Background:

As per the provisions of Section 101 (1) of the Companies Act, 2013, every general meeting of a company may be called by giving not less than twenty-one days clear notice in writing or through electronic mode in such manner as provided under Rule 18 of Companies (Management and Administration) Rules 2014.

In the case of private limited companies, the period of notice can either be twenty-one days or such other period as may be provided in their Articles of Association. 

The proviso to Section 101, sub-section(1), provides an exception to the requirement of “Notice Period” with certain conditions to fulfil. 

The Notice of Meeting is a very important and crucial aspect of conducting a proper meeting. This article will help you understand the provisions related to shorter notice consent, its applicability, requirements and procedure on how a company can conduct general meetings with shorter notice.

It is consent/permission obtained by a company from its members, in advance, to call a general meeting at an earlier date than that normally would have been called post issue of notice. 

The Act mandates companies to issue a notice to members calling a general meeting at least 21 days before (in case of private limited companies the period can be less than 21 days as provided in the Articles) the date of the meeting. Sometimes, the matters in urgency require quick decision making and in such circumstances, the companies may go for calling general meetings at shorter notice.

The proviso to Section 101 (1) of the companies Act, 2013 reads as under:

A general meeting may be called after giving shorter notice than that specified in this sub-section if consent, in writing or by electronic mode, is accorded thereto—

(i) in the case of an annual general meeting, by not less than ninety-five per cent. of the members entitled to vote thereat; and

(ii) in the case of any other general meeting, by members of the company—

(a) holding, if the company has a share capital, the majority in number of members entitled to vote and who represent not less than ninety-five per cent. of such part of the paid-up share capital of the company as gives a right to vote at the meeting; or

(b) having, if the company has no share capital, not less than ninety-five per cent. of the total voting power exercisable at that meeting:

Provided further that where any member of a company is entitled to vote only on some resolution or resolutions to be moved at a meeting and not on the others, those members shall be taken into account for the purposes of this sub-section in respect of the former resolution or resolutions and not in respect of the latter.

Can Annual General Meeting (AGM) be called at shorter notice?

Yes, AGM under the Companies Act, 2013  can be called at shorter notice provided that;

The consent in writing or electronic mode is received from not less than ninety-five per cent of the members entitled to vote at the meeting. The number of shares held by each member has no significance here. 

For example: If the company has 100 members entitled to vote at the meeting, then the consent of at least 95 members irrespective of their shareholding, is required to call AGM at shorter notice.

Can Extraordinary General Meeting (EGM) be called at shorter notice?

Yes, Extraordinary GeneralMeeting can be called at shorter notice, provided:

  1. Holding, if the company has a share capital, the majority in number of members entitled to vote and who represent not less than ninety-five per cent. of such part of the paid-up share capital of the company as gives a right to vote at the meeting; or
  2. having, if the company has no share capital, not less than ninety-five per cent. of the total voting power exercisable at that meeting:

What is voting right as per the Companies Act, 2013?

As per Section 2(93) “voting right” means the right of a member of a company to vote in any meeting of the company or by means of postal ballot.

What is total voting power?

As per Section 2(89) “total voting power”, in relation to any matter, means the total number of votes which may be cast in regard to that matter on a poll at a meeting of a company if all the members thereof or their proxies having a right to vote on that matter are present at the meeting and cast their votes.

Can financial statements be circulated/laid in a general meeting called at shorter notice?

The MCA vide General Circular 11/2015 dated July 21. 2015 clarified that the financial statements can be circulated/laid in a general meeting called at a shorter notice, provided that  the provisions specified under Section 101 (1) of the Companies Act, 2013 are complied with.

Yes, a person holding a specific power of attorney may sign the consent of a Member entitled to receive notices, and such consent shall be deemed as the consent of the Member concerned.

Yes, shorter notice consent can be received either in writing or via electronic mode such as email and the same shall be received prior to the time fixed for the meeting.

The request consenting to short Notice shall be sent alongwith the Notice of Meeting. The meeting shall be held only if the consent of 95% of the members entitled to vote at such a meeting is received prior to the time fixed for the meeting. The company shall also comply with the provisions of appointment of proxy.

Can private limited companies hold general meetings at shorter notice?

Yes, private limited companies can hold AGM and EGM at shorter notice. Pursuant to Notification dated 5th June 2015, the private limited companies are exempt from the provisions of Section 101 of the Companies Act, 2013. It means the Articles of Association of the company, may provide for a shorter period for serving notice of General Meeting. 

For shorter notice consents, the Articles may provide for such a number of members as it may deem appropriate. If Articles are silent about notice period for calling general meetings and  number of members consent required for holding general meetings at shorter notice, then the company shall follow provisions specified under Section 101(1) of the Companies Act, 2013.

Format of shorter notice consent for AGM - Annual General Meeting

SHORTER NOTICE CONSENT
[pursuant to provisions of Section 101(1) of the Companies Act, 2013]

To,
The Board of Directors
________________ (Name of the company)
________________ (Address of the company)

Subject: Consent to hold _______ (number) Annual General Meeting at shorter Notice

I/We, ________________ (Name of the shareholder)  son/daughter/wife of ______________, resident of ______________ (Address of the shareholder), holding _______ (Number of Equity/Preference shares) of Rs. ________ each in the company, in my name/joint name, hereby give consent pursuant to provisions of Section 101(1) of the Companies Act, 2013 to hold the ____ (number of AGM) Annual General Meeting of the company scheduled to be held on __________ (date of the AGM) at ____________ (place of the meeting) at _________ (Time of the meeting) at shorter notice.

Signature
Name: __________________
(In block Letters)

Date: the _____ day of ________ (month) 2020

Format of shorter notice consent for EGM- Extraordinary General Meeting

SHORTER NOTICE CONSENT
[pursuant to provisions of Section 101(1) of the Companies Act, 2013]

To,
The Board of Directors
________________ (Name of the company)
________________ (Address of the company)

Subject: Consent to hold Extraordinary General Meeting at shorter Notice

I/We, ________________ (Name of the shareholder)  son/daughter/wife of ______________, resident of ______________ (Address of the shareholder), holding _______ (Number of Equity/Preference shares) of Rs. ________ each in the company, in my name/joint name, hereby give consent pursuant to provisions of Section 101(1) of the Companies act, 2013 to hold the Extraordinary General Meeting of the company scheduled to be held on __________ (date of the EGM) at ____________ (place of the meeting) at _________ (Time of the meeting) at shorter notice.

Signature
Name: __________________ 
(In block Letters)

Date: the _____ day of ________ (month) 2020

Conclusion:

The companies can hold general meetings at shorter notice by obtaining consent from not less than 95% of the members entitled to attend and vote at the meeting. The emphasis shall be on the requirement of “entitled to attend and vote at the meeting” and not on “entitled to vote and present at the meeting” 

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