Can the AGM of a private company be held at any place

[Sitaram]

Hi everybody,

 

I am of the opinion that the AGM of a private co. which is not a subsidiary of a public company can be held at anywhere.

 

I explain as follows:

 

Section 166(2)

 

(2) Every annual general meeting shall be called for a time during business hours, on a day that is not a public holiday, and shall be held either at the registered office of the company or at some other place within the city, town or village in which the registered office of the company is situate:

 

Provided that the Central Government may exempt any class of companies for the provisions of this sub-section subject to such conditions as it may impose:

 

Provided further that -

 

(a) a public company or a private company which is a subsidiary of a public company

may by its articles fix the time for its annual general meetings and also by a resolution passed in one annual general meeting fix the time for its subsequent annual general meetings; and

 

(b) a private company which is not a subsidiary of a public company, may in like manner and also by a resolution agreed to by all the members thereof, fix the times as well as the place for its annual general meeting.

 

Section 116(2) speaks about the condition that the AGM shall be held at the registered office of the company or at some other place within the city, town or village……………..

 

The subsection contains two provisios:

 

(a)    which refers to the time of AGM of a public company

(b)   which refers to the time and place of the AGM of a private company which is not a subsidiary of a public company.

 

Reading sub-section (2) in tandem with provisio (b) it gives an impression that the AGM of a company shall be held either at the registered office of the company or at some other place within the city, town or village in which the registered office of the company is situate, but this shall not apply to a private company, as provisio (b) states that the company can fix the place for the AGM.

 

Another argument that I set out is that sub-section (2) of section 166 uses the words “company” whereas provisio (b) uses the term “private company”. In my opinion, the term “company” is general and the term “private company” is specific.

There is a rule in interpretation of statutes which says that specific provision overrides a general provision.

 

Thus, I am of the opinion that a private company can fix the place of the AGM and that place can be “anywhere”. This is further substantiated by the fact that provisio (a) with regard to public company making a reference only to the time of the AGM and not the place. Sub-section (2) of Section 166 is only with respect to a public company and a private company which is a subsidiary of a public company.

 

Will be glad if anyone proves me wrong.

 

Regards,

Sitaram

9008407656

[csarengarajan]

Dear member

 

You have to read the proviso as well as sub section (2) of section 166 together not in isolation.  The company includes private company also.  Kindly read the Section 166 (2)    shall be held either at the registered office  or at some other place  within the city, town  or village in whcih the registered office of the company is situate.

 

a private company  which is not a  subsidiary  of a public  company may like  manner  and also by a resolution agreed to by all  members thereof,fix the time as well as  place for its annual general meeting.

 

The interpretation of the section is very important. Proviso as well as section has to be read together not in isolation. There is no exemption of private company to hold its annual general meeting anywhere  and either at registered office or at some other place within the city, town or village in which the registered office of the company is situate.

 

Contrary views are solicited.

 

regards

 

[Jayashree Chandrasekaran]

Hi all,

The choice given to the private company not being a subsidiary of a public company is only to fix the place and time in advance and that does not allow it to hold the AGM outside the limits of the Registered office.

Jayashree

 

On 8/8/09, Sitaram <sita...@gmail.com> wrote:

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[Vivek Hegde]

Yes i agree with the above views. Restriction to hold AGM at the place where RO situate os applicable to Private Cos also.

 

rgds

 

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