• Notification Date: 10-12-2021
• Notification No: 79/2021-22

MCA notified no further extension for holding AGMs

The Ministry of Corporate Affairs (MCA) on Wednesday clarified that deadline for holding annual general meetings (AGMs) due in current year (2021) will not be extended further. The deadline to conduct AGMs ended on November 30.

However, it has decided to allow companies to hold their AGMs through video conferencing or other audio-visual modes till June 30, 2022, given the threat imposed by the new variant. The said extension will also be applicable on extraordinary general meetings (EGMs), in case of any special resolution.

“The circular shall not be construed as conferring any extension of time for holding of AGMs by the companies under the Companies Act, ministry said in a circular. Added that the companies which have not adhered to the relevant timelines shall be liable to legal action under the said Act.

Expert explained that the companies who have failed to comply will be considered as defaulter unless they have sought some exemption which is allowed up to three months from the time of deadline.

“This circular is not to be considered as providing any further extension to hold AGMs, the companies shall still be considered defaulting and would need to go for compounding, said Sumit Naib, director, Nangia Andersen India. He pointed out that the option should have also been given to companies whose AGM fall due in 2022.

Due to second wave and consequent restrictions, the ministry had extended the time by two months beyond September for companies to conduct their AGM for the fiscal year ended March 2021.

As per the Companies Act, 2013, a company must hold its AGM within a period of six months from the end of the financial year. However, in the case of a first annual general meeting, the company can hold the AGM in less than nine months from the end of the first financial year.