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Shorter Notice for convening General Meeting
Shorter Notice for convening General Meeting - Companies Act 2013 [Section 101(1)]
Shorter Notice may be given to the shareholders of a Company for convening General Meeting be it Annual General Meeting (AGM) or Extra-Ordinary General Meeting (EGM).
Detailed provisions under the Companies Act 2013 are described below.
Standard notice period (minimum):-
Section 101(1) requires at least 21 days’ clear notice to be served on to call a general meeting of shareholders of companies.
Shortened Notice Period:-
Proviso to Section 101(1) allows a Company to hold/call for a shareholders’ meeting in a shorter notice period – i.e. of less than 21 days, provided consent is given in writing or by electronic mode by not less than 95% of the members entitled to vote at such meeting.
It is inadvertent to mention that the consent has to be taken before the meeting begins.
Please click here for a format of the consent letter to be obtained from the shareholders.
Time Limit for calling general meeting with a shorter notice: There is not time limit prescribed such serving of short notice. It can even be done in the same day when the general meeting is to be held.
However, the Articles of Association of a Company may specify a time limit for such shorter notice. Case Laws : (1) In AIR 1928 PC 180 Parashuram Detaram Shamdasani v. Tata Industrial Bank Ltd., it was held that the shareholders knowing the work to be transacted at the meeting and remaining absent cannot subsequently complain about insufficiency of notice for convening the meeting. (2) Shailesh Harilal Shan And Others, ... vs Matushree Textiles Limited And The Learned Judge stated that "In our judgment, the plaintiffs have not suffered any prejudice whatsoever by notice being of only 20 clear days instead of 21 clear days. The share holding of the plaintiffs is extremely negligible being 0.3% and it would be entirely unreasonable to invalidate the business transacted at the Annual General Meeting at the behest of these few shareholders and to the detriment of large body of shareholders who had unanimously approved the resolutions moved at the meetings.