Statutory meeting is the first meeting of the company and is conducted once during the life time of the company.
Companies which can hold such meeting: A company limited by shares and a company limited by guarantee & having share capital are the companies which can hold statutory meeting.
Companies which need not hold the meeting:–
- Private company whether independent or subsidiary of a public company.
- A public company not having share capital
- An unlimited public company.
- A public company limited by guarantee and not having share capital
- A Government company.
Time limit for the meeting:- A statutory meeting may be held within a period of
- Not less than one month.
- Not more than 6 months.
From the date of receiving the certificate of commencement of business.
Notice of the meeting: A minimum of 21 clear days notice is to be given.
Object: The main purpose of the meeting is to enable the members of the company to know at an early date the financial position and the prospects of the company and also to provide them an opportunity to discuss on various matters arising out of promotion and formation of the company.
Importance: this meeting is held only once during the life time of the company and is the first meeting of the company.
What is a statutory meeting and its content: A statutory meeting is a report which is sent to each member along with the notice of the meeting.
Content of statutory report:–
- It sets out the total number of shares allotted and the mode of allotment.
- The total amount of the cash received by the company in respect of the shares allotted.
- An abstract of receipt and payment of the company. This report has to be duly certified by at least two directors. Out of which one shall be a managing director along with auditor of the company.
- Agenda of the meeting regarding the formation and prospects of the company.
- Particulars of directors, auditors, etc.
- Particulars of contract.
- Under writing contract.
- Arrears of call.
- Commission or brokerage.
Adjournment of Statutory meeting: The statutory meeting may be adjourned from time to time according to the provision of the companies Act, 1956 and the power to adjourn vests in the hand of the shareholders.
- If default is made complying the requirement of section 165, every person responsible shall be punishable with a fine extended to Rs. 5,000/-.
- If the company fails to call a statutory meeting then it becomes a sound ground for the winding up of the company.
Can the court demand a statutory meeting?
Yes, where the company fails to conduct a statutory meeting within a stipulated time, then the court may call for meeting.