By Anika Mardiah Chowdhury

It is essential to hold meetings of the Company regularly for running the affairs of the company. There are several types of meetings which must be held yearly and quarterly basis. In this article, the annual general meeting and board meeting will be discussed broadly.

Firstly, the annual general meeting of a company is required to be held once every calendar year. The meeting is attended by the members of the company. In other words, this meeting is the mandatory yearly gathering between shareholders and directors. It is to be mentioned that a company’s first annual meeting must be held within sixteen months from the date of incorporation. Section 18 of the Companies Act, 1994 states that it must not be more than fifteen months elapse from the date of one annual general meeting to that of the next year. There must be one meeting held each year.

Notice, twenty-one (21) days notice shall be given in writing stating the time, place & agenda. A shorter time of notice shall be sufficient if all the members so agreed in writing entitled to attend and vote so agreed in writing. The notice must send by hand or by ordinary post or any other post or e-mail. Where there is no possible way then notice can be served in a newspaper having wide circulation at least seven days before the meeting. In case of companies having a website then such notice shall simultaneously be hosted on the website.

The board of directors call the general meeting after the closing financial year and discharge all other function as mentioned in the Companies Act, 1994. Notice shall specify the nature of the Meeting and it is to be mentioned that in the notice the object or purpose of the meeting must be stated as in the case of Young vs. Ladies’ Imperial Club [1920] 2 KB 523 it was held that as the notice of a meeting did not state the object of the meeting with sufficient particularity it was invalid and consequently the proceedings of that meeting were invalidated.

A quorum must be present throughout the Meeting and no business should be transacted when the Quorum is not so present. The quorum of a meeting is at least two members and in public companies, at least five members must be present there.

Documents, the minutes of the previous year’s AGM must be presented and approved.Then, its annual financial statements and audit report along with directors’ reports and others.

Conducting a General Meeting, the meeting shall convene by the Chairman of the board if any director is unable to attend the meeting, the Chairman shall explain such absence at the Meeting. The Chairman shall conduct the meeting fairly and impartially. The Chairman shall regulate how voting is conducted at the meeting keeping regard to the provisions of the Companies Act, 1994. The Chairman shall explain the objective and implications of the resolutions before they are put to vote at the meeting. Also, shall provide a fair opportunity to members and provide an e-voting facility to their members to exercise their voting rights if the company has its equity shares listed on a recognized stock exchange.

A member may give his vote either personally or by proxy. Schedule I of the Companies Act, 1994 provides the form for the appointment of a proxy which shall be signed by the member and if the member is a corporation or a company it shall be executed either under seal or under the hands of an officer or by duly appointed attorney and the executed instrument should be deposited at the registered office of the company within forty-eight hours before commencement of the meeting. Whereas in United Western Bank Ltd (2002) 3 Comp LJ 247 (CLB) it was held that a proxy cannot be a company as a company, being an artificial entity cannot be present, vote or speak in a meeting. Therefore, a company cannot be appointed as a proxy.

After the voting, the scrutinizer shall submit a report on the total number of votes in favour or against the resolution and submit the same to the Chairman and this result shall be displayed for at least three days on the notice board of the Company at its Registered Office, Corporate Office and Head Office and shall be posted on the website of the Company.

Secondly, Board meetings are conducted to approve statutory requirements as well as approving resolutions for the affairs of the Company. The Secretary or a director of a company has the power to call board meetings. For the effective function of the company, the board meeting plays a very important role.

According to section 96 of the Companies Act, 1994 every company meeting of its Board of Directors shall be held at least once every three months and at least four such meetings shall be held every year.

Notice of Board Meeting, as per section 95 of the following Act notice of every meeting of the Board of Directors of a company shall be given in writing to every director for the time being in Bangladesh and at his address in Bangladesh. The notice informs the members about the venue, date, time, and agenda of the meeting. All types of companies are required to give notice at least seven days before the actual day of the meeting.

Passing Resolution, the board of directors can exercise the following powers by passing a resolution in the meetings of the board, for example, making calls to shareholders, authorizing the securities and shares, issuing securities and shares, approving the financial statement and others. It

In Case of failure to hold a meeting: it is to be mentioned that if any default is made in holding the meeting, the company and every officer of the company who is in default shall be punishable under section 81 of the Companies Act, 1994 with fine which may extend to ten thousand taka and in a case of continuing the default it will be two hundred fifty taka every day after the first day during such default continues.

If any company fails to hold a meeting and an application for condoning the delay in holding the meeting is made before the High Court Division under Section 81(2) of the following Act; the court after perusing the merits of the case may allow or reject the application. If the Court finds a prima facie case and thus admits the application, then the Court shall give direction to the petitioner to publish the notice of the application in two national newspapers within the stipulated time as prescribed by this Court. On the other hand, if the court finds merit after hearing the learned Advocate for the Petitioner and allows the application in such case, the court will give direction to the RJSC to accept all fillings and returns accordingly if required further imposed fine on the Petitioner company. However, the Directors shall not be in any case be exempted from the responsibility of holding the general meeting.

From the Companies Act, 1994 it is not clear whether the penalty for failing to hold a meeting apply to all meeting or specific types. Hence in the case of Mostofa Jamal Mohiuddin v Magura Paper Mills and others [2013] HCD [2014] LNJ 248. The wording of section 85(3) does not refer to Annual General Meeting or Board meeting, rather it refers to ‘a meeting’ of the company, which has become impracticable to be conducted in the manner as laid down in the Articles of Association and the expression ‘a meeting’ is wide enough to cover an AGM, and EGM or a Board meeting, as the case be. Also this observation of Md. Rezaul Hasan J was affirmed by the Appellate Division of the Supreme Court of Bangladesh in the case of Md. Rafiqul Islam Vs. Mostofa Jamal  [2014] AD [2017] 2 ALR (AD) 2017 300 where it held that held “This very section 85 is very much clear that the provisions provided in this section are with respect to all meetings, namely, annual general meeting, board meeting and other meetings”.

In conclusion, it can be said that the Companies Act, 1994 clearly recognize the importance of holding meetings either general or board meeting.

Leave a Reply

Your email address will not be published. Required fields are marked *

eight + 8 =

Verified by MonsterInsights