Last updated: December 14th, 2021 4:33 PM

Guidelines for Conducting Extraordinary General Meeting by VC/OAVM

The Ministry of Corporate Affairs vides a General Circular No. 20/2021 dated 08.12.2021 has extended the timeline for allowing companies to conduct their Extraordinary General Meeting (EGM) through Video Conferencing (VC) or Other Audio-Visual Means(OAVM) up to 30^th June 2022. The present article tries to clear up the basic provisions relating to conducting the Extraordinary General Meeting by VC/OAVM

The Gist of MCA Circular

MCA has decided to allow companies to conduct their Extraordinary General Meeting (EGM) through Video Conferencing (VC) or Other Audio-Visual Means (OAVM) or transact items through the postal ballot up to 31st December 2021.

Extraordinary General Meeting (EGM)

An extraordinary general meeting (EGM), is a meeting of members of an organization, shareholders of a company, or employees of an official body that occurs at an irregular time. An extraordinary general meeting (EGM) is a shareholder meeting called other than a company’s scheduled Annual General Meeting (AGM).

• The extraordinary general meeting is utilized to deal with urgent matters that come up between annual shareholders' meetings.
• EGMs are often considered for emergency measures such as resolving an immediate legal matter or the removal of a key manager.

For More Details on Extraordinary General Meeting, click here

Basic Provisions Relating to the Conducting EGM

Section 100 of the Companies Act, 2013 read with rule 17 of the Companies (Management and Administration) Rules, 2014 deals with the matters related to convening of Extra-ordinary General Meeting (EGM) Ministry of Corporate Affairs (the MCA) has now allowed companies to hold Extraordinary General Meeting (AGM) through video conferencing (VC) or other audiovisual means (OAVM).

Summing up Various Circulars already Issued

General Circular No. 14/2020 dated 8.04.2021 MCA had allowed the listed companies or companies with 1,000 shareholders or more that are required to provide e-voting facility under the Companies Act, 2013 to conduct EGM through VC/ OAVM and e-Voting.  For other companies, a highly simplified mechanism for voting through registered emails had been put in place for easy compliance. General Circular No. 17/2020 dated 13.04.2021 MCA had issued another Circular (General Circular Number 17/2020) to provide greater clarity regarding the issue of notices to members for EGM through VC/ OAVM using only electronic means. General Circular No. 22/2020 dated 15.06.2021 With this Circular MCA has allowed companies to conduct Extraordinary General meetings (EGM) through Video Conferencing (VC) or Other Audio-Visual Means(OAVM) up to 30^th September 2020. General Circular No. 39/2020 dated 31.12.2021 Vide this Circular MCA has extended the time period for Companies to hold EGMs through Video Conferencing (VC) or Other Audio-Visual Means (OAVM) or transact business through postal ballots from 31^st December 2020 to 30^th June 2021 General Circular No. 10/2021 dated 23.06.2021 MCA has decided to allow companies to conduct their EGMs through VC or OAVM in accordance with the framework provided in the aforesaid Circulars up to 31st December 2021

Conducting of EGM by VC/OAVM

The MCA has released detailed guidelines for conducting an EGM based on the following categories:

• For companies that need to provide an e-voting facility or have opted for e-voting.(As per section 108 of the Companies Act, 2013 read along with Rule 20 of the Companies (Management and Administration) Rules 2014, every listed company and company not having less than 1000 shareholders must mandatorily provide e-voting facility )
• For companies that do not need to provide e-voting facilities.

The Procedure of Conducting EGM by VC /OAVM With E-voting

The Procedure of Holding Extraordinary General Meeting (EGM) through Video Conferencing (VC) or Other Audio-Visual Means (OAVM) For Companies mandatory opted for providing e-voting facility is explained below:

Mode of Conducting EGM

EGMs, wherever unavoidable, may be conducted through video conferencing (VC) or other audio-visual means (OAVM). The company needs to ensure that the facility allows two-way teleconferencing or Webex. Note: Before scheduling the meeting, the company shall keep in mind the convenience of different persons positioned in different time zones.

Notice of the Meeting

The notice of the meeting through VC/OAVM shall contain the following:

• Disclosures in regards to the framework available to the members as per the circular;
• Clear instructions on how to access and participate in the meeting;
• Helpline number to assist shareholders regarding the use of the technology before or during the meeting

A copy of the notice needs to be prominently displayed on the website of the company and also duly intimated to the stock exchanges, in the case of a listed company. In case a notice of the meeting has been served prior to the circular, the company may adopt the framework provided in the circular by obtaining consent from members as per Section 101(1) of the Companies Act, 2013 and issuing a fresh notice of shorter duration with requisite disclosures and information.

Appointment of Proxies

The facility of appointment of proxies by the members shall not be provided under this facility as there is no need for physical attendance of members. However, this shall not be applicable to members under Section 112 and Section 113 which means that they can appoint representatives for the purpose of voting and participation in the meeting.

Selection of Members to Participate in EGM

The facility shall allow at least 1000 members to participate in the meeting on first-cum-first basis. The following may be allowed to attend the meeting without following the first-cum-first rule:

• Shareholders holding 2% or more shares
• Promoters
• Institutional Investors
• Directors
• Key Managerial Personnel
• Chairpersons of Audit Committee
• Chairpersons of Nomination and Remuneration Committee
• Chairpersons of Stakeholder Relationship Committee
• Auditors

Note:

• The Company shall ensure that the meeting via VC/OAVM allows participants to raise questions immediately.
• Also, Company can give time to participants to submit their questions in advance on the e-mail address of the company.

Facility for Joining the AGM

The facility to join the meeting needs to be open for 15 minutes before the scheduled time to start the meeting and closes after the expiry of 15 minutes after the start of the meeting.

Appointment of Chairman

The chairperson shall be as per Article of Association. If such Chairperson is not available the Chairperson for the meeting shall be appointed in the following manner:

• If there are less than 50 members present at the meeting, the Chairperson shall be appointed in accordance with Section 104 of the Act;
• In all other cases, the Chairperson shall be appointed by e-voting.

Quorum

Attendance of members through VC/OAVM shall be counted for the purpose of reckoning quorum as per Section 103 of the Companies Act, 2013.

Remote e-voting

The company shall provide the facility of remote e-voting, before the actual date of the meeting, in accordance with the Companies Act, 2013 and applicable rules.

Voting during the meeting

The voting during the meeting shall be conducted in the following manner:

• Members present at the meeting is less than 50:
• Voting may be conducted through e-voting or show of hands.
• In case of demand for the poll, the voting shall be done by e-voting.

Procedure for conducting voting by-poll

• Members are eligible to vote at the meeting through VC/OAVM
• Only those members, who are present in the meeting through VC/OAVM and have not cast their vote through remote e-voting and are not barred from voting, shall be allowed to vote at the meeting.

Transcripts

Recorded transcripts of such meetings shall be maintained in the safe custody of the company. In the case of a public company, such transcripts shall also be made available on the website of the company.

Filing of resolutions with ROC

All resolutions passed in accordance with this mechanism shall be filed with the Registrar of Companies (ROC) within 60 days of the meeting.

• Compliance with other provisions related to general meetings
• The Company shall ensure that all other compliances associated with the provisions of general meetings viz making of disclosures, an inspection of related documents by members, or authorization for voting by bodies corporate and the articles of association shall be made through electronic mode.

The Procedure of Conducting EGM by VC /OAVM Without E-voting

The Procedure of Holding Extraordinary General Meeting (AGM) through Video Conferencing (VC) or Other Audio-Visual Means (OAVM) For Companies where e-voting is not required is explained below:

Selection of Members to Participate in EGM

The facility shall allow at least 500 members or members equal to the total number of members of the company, to participate in the meeting on first-cum-first basis.

• Appointment of Chairman
• The chairperson shall be as per AOA.

If such Chairperson is not available the Chairperson for the meeting shall be appointed in the following manner:

• Where there are less than 50 members present at the meeting, the Chairperson shall be appointed in accordance with Section 104 of the Act;
• In all other cases, the Chairperson shall be appointed through e-mail.

Voting During the meeting

The voting during the meeting shall be conducted in the following manner:

• Members present at the meeting are less than 50, Voting may be conducted through e-voting or show of hands.
• In case of demand for a poll, the voting shall be done by e-mail.
• In all other cases, Voting shall be conducted by-poll.

Procedure for conducting voting by-poll

• The poll will take place by way of email given by the company.
• The company shall provide a designated email address to all members at the time of sending the notice of meeting;
• The confidentiality of the password and other privacy issues associated with the designated email address shall be strictly maintained by the company at all times;
• Due safeguards concerning the authenticity of an email address(es) and other details of the members shall also be taken by the company;
• During the meeting, where a poll on any item is required, the members shall cast their vote on the resolutions only by sending emails through their email addresses which are registered with the
• company. The said emails shall only be sent to the designated email address circulated by the company in advance;
• In case the counting of votes requires time, the said meeting may be adjourned and called later to declare the result.
• Members eligible to vote at the meeting through VC/OAVM
• All members who have joined the meeting through VC/OAVM shall be eligible to vote at the meeting.

All other conditions/requirements specified above under the topics “Mode of conducting EGM, Notice of the Meeting, Proxy,  Selection of Members to Participate in EGM, Quorum, Procedure for conducting voting by-poll, Transcripts, Filing of resolutions with ROC and Filing of resolutions with ROC” are applicable to conduct AGM  For Companies where e-voting is not required.