An Annual General Meeting (AGM) is a compulsory yearly meeting between a company’s shareholders and its board of directors. It is the main platform where owners of the company review how the business performed during the year and how it will move ahead.
In simple words, AGM is like the company’s “yearly report card meeting.” Shareholders can ask questions, approve accounts, decide dividends, and appoint key people such as directors and auditors.
Under Section 96 of the Companies Act, 2013, every company—except a One Person Company (OPC)—must hold an AGM once every year.
Key Takeaways
- AGM is a yearly meeting where shareholders review the company’s performance and decisions.
- Almost every company in India must hold an AGM except One Person Companies.
- Shareholders approve accounts, dividends, and appointment of directors in AGM.
- AGM can be physical or through video conference with e-voting facility.
- Missing AGM deadlines can lead to heavy penalties for the company.
Why is an AGM important for beginners to understand?
AGM matters because it brings transparency and accountability. The people running the company must explain their decisions to the real owners—the shareholders.
For small investors, AGM is the only official chance to:
- Understand profit or loss
- Know whether dividend will be paid
- Check if management is performing well
- Raise concerns directly
Many beginners think AGM is only a formality, but in real Indian practice, it is the backbone of corporate discipline.
How does an AGM take place – in simple steps?
The AGM process normally follows these steps:
- Books are closed: Company finalizes accounts for the year ending 31 March.
- Board meeting: Directors approve financial statements and decide AGM date.
- Notice sent: At least 21 clear days’ notice is sent to members and auditors.
- Meeting held: AGM is conducted at the registered office or approved venue between 9 a.m. and 6 p.m.
- Discussion & voting: Members approve accounts, dividend, and appointments.
- ROC filings: After the meeting, forms like AOC-4 and MGT-7 are filed.
Example:
If XYZ Pvt. Ltd. closes accounts on 31 March 2025, its AGM must normally be held by 30 September 2025. Shareholders may approve a ₹10 lakh dividend and reappoint the auditor.
What are the due dates for holding an AGM?
- First AGM: within 9 months from the end of the first financial year.
- Subsequent AGMs: within 6 months from financial year end.
- Gap between two AGMs: cannot exceed 15 months.
- Top 100 listed companies: within 5 months of year end.
- ROC may give up to 3 months extension (not for first AGM).
Simple formula
- First AGM = Financial Year End date (31st March) + 9 months
- Later AGMs = Financial Year End date (31st March) + 6 months
- Max gap = Last AGM + 15 months
What business is normally done in an AGM?
Ordinary Business (every year):
- Approval of audited financial statements
- Declaration of dividend
- Appointment or rotation of directors
- Appointment of auditors
Special Business (when required):
- Appointment of Managing Director
- Related-party transactions
- Change in Articles/Memorandum
- Any matter needing special resolution
Example: If profit after tax is ₹40 lakh and company declares 10% dividend on 2,00,000 shares of ₹10, total dividend = ₹2 lakh.
Where and when can an AGM be held?
- Must be on a day other than national holidays (26 Jan, 15 Aug, 2 Oct).
- Time: 9:00 a.m. to 6:00 p.m.
- Venue: normally registered office or same city/town.
- Unlisted companies may hold AGM anywhere in India with members’ consent.
- Listed companies must stay within the same city limits.
Do One Person Companies need to hold an AGM?
No. OPCs are exempt from physical AGM.
Instead:
- The single member records decisions in the minutes book.
- That date becomes the “deemed AGM date.”
- OPC must still file:
- Financials within 180 days (AOC-4)
- Annual return within 60 days (MGT-7A)
Many beginners assume OPCs have zero compliance—this is a common confusion. Only the meeting is exempt, not the filings.
What happens if the AGM is not held on time?
Penalties under Section 99:
| Default | Company | Officer |
|---|---|---|
| Not holding AGM | Up to ₹1,00,000 | Up to ₹1,00,000 |
| Continuing default | ₹5,000 per day | ₹5,000 per day |
Shareholders can also approach NCLT to order the company to hold an AGM.
From practical experience, even a small delay becomes expensive very fast, so companies usually apply for extension instead of risking penalties.
Can an AGM be held through video conference?
Yes. As per MCA circulars, companies can conduct AGM through VC/OAVM with conditions:
- Two-way live interaction
- E-voting facility
- Attendance counted digitally
- Notice must contain login details
- Proxies not allowed in virtual AGM
This became very common after 2020 and many Indian companies now prefer this mode.
How to apply for AGM extension?
- File Form GNL-1 with ROC before the due date
- Valid reasons: audit delay, auditor resignation, natural calamity, consolidation issues
- Extension up to 3 months may be granted
Tip from practice: Apply at least 15 days early. Vague reasons like “busy schedule” are usually rejected.
What are post-AGM compliance filings?
After the meeting, companies must file:
| Filing | Form | Time limit |
|---|---|---|
| Financial statements | AOC-4 | 30 days |
| Auditor appointment | ADT-1 | 15 days |
| Annual return | MGT-7 / MGT-7A | 60 days |
| Special resolutions | MGT-14 | 30 days |
Many beginners think AGM is the last step, but actually filings after AGM are equally important.
Practical yearly action plan for companies
- Fix compliance calendar after 31 March
- Start audit by May-June
- Board meeting by July-August
- Send notice 21 clear days before AGM
- Hold AGM by September
- Complete AOC-4, ADT-1, MGT-7 on time
Common Mistakes to Avoid
- Counting 21 days incorrectly
- Holding AGM on national holiday
- Forgetting auditors in notice
- Assuming extension is automatic
- Delaying ROC filings after AGM
- Not keeping proof of notice dispatch
Conclusion
An AGM is not just a legal ritual—it is the heart of corporate transparency in India. It helps shareholders understand profits, question management, and approve key decisions. Holding the meeting on time and completing post-AGM filings keeps the company safe from penalties and builds trust with investors.
We hope this article helped you understand the Annual General Meeting (AGM) in India in a clear and practical way. You may also find our guides on ROC Annual Filings and Director Appointment Rules useful for deeper learning.
Frequently Asked Questions About Annual General Meeting (AGM)
If you are new to company law or investing, AGM can sound formal and confusing. These FAQs answer both basic and real-life questions that beginners in India usually ask when they first hear about Annual General Meetings.
Is AGM compulsory for every company in India?
Yes, almost every company must hold an AGM once a year under the Companies Act, 2013. The only major exception is a One Person Company (OPC). Even small private companies with no profit must still conduct an AGM.
Who can attend an AGM?
All shareholders, directors, and auditors have the right to attend. Shareholders can also send a proxy to attend on their behalf in physical AGMs. For virtual AGMs, proxies are generally not allowed.
What decisions are taken in an AGM?
Routine matters like approval of financial statements, declaration of dividend, and appointment of directors and auditors are discussed. Sometimes special matters such as change in company rules or approval of big transactions are also taken up.
How is AGM different from an EGM?
AGM happens once every year for regular business, while an EGM is called anytime for urgent matters. For example, issuing new shares in December requires an EGM because it cannot wait till the next AGM.
Do loss-making companies also need to hold AGM?
Yes. Even if the company earned zero income or made a loss, AGM is still mandatory. AGM is about accountability, not only about profits.
What filings are required after AGM?
Companies must file financial statements in Form AOC-4 within 30 days and annual return in Form MGT-7 within 60 days. If special resolutions are passed, Form MGT-14 is also filed.
Can AGM be held on 15th August or 26th January?
No. AGM cannot be held on national holidays—26 January, 15 August, or 2 October. It must be conducted between 9 a.m. and 6 p.m. on a working day.
What is the gap allowed between two AGMs?
The gap between two AGMs cannot exceed 15 months. Normally, AGM must be held within 6 months from the end of the financial year, usually by 30 September.
Are AGM rules useful for small investors?
Definitely. AGM lets small investors understand where their money is used and whether the company is growing responsibly. Many beginners in the Indian stock market track AGM updates before investing more.
