company to sign and verify the application and also to take such necessary steps for obtaining approvals, statutory, contractual or otherwise, in relation to the above said purpose.

The Board considered the same and passed the following resolution:

"RESOLVED THAT pursuant to the provisions of sub section (1) of Section 96 and other applicable provisions, if any, of the Companies act 2013, and subject to the Articles of Association of the Company and subject to such approvals, and permissions of the appropriate authorities as may be necessary the company do hereby make an application to the Registrar of Companies for extension of 3 months’ time for holding the Annual General Meeting.

RESOLVED FURTHER THAT (Name of Authorized director)of the Company, be and is hereby authorized on behalf of the Company to sign and verify the application and to take such steps as may be necessary for obtaining approvals, statutory, contractual or otherwise, in relation to the above if required and sign and execute all applications, documents and writings that may be required, on behalf of the Company and to do all acts, deeds and things including further authorization to the professional that may be necessary, proper, expedient or incidental for the purpose of giving effect to the aforesaid resolution.

RESOLVED FURTHER THAT a certified copy of the resolution be given to anyone concerned in the matter."

For and on behalf of

__________________________
Name of Director (DIN)

Draft II - Application for Extension of AGM

To,

The Registrar of Companies,

(Address of ROC)

Subject: Application for seeking extension of time for holding Annual General meeting for the period ending 31^st December 2018 under Section 96(1) of the Companies Act, 2013

CORPORATE IDENTITY NUMBER (CIN): ________________________

Dear Sir,

We would like to inform you that our Company, (Name of Company) (hereinafter referred to as the Company) is a Private Limited Company originally incorporated on __________________under the Companies Act, 1956 vide Certificate of Incorporation No. ________________ issued by the Registrar of Companies, Delhi & Haryana. The registered office of the Company is situated at __________________________. That the authorized Capital of the Company is Rs. ________________________________ and paid up capital of ___________________________.

In terms of Section 96 of the Companies Act, 2013 the Annual General Meeting for the period ended on _____________________ can be held up to ___________.

Mentioned hereunder are the circumstances due to which, our Company is not in a position to hold its Annual General Meeting latest by __________________________ in terms of section 96 read with Section 129 of the Companies Act, 2013:

Mention Reason for Non-possibility of holding of AGM

Therefore, company would not be in a position to prepare its financial statements till _________________ and hold Annual General Meeting on ___________________.

Therefore, it is not possible to hold its Annual General Meeting within the time specified under Section 96 read with Section 129 of the Companies Act, 2013. Considering the above circumstances, the Board in their meeting held on June28^th 2019, has consented to seek necessary approval from your good office for extension of time for holding the ensuing Annual General Meeting for the period ended_____________________ till _____________________ and authorized Director(s) of the company to file necessary application, obtain permission and do all the needful acts in this regard.

The application is made bona-fide and in the interest of the justice and no one will be prejudiced if the special permission is granted under section 96 (1) of the Companies Act, 2013.

In context to this, the following documents are enclosed with this application:

1. Certified true copy of the resolution of the meeting of the Board of Directors of the Company consenting to seek necessary approval for the extension in holding ensuing Annual General Meeting of the Company and also authorizing ___________________________ to make application and obtain the permission u/s 96 (1) of the Companies Act, 2013.
2. Certified true copy of the Memorandum and Articles of Association: and

In case any further details or clarification is required, we would be pleased to attend the same immediately on hearing from you.

We once again request you to kindly grant the special permission u/s 96(1) of the Companies Act, 2013 at the earliest and oblige.

For and on behalf of

__________________________
Name of Director (DIN)