Company Meetings

The supreme authority In a company is shareholders because they are owners of the company.

But it is not possible for them to exercise direct control over the management of the company.

That is why the powers of management are vested in the directors.

The shareholders and the directors exercise their powers through the meetings. The creditors and other investors also meet whenever necessary to consider and decide matters their interest.

When is a meeting? Why is it held? Let us discuss it in the following paragraphs.

Definition

“Any gathering, assembly or coming together of two or more persons for the transaction of some lawful business of common concern is called the meeting.”

“Meeting is an assembly of persons, who are authorized to discuss and decide about the business matters of the organization.”

Above definition clearly bring out there the major requirement of a meeting. They are

a)     The meeting is gathering or coming together of persons.

b)    They discuss and decide about the (lawful) business.

c)     They decide about the common interest of the organization for common concern.

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Need or Importance of meeting:

The meetings are held for the following purposes :

a)     To compare with statutory requirement, as holding of certain meeting is compulsory by law

b)    Meetings bring together the members, so that they can express their views on various matters, related to company

c)     Members can approve and adopt:- Annual accounts, Directors Reports, Dividend declared by the directors any contracts and agreements.

d)    Members can appoint:- Directors Auditors Etc.

e)    Members can review the progress of the company,

f)      Members can give their opinion and view on certain policies and plans of the directors.

g)     Members can help directors to solve crucial problems faced by the company.

h)    Members can exercise their voting rights,

i)       Overall aim of the meeting is to decide collectively what, how when the things are to be done.

Essentials of a valid meeting:

For every meeting, there is a certain requirement. Unless they are complied with “No meeting is said to be a valid meeting.” That is why, “A meeting should be, duly convened, property constituted, lawfully conducted and accurately recorded.” Duly convened means proper notice of the meeting is given by ‘proper Authority’.

‘Proper constitution’ means requisite quorum’ present in right time for the meeting and ‘proper authority (person)’ to conduct the proceedings at the meeting.

‘Lawful conduct’ means whatever transactions take place at the meeting like discussion voting, placing of motions passing the resolution etc. must be as per the provisions of the law’

Accurate record means the minutes of the meetings must give true & fair information about the proceedings of the meetings. Even an absent member can be able to understand very well what has happened at a meeting.

Proper convening Authority, Proper Notice, Requisite Quorum, Proper person in chair, Lawful conduct, lawful purpose, Proper Record.

Notice of the Meeting

A notice is a written or an oral statement that contains the particulars of holding a meeting. When a circular is served among the members of the meeting to attend the meeting, it is called a notice. It is a letter of invitation that carries the request to the members to attend a meeting. A notice includes time, place, date and agenda of a meeting. The notice should be sent by the proper authority in due time so that the members can attend the meeting in time.

So, notice is formal written or formal information, notification or warning about a factor an invitation to the concerned person for attending the meeting.

1.     Signature: The notice must be signed by the proper authority. Only the legal authority should serve the notice.

2.     Proper time: The notice must be served in proper time. It should be circulated according to the rules and regulations of the company or the organization.

3.     Time date and place: The time, date and place of the meeting must be stated in the notice.

4.     Unconditional: There must be no condition or complexity in the notice about attending the meeting. Always a notice is unconditional.

5.     Agenda: Agenda means topics to be discussed in a meeting. A valid notice should contain the agenda of the meeting.

6.     Conciseness: The notice must be short in size. It should be clear, simple and easy.

7.     Proper persons: Notice should be served to the proper persons who are entitled to attend the meeting.

A)

SPECIMEN OF NOTICE:

NOTICE OF STATUTORY MEETING OF A COMPANY

ABC Ltd.
xyz road, Mumbai
Date: March 20, 2019

NOTICE FOR STATUTORY MEETING

Notice is hereby given that the statutory meeting of the company will be held on March 30, 2019, at 12 p.m. in the registered office of the company according to the section ……………. Of company Act. 1956.

Concerned shareholders are requested to attend the meeting.
Mr. B

Secretary
On behalf of the board
Of directors.

Notice of the meeting of the board of directors

XYZ Co. Ltd.
ABC Road, Mumbai
Date: March 10, 2019

NOTICE OF THE BOARD OF DIRECTOR’S MEETING

Dear Sir,
Being authorized I am informing you that the second meeting of the Board of Directors will be held at the head office of the company on March 20, 2019, at 10 a.m.

You are duly requested to attend the meeting.

Sincerely yours
MR B
Secretary
Agenda:
1. ……………………………
2…………………………….
3……………………………

To whom a notice is given: A notice of the meeting is given “to all those persons, who are authorized to received if.” That is why in the case of

· General meeting

· To every member of a company

· To the bearers of share warrants

· To the legal representatives of deceased and lunatic members,

· To the official's Receiver appointed by the court, in case of insolvency of a member.

· To the auditors of the company.f

· Board meeting To all the directors and to that person, whom the directors want him to attend the meetings.

· Authority to send a notice: Ordinarily, directors have to call the meeting, that is why the notice of the company meeting is signed and sent by the ‘secretary’ under the name of “By order of the Board of Directors”. If a meeting is to be convened by the officer appointed by the above-mentioned authorities. If a meeting is to be called by the members (especially Extra Ordinary General Meetings) the notice of the meetings is signed and sent by the duly appointed representative of the members on their behalf.

AGENDA OF THE MEETING

Meaning

The literal meaning of the term ‘Agenda’ is “Thing to do ne”. The relevant meaning of the agenda for the company meeting is “things to be at a meeting” The Agenda. Therefore, ‘is the business to be transacted at a meeting.’ It is a practice to send the agenda together with the notice of the meetings or agenda is included in the notice of meeting itself.

The Act makes no provisions for agenda nor it has any legal significance. Still, the agenda has practical importance. Because it enables the meeting to discuss the business matters clearly, explicitly and without omission. The business at the meeting to transacted according to the order in which it appears on the agenda. An arrangement of the matters in the agenda is made in a logical manner. That is routine matters which can be discussed and decided in less time are arranged first in the serial . after that special business or time-consuming matters.

The agenda is prepared by the secretary in consultation with the chairman of the company. Every meeting has its own agenda which all business cannot be transacted at all meetings.

Need/Purpose/Importance of the Agenda:

1) Agenda gives advance intimation to the members about the business that a meeting is going to transact,

2) If any member attending the meeting wants to express his views on a particular business or business can prepare and participate in the discussion.

3) It enables the chairman to conduct the business of the meeting in an orderly manner,

4) It avoids omission of any important matter from the consideration of the meetings.

5) It avoids repetition, confusion, and overlapping of any decision taken at previous meetings.

Guiding Principles of Agenda: (How an agenda should be?)

a) It should be clear and explicit,

b) It should be indicative.

c) Routine matters should be detailed with first on the agenda and matters requiring long debts be arranged later.

d) The items related or of similar character should be placed nearer to each other.

e) All items on the agenda shall be within the scope of the meetings.

f) The agenda should deign within (i.e first item of the agenda) ‘confirmation of the minutes of the previous meeting’ (except in case of the first meeting of the Board of Directors and Statutory General meeting) and end with ‘Any other business with the permission of the chair.’