Every type of company, must once in a year hold an annual general meeting as per Section 166 of the Companies Act, 1956. Not more than 15 months must elapse between the date of one annual general meeting and that of the next.
However, a company may hold its first annual general meeting within 18 months from the date of its incorporation. In such a case, it need not hold any annual general meeting in the year of its incorporation as well as in the following year.
In the case there is any difficulty in holding any annual general meeting (except the first annual meeting), the Registrar may, for any special reasons shown, grant an extension of time for holding the meeting by a period not exceeding 3 months provided the application for the purpose is made before the due date of the annual general meeting. Generally delay in the completion of the audit of the annual accounts of the company is not treated as "special reason" for granting extension of time for holding its annual general meeting. In such circumstances, an AGM is convened and held at the proper time and all matters other than the accounts are discussed. All other resolutions are passed and the meeting is adjourned to a later date for discussing the final accounts of the company. However, the adjourned meeting must be held before the last day of holding the AGM
In case of default in holding an annual general meeting, the following are the consequences :Power of the Central Government : Any member of the company may apply to the Central Government. The Central Government may call, or direct the calling of the meeting, and give such ancillary or consequential directions as it may consider expedient in relation to the calling, holding and conducting of the meeting. A meeting held in pursuance of this order will be deemed to be an annual general meeting of the company.
Penalty in case of default- Fine which may extend to Rs. 50,000 on the company and every officer of the company who is in default may be levied and for continuing default, with a further fine of Rs. 2500 per day during which the default continues may be levied
