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2020 (9) TMI 441 - Tri - Companies LawNon-conduct of Annual General Meeting - fulfilment of mandatory legal obligation to conduct the Annual General Meeting of respondent No.1-company - 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, we consider that this is a fit case of exercising the powers conferred under Section 97 of the Companies Act, 2013 - Respondent Nos.1 to 3 directed 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.
Issues:
1. Non-conducting of Annual General Meeting by respondent No.1-company within the prescribed time under the Companies Act, 2013. Analysis: The judgment by the National Company Law Tribunal, Chandigarh Bench, involved a petition filed by M/s Associated Broadcasting Private Limited (ABPL) seeking direction for TV9 Kolkata Private Limited, respondent No.1, to convene an Annual General Meeting and other related reliefs under Section 97 of the Companies Act, 2013. The petitioner highlighted that despite holding 99.90% shareholding in respondent No.1-company, along with another shareholder holding 0.10% shareholding, the Directors of respondent No.1 failed to hold the Annual General Meeting within the mandated time frame. Respondent Nos.2 and 3, the Directors of respondent No.1, disputed the authority of the petitioner's Authorized Representative to file the petition, but their contentions were dismissed by the Tribunal. Respondent Nos.2 and 3 also raised allegations of hostile behavior and threats from the petitioner's side, which were denied. However, the Tribunal focused on the primary issue of non-conducting of the Annual General Meeting and the legal obligations under the Companies Act, 2013. The Tribunal referred to Section 96 of the Companies Act, 2013, which mandates the holding of an Annual General Meeting within the specified time frame. In case of default, Section 97 empowers the Tribunal to issue directions for calling the Annual General Meeting. Respondent Nos.2 and 3 did not contest the obligation to hold the meeting within the prescribed period. Considering the legal requirements and the paramount interest of the company, the Tribunal found it appropriate to exercise its powers under Section 97. Consequently, the Tribunal directed respondent Nos.1 to 3 to convene, hold, and conduct the Annual General Meeting within 30 days from the judgment date, ensuring strict compliance with procedures as per the Articles of Association and the Companies Act, 2013. The Tribunal also specified that one member present in person or by proxy would constitute the quorum and emphasized maintaining peace and harmony during the meeting. Moreover, in response to apprehensions expressed by respondent Nos.2 and 3, the Tribunal directed the Regional Director, Northern Region, Ministry of Corporate Affairs, to supervise the Annual General Meeting or depute an officer for the same. The Station House Officer was also instructed to facilitate the meeting and maintain peace. These directions aimed to ensure the proper conduct of the Annual General Meeting in compliance with legal requirements and to address any concerns raised during the proceedings. In conclusion, the judgment addressed the core issue of non-compliance with the obligation to hold the Annual General Meeting within the stipulated time frame, emphasizing the legal provisions under the Companies Act, 2013. The Tribunal's directions aimed to enforce the statutory requirements, facilitate the meeting process, and maintain a conducive environment for conducting the company's affairs effectively.
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