Egm without board meeting

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Arjun G.

DEF

48 Points Posted on 10 August 2016

Dear Experts,

I am well aware that under the Companies Act, 2013, section 100 provides that the Board may call an extraordinary general meeting.

Now considering both the drafting of the said section and practicalities, I am keen to consider that if the Board "may" call an EGM, when all members of a company are in a room, no provision under the Act prevents them from holding an EGM that has not been convened by the Board itself. After all, section 100 does not say that an EGM has to be convened by the Board, only that the Board may call for it.

On a more practical note, this would be at least required whenever the whole Board has rendered its resignation or when, for some reasons, directors of a company are not available to call for an EGM.

Do you agree with such view?

Thank you very much in advance.

Replies (2)

P C Agrawal

Registered independent director Past Ch

5233 Points Posted on 11 August 2016

All members sitting in a room cannot constitute a valid "meeting" under the Act. For a valid meeting there has to be proper notice and agenda. Pl refer Clause 1.1 of Secretarial Standard-2 which is mandatory for all companies. The Board "may" whenever deemed fit, call a meeting. The Board "shall" on the requisition of required number of members, call a meeting, failing which requisitionists may themselves call the meeting as per provisions. In some cases NCLT is authorised to call meetings of members u/s 98.