Understanding the Statutory Meeting Procedure

A statutory meeting is a crucial event in the early life of certain companies. It is the first general meeting of the shareholders of a public company limited by shares or a company limited by guarantee and having a share capital. This meeting is held to discuss the statutory report, which provides shareholders with important information about the company's formation, share allotment, cash receipts, and payments.

Calling a statutory meeting involves following a specific sequence of legal requirements to ensure all stakeholders are properly informed and the meeting is conducted legally. The steps involved in the procedure for calling a statutory meeting, based on the sequence C, A, D, E, B, are explained below:

1. C. Twenty-one days notice: The first formal step in calling the statutory meeting is issuing a notice to all members. This notice must be given at least twenty-one days before the date of the meeting. The notice informs members about the time, place, and agenda of the statutory meeting.
2. A. Contents of the statutory report: The statutory report itself must be prepared. This report contains detailed information required by law, such as the total number of shares allotted, the cash received in respect of such shares, an abstract of the receipts and payments of the company, and details of directors, auditors, and contracts.
3. D. Certification of the statutory report by not less than two directors, one of whom must be the managing director: Once the statutory report is prepared, it needs to be certified by the directors. As specified, at least two directors, including the managing director (if any), must sign the report to certify its accuracy and compliance with legal requirements. Auditors also certify parts related to shares and cash.
4. E. A certified copy of the statutory report must be delivered to the Registrar: After the statutory report has been prepared and certified, a certified copy must be delivered to the Registrar of Companies for filing. This filing is a mandatory requirement before the statutory meeting is held and typically happens concurrently with sending the report to members.
5. B. A list of members must be produced at the commencement: At the statutory meeting itself, specifically at the commencement of the meeting, a list containing the names, addresses, and occupations of the members and the number of shares held by them must be produced. This list is made available for inspection by any member during the meeting.

Arranging these actions in the sequence C, A, D, E, B details the procedural steps related to the statutory meeting as presented in the options.

Revision Table: Statutory Meeting Procedure Steps

Additional Information on Statutory Meetings and Reports

• A statutory meeting is mandatory for public companies limited by shares and certain companies limited by guarantee having a share capital. It must be held within a specific timeframe (not less than one month and not more than six months) from the date the company becomes entitled to commence business.
• The statutory report must be sent to members at least twenty-one days before the date of the meeting. This means the report preparation, certification, and filing with the Registrar (Steps A, D, E) must be completed in time to be sent out along with or before the notice (Step C). While the provided sequence lists C first, the legal requirement is that the report accompanies or precedes the notice sent to members.
• During the statutory meeting, shareholders can discuss the statutory report and any matters arising from it, but no resolution can be passed unless notice of such resolution has been given in accordance with the law.
• Private companies are generally not required to hold a statutory meeting or file a statutory report.