The Ministry of Corporate Affairs (MCA) has extended the deadline for holding up of annual general meetings (AGMs) for the fiscal year 2020-21 by 2 months, which may provide some relief to businesses, particularly small and medium-sized enterprises. In this blog you know about Companies get 2 months extension to hold AGM for financial year 2020-21.<\/p>\n\n\n\n
The notification is intended for all Regional\nDirectors and Registrar of Companies (RoCs) within the Ministry of\nCorporate Affairs.<\/p>\n\n\n\n
According to Section 96 (1) of the Companies Act of 2013, every company must conduct an Annual General Meeting at least once a year. Every year, within six months of the end of the fiscal year, a firm must conduct an AGM. In the event of a first annual general meeting<\/strong><\/a>, nevertheless, the business might conduct the AGM\u00a0in less than 9 months from the end of the first fiscal year.<\/p>\n\n\n\n As per Section 96 Clause 1 of the Companies Act of 2013<\/strong>[1]<\/strong><\/a><\/sup>, the upcoming Annual General Meeting (AGM)\u00a0must be conducted on the earliest of the following schedule:<\/p>\n\n\n\n Annual General Meetings let shareholders of a\nbusiness entity to express their opinions on the company’s business or\ntransactions. Failure to conduct an Annual General Meeting results in a\npenalty for the company\u2019s directors and the Law Board of the Company has the\nauthority to summon or require an AGM.<\/p>\n\n\n\n The Companies Act, 2013 requires that\nmembers be given 21 days\u2019 notice of an Annual General Meeting (AGM), outlining\nthe meeting’s agenda. However, owing to the COVID-19 epidemic, the MCA\npostponed the meeting. Because to the countrywide lockdown and limit on\npeople\u2019s time, it became impossible for companies to hold their AGMs.\nFurthermore, while having an AGM, social distance standards must be followed.\nAll of these issues made it difficult for corporations to host their Annual\nGeneral Meetings. As a result, MCA issued circulars extending the period for\nholding AGMs in order to alleviate the firms’ circumstances.<\/p>\n\n\n\n The business entities made multiple\nsubmissions to the Ministry of Corporate Affair (MCA) for an extension of\nthe period allowed under the Companies Act, 2013 to\nconduct the AGM for the financial year ending March 31, 2021.<\/p>\n\n\n\n Companies will now have until the end of\nNovember 2021 to convene their Annual General Meetings as a result of this extension\nby the MCA. Companies are obligated by law to hold their AGM within 6\nmonths after the end of the financial year, which is September 30, 2021.<\/p>\n\n\n\n This latest MCA action follows the Ministry\u2019s receipt of submissions requesting an extension of time for the convening of the Financial Year21 Annual General Meeting. The representations were made while both businesses and the audit community were encountering issues as a result of the second wave of Covid-19 pandemic and the resulting lockdowns. While this notification may provide some relief to businesses, particularly small and medium-sized enterprises, some business watchers, however, believed that the 2 months extension was insufficient, considering that pandemic-induced municipal travel restrictions had hindered the audit process in many states. <\/p>\n\n\n\n Circular attached<\/strong><\/p>\n\n\nMCA_extends_timeline_for_holding_AGM_for_the_FY_2020-21