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Call this pandemic effect and ongoing fears and uncertainty over the impact of new Covid variant Omicron. The Ministry of Corporate Affairs has now allowed companies whose annual general meetings (AGMs) are due to be held in 2021 to hold them via video conference till end June next year.
It has also clarified that companies can hold their extraordinary general meetings (EGMs) via video conference and transact items through postal ballot till end June next year. Both these clarifications have come through separate circulars issued by the MCA. These will prove handy for corporates that are faced with several challenges due to the ongoing pandemic, said corporate observers.
Ruby Singh Ahuja, senior partner, Karanjawala and co, a law firm, said the MCA circular, which allows the EGMs to be held through video conferencing, is keeping in view the need of the hour, since due to pandemic there is reluctance to meet physically. “Work from home is a preferred mode worldwide and having an online meeting is certainly cost and time efficient,” she said.
Aseem Chawla, Managing Partner, ASC Legal, said the two clarifications issued do suggest in unanimity for the time —being, June 30, 2022 as the cut-off date to conduct the business of AGM and EGM via video conference or other audio visual means. So till June 30, 2022 the companies can make good of virtual means of conducting such meetings.
Also read: Making virtual AGMs click
“Also it is further stated that no extension of holding of AGM to beyond June 30, 2022 would be granted. The same is in recognition of the fact that it will take some time before physical meetings could be facilitated and the said clarifications do enable the same,” he said.
Mathew Chacko, Partner, Spice Route Legal, said:“This move by the government is progressive and much needed. Expecting people to meet at times like these for matters which can be resolved through Video conference is unreasonable. The relevant question to ask is — now that we know it can be done efficiently, why aren’t we extending this facility to a post pandemic world?”
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