Companies registered under Companies Act, 1956 or Companies Act, 2013 (‘Companies’) can now conduct their annual general meeting through Video Conferencing (‘VC’) or other Audio-Visual Modes (OAVM) till September 30, 2023. Ministry of Corporate Affairs (‘MCA’) vide its circular dt: December 28, 2022 has granted extension to its earlier circular dt: May 5, 2022, vide which Companies were allowed to conduct AGM through VC or OAVM mode till December 31, 2022.
Link : MCA Circular 10_2022
It needs to be highlighted here that Companies can conduct AGM through VC or OAVM mode only in compliance with provisions mentioned under MCA circular dt: May 5, 2020 read with MCA Circular dt: April 8, 2020 and MCA Circular dt: April 13, 2020.
MCA vide it’s circular dt: May 5, 2020 had initially allowed Companies to conduct AGM through VC or OAVM mode. This was due to onslaught of COVID-19. Vide this circular MCA allowed Companies to conduct AGM through VC or OAVM mode till December 31, 2020.
MCA citing COVID-19 concerns time and again gave extension to provisions of MCA Circular dt: May 5, 2020, vide circular dt: January 13, 2021, and December 14, 2021 thereby allowing Companies to conduct Annual General Meetings through VC or OAVM mode till certain time period. Vide its last extension circular dt: May 5, 2022 MCA allowed Companies to conduct AGM through VC or OAVM mode till December 31, 2022. Now in furtherance to this MCA has vide its circular dt: December 28, 2022 has further granted extension to Companies till September 30, 2023.
It needs to be highlighted here that ‘Report of Company Law Committee, March 2022’ has at Point 8.5 of the report recommended for incorporating provision for conducting AGM through VC or OAVM mode or hybrid mode in Companies Act 2013. So, it needs to be seen whether MCA continues giving extension to MCA circular May 5, 2020 for conducting AGM through VC or OAVM mode till recommendations are incorporated in Companies Act, 2013.
Citing MCA circulars as mentioned above that allowed Companies to conduct AGM through VC or OAVM mode, SEBI has been granting relaxations in compliance with certain provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations, 2015 (‘LODR’). Recently, SEBI vide it’s circular dt: May 13, 2022 and May 16, 2022 granted relaxation in compliance with certain provisions of LODR viz. non-sending of proxy forms, sending of notices and annual report copies through emails etc. These relaxations granted by SEBI will be expiring on December 31, 2022. So now it needs to be seen if SEBI further grants relaxation for compliance with certain provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations, 2015 as MCA has now allowed Companies to conduct AGM through VC or OAVM mode.
Further, also one more point needs to be deliberated i.e. Whether companies who had already sent AGM or EGM or postal ballot notices in December first week for conducting AGM or EGM in physical mode, assuming that relaxations allowed as per MCA circular May 5, 2020 and MCA circular April 8, 2020 read with MCA circular dt: April 13, 2020 would not be continued, can these companies conduct meetings now through VC or OAVM mode as now MCA has now further extended relaxations of conducting meetings through VC or OAVM mode?
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