Section 378ZA Companies Act 2013 - Annual General Meetings

Section 378ZA of the Companies Act, 2013 contains the special rules governing annual general meetings of a Producer Company. It forms part of Chapter XXIA, which deals specifically with Producer Companies.

Key compliance points: A Producer Company must hold an AGM every year; ordinarily no more than 15 months may pass between two AGMs. The first AGM must be held within 90 days of incorporation. General meetings require at least 14 days' prior written notice, and the AGM proceedings and specified financial documents must be filed with the Registrar within 60 days.

Meaning and scope of Section 378ZA

An annual general meeting, commonly called an AGM, is the yearly general meeting of the members of a Producer Company. Section 378ZA prescribes the timing of the AGM, documents to accompany the notice, requisition of an extraordinary general meeting, place and time of the AGM, notice requirements, quorum, filing obligations and representation of Producer Institutions.

These are special provisions for Producer Companies. They should be read with the other applicable provisions of Chapter XXIA and, where Section 378ZA expressly refers to it, the relevant provisions of Chapter VII of the Companies Act, 2013.

Section 378ZA - Annual general meetings

(1) Every Producer Company shall in each year hold, in addition to any other meetings, a general meeting as its annual general meeting and shall specify the meeting as such in the notices calling it. Not more than fifteen months shall elapse between the date of one annual general meeting and that of the next.

Proviso: The Registrar may, for any special reason, permit extension of the time for holding an annual general meeting, other than the first annual general meeting, by a period not exceeding three months.

(2) A Producer Company shall hold its first annual general meeting within ninety days from the date of its incorporation.

(3) The members shall adopt the articles of the Producer Company and appoint directors of its Board in the annual general meeting.

(4) The notice calling the annual general meeting shall be accompanied by:

  • the agenda of the annual general meeting;
  • the minutes of the previous annual general meeting or extraordinary general meeting;
  • the names of candidates for election, if any, to the office of director, including a statement of qualifications for each candidate;
  • the audited balance sheet and profit and loss accounts of the Producer Company and its subsidiary, if any, together with the Board's report covering the state of affairs, proposed reserve, limited return on share capital, patronage bonus, material changes and commitments affecting financial position, relevant matters concerning energy conservation, environmental protection and foreign exchange, and other matters required or specified by the Board;
  • the text of the draft resolution for appointment of auditors; and
  • the text of any draft resolution proposing amendment of the memorandum or articles, together with the Board's recommendations.

(5) On a written requisition duly signed by one-third of the members entitled to vote in any general meeting and setting out the matters for consideration, the Board shall proceed to call an extraordinary general meeting in accordance with the relevant provisions of Chapter VII.

(6) Every annual general meeting shall be called during business hours, on a day that is not a public holiday, and shall be held at the registered office of the Producer Company or at another place within the city, town or village in which the registered office is situated.

(7) A general meeting of the Producer Company shall be called by giving not less than fourteen days' prior notice in writing.

(8) The notice shall indicate the date, time and place of the meeting and shall be sent to every member and auditor of the Producer Company.

(9) Unless the articles provide for a larger number, one-fourth of the total number of members of the Producer Company shall constitute the quorum for its annual general meeting.

(10) The proceedings of every annual general meeting, together with the Board's report, audited balance sheet and profit and loss account, shall be filed with the Registrar within sixty days of the AGM, with an annual return and the filing fees applicable under the Act.

(11) Where a Producer Company is formed by Producer Institutions, those institutions shall be represented in the general body through their Chairman or Chief Executive, who shall be competent to act on their behalf. A Producer Institution shall not be represented if it is in a default or failure referred to in clauses (d) to (f) of Section 378Q(1).

Practical compliance summary

The Board should schedule the AGM so that the statutory interval is observed, prepare the documents required by sub-section (4), issue the written notice at least fourteen days in advance, verify the required quorum, properly record the proceedings and complete the Registrar filing within sixty days. The Ministry of Corporate Affairs has specifically clarified on its portal that financial statements of Producer Companies are required to be filed within sixty days of the AGM under Section 378ZA(10).

Related provisions

For a complete understanding of Producer Company governance, Section 378ZA may be read with Section 378Q - Vacation of office by directors, the provisions governing general meetings in Chapter VII, and the succeeding provisions concerning share capital, accounts and audit.

Official legal resources

For the latest statutory text and regulatory updates, refer to the official Ministry of Corporate Affairs - Companies Act, 2013 and India Code.

Section 378ZA was inserted as part of the Producer Company provisions by the Companies (Amendment) Act, 2020, with effect from 11 February 2021. Always verify subsequent amendments, notifications and filing requirements on the official portals before compliance action.