What is AGM (Annual General Meeting)?
The Annual General Meeting is a mandatory meeting of shareholders of a company under Section 96 of the Companies Act 2013. Private Limited companies must hold their AGM within 6 months of the end of the financial year (by 30 September for 31 March year-end companies). At the AGM, shareholders approve accounts, declare dividends, appoint/reappoint auditors, and elect directors.
Example
A Private Limited company with FY 2024-25 ending 31 March 2025 must hold its AGM by 30 September 2025. Failure to hold the AGM results in a penalty of INR 1 lakh on the company and INR 1 lakh on each defaulting officer, with an additional INR 5,000 per day of continuing default.
How AGM (Annual General Meeting) works in India
The AGM is the annual meeting where shareholders exercise governance over the company. Under Section 96 of the Companies Act 2013, every company (except a One Person Company) must hold an AGM each financial year.
**First AGM:** A company must hold its first AGM within 9 months of the end of the first financial year.
**Subsequent AGMs:** Within 6 months of the financial year end, with a maximum gap of 15 months between two AGMs.
**Standard AGM business**
1. Adoption of audited financial statements and Director's Report 2. Declaration of final dividend (if any) 3. Appointment/re-appointment of directors retiring by rotation 4. Ratification/appointment of statutory auditor and fixing remuneration 5. Any special business (bonus issue, amendment to MOA/AOA, related-party transactions)
**Notice requirements**
- 21 clear days' notice to shareholders - Can be shorter with consent of 95% of shareholders (for private companies, all shareholders)
**Quorum**
- 2 members personally present for companies with up to 1,000 members
**Resolution types**
- Ordinary resolution: simple majority of votes cast - Special resolution: 3/4 majority (required for alteration of MoA/AoA, voluntary winding up, buy-back of shares)
**Virtual/hybrid AGMs**
Post-COVID, the MCA has extended provisions allowing companies to hold AGMs via video conferencing. Private Limited companies can hold AGMs electronically with all members' consent.
**After the AGM**
- File Form AOC-4 (financial statements) within 30 days - File Form MGT-7 (annual return) within 60 days - File Form ADT-1 (auditor appointment) within 15 days if auditor appointed/reappointed
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