Tag Archives: Adjourned Annual General Meeting

ANNUAL GENERAL MEETING(S) 2021


At the hight of the cold wave at New Delhi, Ministry of Corporate Affairs suddenly awakens to issue two circulars within hours. We have an interesting observation: the first one published a regular font Arial/Times New Roman (who cares the font) but second used a font called – Comic Sans MS. Use of the font in a law communication communicates. We will read this circular in this post.

http://mca.gov.in/Ministry/pdf/GeneralCircularNo.02_14012021.pdf

The circular may use simpler language. Without a straightforward acknowledgement of the fact, many companies could not convene their Annual General Meeting due to be held in calendar 2020 it provide a bit of relief. 

The circular applies to companies whose Annual General Meetings:

  1. Were due to be held in the year 2020 (but could not be conducted due to whatsoever reason); or
  2. Become due in the year 2021.

The Government decided to allow these companies to conduct their meetings on or before 31 December 2021.

The circular clarifies that such Annual General Meetings may be conducted in accordance with Circular 20/2020. The Circular 20/2020 allows companies to conduct Annual General Meetings through Video Conferencing or any other audiovisual mode.

The first paragraph of the circular may create two confusions:

a. Due date for the Annual General Meeting for Annual General Meeting legally due to be held any time during the year 2020 is extended till 31 December 2021.

b. Due date for the Annual General Meeting for Annual General Meeting legally due to be held any time during the year 2021 is extended till 31 December 2021.

This possible misinterpretation immediately clarified in the second paragraph.

The second paragraph clarifies that no extension is allowed. All these companies should follow legal time-limits or face legal actions.

We consider the circular as an indication of the government understanding of difficulties faced by companies. Same time it clarifies that no extension is coming for AGM missed 31 December 2020 deadline. 

Secondly, the Government is planning a few announcements in the Budget speech. 

The most important take away from the circular is hidden advice: Companies should not take the risk for the year 2021. 

According to the law, any company which missed legal timeline in the year 2020 may opt for compounding but repeated miss in the year 2021. 

I hope the Government will compound the offence of not holding Annual General Meeting timely during the year 2020 with ease.

Government bless us.

[P.S.: I have no interpretation of the font used.]

Aishwarya Mohan Gahrana

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Serious Penal Consequence of late Annual Filing – landmine ahead


[The law stated in this post is effective from the 7th day of May 2018]

There is a perception that filing of financial statements and other documents with additional fee absolve the company from consequences under section 92, section 137 and conditional exemption given to certain companies by certain notifications issued by the Ministry of Corporate Affairs.

This is also a general view of the companies that any extension granted for the filing of the financial statements and other documents without additional fee grant immunity to the companies from its liabilities under mentioned provisions.

I beg to differ, conditionally.

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BOOKS OF ACCOUNTS


The Financial Statements of a company is most important document until recent past, when non – financial reporting started to gain its momentum. This is a reporting of growth in business in monetary units.

BOOK OF ACCOUNTS (SECTION 128):

Every company shall prepare and keep at its registered office books of accounts and other relevant books and papers and financial statement for every financial year. These books must give a true and fair view of the state of affairs of the company and its branch offices. These books must explain the transactions effected both at the registered office and its branches.  These books shall be kept on actual basis and double entry system of accounting.

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