Extra- ordinary General Meeting( EGM) under the Companies Act, 2013
Introduction
There are two kinds of business that can be transacted at an Annual General Meeting(AGM) - Ordinary Business and Special Business.
Sometimes there arises matters that need immediate consideration of members and its not possible to wait until next AGM. In such cases, to meet such emergencies, emergency meetings know as Extra- ordinary General Meeting (EGM)are conducted. All business transacted at EGM are Special Business.
Who may call Extra-ordinary general meeting
EGM can be convened by anyone of the following:
i) Board of directors
ii) Any director or any two members
iii) Requisitionist
iv) National Company Law Tribunal (NCLT)
Calling of EGM by Board of directors (BOD) - The Board of Directors may call an Extra-ordinary General Meeting whenever it thinks fit.
In fact, any general meeting of the company can be called only on the authority of a Board Resolution. If the manager, managing director or some other officer calls a meeting without the authority of Board of Directors, it will not be effective unless BOD ratifies the convening of such meeting.
Calling of EGM by director or any two members- Where at any time, there are not any directors whithin India capable of acting who are sufficient in number to form a quorum, any one director or any two members of the company may call for extra- ordinary general meeting.
Calling of EGM on requisition- By requisition we mean the demand of members to convene a meeting.
Condition to be fulfilled for requisition-
a) the requisite must be in plenty
b) it shall set out the matters for the consideration of which the meeting is to be called
c) it has to be signed by Requisitionists.
d) it must be deposited at the registered offfice of the company.
Number of members entitled to requisition in a meeting-
a) in the case of a company with share capital, members holding at least 1/10 of such paid up capital of the company which carries a voting right in regard to the matter
b) in case of a company having no share capital, members holding at least 1/10 of total voting power of all members who have voting right regarding such matter.
On receipt of requisition, the Board of Directors shall proceed to call EGM within 21 days from the date of deposition of requisition, on a date, which shall not be later than 45 days of the date of deposit of requisition. The BOD will be said to have failed in calling an EGM if the above conditions are not fulfilled and if matters discussed in the meeting is not as per the business specified in the requisition.
In case, BOD fails to call a meeting, the meeting may be called by the requisitionists within a period of 3 months from the date of deposition of requisition.
Reasonable exprenses incurred for calling such meeting by requisitionists shall be reimbursed to them by the company from the fees or other renumeration payable to such directors by deducting from their fees.
Calling of EGM by National Company Law Tribunal ( NCLT)- Due to any reason, if its impractical to call meeting of a company, the National Company Law Tribunal may order a meeting of the company to be called, convened or held in such manner as it thinks fit. One member of the company who may be present in person or proxy shall be deemed to constitute a meeting. NCLT may do so on getting an application from any director of member of the company entitled to vote or on its own motion.
