Distinguish between the following.
1) Shareholders’ Meeting and Board Meeting
Ans:-
Sr. No. | Points | Shareholders’ Meeting | Board Meeting | |
1) | Meaning | A meeting of all the shareholders or members of the company is called a shareholders meeting. | A meeting of all the Directors of the company is called a Board meeting. | |
2) | How many times | Annual General Meeting is held once in every year. Extra ordinary general meeting is held to discuss and decide special or urgent matters as and when required. | Minimum 4 board meetings in a year and gap between two consecutive meetings should not be more than 120 days. | |
3) | Quorum | The quorum for a shareholders meeting is as follows A) In case of public company | The quorum for a Board meeting is minimum 2 directors or 1/3 of the total number of directors whichever is higher. | |
| Number of shareholder Quorum | |||
Not more than 1000 5 members | ||||
More than 1000 but 15 members up to 5000 | ||||
Exceeds 5000 30 members | ||||
B) In case of private company two members personally present shall be the quorum for meeting of the company. | ||||
4) | Proxy | A shareholder can appoint a proxy to attend and vote at meeting on his / her behalf. | A Director cannot appoint proxy to attend and vote in a meeting on his / her behalf. | |
5) | Notice | A notice of this meeting must be sent to all the members at least 21 clear days before the meeting. | The notice of Board meeting must be sent to every Director at least 7 days before the meeting. | |
6) | Purpose | The purpose of this meeting is to take approval of shareholders on certain matters like appointment of Director and Auditor, approval of Annual Report etc. | The purpose of this meeting is to discuss the policy matters of the company like issue of shares, calls on shares, forfeiture of shares, appointment of staff, expansion of business etc. | |
2) Annual General Meeting and Extra ordinary General Meeting.
Ans:-
Sr. No. | Points | Annual General Meeting | Extra ordinary General Meeting | |
1) | Meaning | A meeting of all shareholders held once in every year as per the provision of Section 96 of the companies Act 2013 is called as Annual General Meeting | A meeting of all shareholders held to discuss and decide urgent matters as per the provision of Section 100 of the Companies Act 2013 is called as extra ordinary general meeting | |
2) | Purpose | The purpose of this meeting is to review the progress made by the company during the year. | The purpose of this meeting is to discuss and decide urgent and special matters. | |
3) | Time of holding | The first Annual General Meeting is held within 9 month after the completion of first financial year of the company and subsequent Annual General Meeting is held within 6 months after the completion of financial year. | Extra Ordinary General Meeting is held at any time between two Annual General Meetings. | |
4) | Authority to call the meeting | Annual General Meeting is usually called by the Board of Directors or under certain circumstances by the Central Government. | Extr by A) B) | a ordinary general meeting is called Board of Directors Board of directors on requisition of members |
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| C) | The National Company Law Tribunal. |
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| D) | Requisitionist themselves. |
5) | Business transacted | This Meeting is held A) To approve annual accounts B) To approve Auditor’s and Directors’ Report C) To appoint directors, auditors D) To declare dividend | This Meeting is held to discuss matters like A) To alter Memorandum of Association. B) To alter Articles of Association C) Removal of a director before expiry of his / her term D) Voluntary winding up of a company | |
6) | Penalty | In case of default in holding this meeting, every officer concerned is punishable with a fine ` 1,00,000 and a further a fine of ` 5000 per day till the default continues. | If the directors fail to hold this meeting on requisition, the requisitionists themselves can hold it and recover the expense of holding such meeting from the company. | |