2020 (3) TMI 1355 - Tri - Companies Law

Sanction of scheme of amalgamation - seeking direction for convening of an Annual General Meeting and for other consequential reliefs - Section 96 of the Companies Act, 2013 - HELD THAT - In the event of default in holding the Annual General Meeting of a company under Section 96, this Tribunal is empowered under Section 97 of the Companies Act, 2013, for issuance of a direction for calling of an Annual General Meeting - Respondent Nos.2 and 3, who are the Directors of respondent No.1- company have not denied the mandatory obligation of respondent No.1- company to hold the Annual General Meeting within the prescribed period. In view of the mandatory requirement under the provisions of the Companies Act, 2013 and in view of the paramount interest of the company, as also the submissions made on behalf of both sides, it is considered fit case of exercising the powers conferred under Section 97 of the Companies Act, 2013 - Respondent Nos.1 to 3 to convene, hold and conduct the Annual General Meeting within 30 days from today on any working day during business hours i.e. 9 AM to 6 PM, at the registered office of the respondent No.1-company at Gurugram, after duly certifying strict compliances of the procedures as contemplated under the Articles of Association of the company and the Companies Act, 2013. Application allowed.

Summary

Issues:
1. Petition under Section 97 of the Companies Act, 2013 seeking direction for convening of an Annual General Meeting.
2. Dispute regarding authority of the Authorized Representative of the petitioner-company.
3. Allegations of preventing respondent Directors from functioning and conducting Annual General Meeting.
4. Interpretation of Sections 96 and 97 of the Companies Act, 2013.

Analysis:
1. The petitioner, a broadcasting company, filed a petition seeking direction for convening an Annual General Meeting (AGM) under Section 97 of the Companies Act, 2013. The respondent company, promoted by former shareholders of the petitioner, failed to hold the AGM within the prescribed time, leading to the petition.

2. Respondent Directors disputed the authority of the petitioner's Authorized Representative to file the petition. Despite their contentions, a related application was dismissed, allowing the petition to proceed based on the AGM issue without revisiting the representative's authority.

3. The respondent Directors argued that they were prevented from conducting the AGM due to alleged hostile actions by the petitioner's representatives. However, as they did not contest the legal obligation to hold the AGM, the Tribunal focused solely on the directive for convening the meeting without delving into other disputes.

4. The Tribunal referred to Sections 96 and 97 of the Companies Act, 2013, emphasizing the mandatory nature of holding AGMs and the Tribunal's power to intervene in case of default. Considering the paramount interest of the company and the legal requirements, the Tribunal allowed the petition and directed the respondent company to hold the AGM within 30 days, ensuring compliance with all procedures and maintaining peace during the meeting.

By analyzing the issues and legal provisions involved, the Tribunal's judgment underscored the significance of upholding statutory obligations and ensuring proper corporate governance practices, ultimately resolving the dispute over the Annual General Meeting through a clear directive.