Pursuant to the provisions of section 166, every company, whether public or private, incorporated under the provisions of the Companies Act, 1956 shall hold during every year a general meeting of members, which shall be called ‘Annual General Meeting’.  It is mandatory on every company to hold an annual general meeting in every calendar year.

A new company which is registered under the Act, shall hold its first annual general meeting latest within a period of eighteen months from the date of its incorporation, namely, the date on which the Registrar has issued the certificate of incorporation to the company.  If the first annual general meeting is so held, it is not necessary for the company to hold another annual general meeting in the year of its incorporation or in the following year. It may also be noted in this connection that the accounts placed before the first annual general meeting shall be for the period beginning from the date of incorporation and ending on a day of financial year, which will not precede the first annual general meeting by more than nine months from the close of the first financial year of the company-section 210(3). This may be illustrated by the following example:

As mentioned above, every company shall hold every year an annual general meeting and ordinarily there shall not be a gap of more than fifteen months between two such meetings.  Further that in terms of the provisions of section 210 an annual general meeting shall be held within a period of six months from the end of the financial year whose accounts are proposed to be considered at the said annual general meeting. Accordingly, it is the rule that a company, whose financial year ends on 31st March, shall hold its annual general meeting by 30th September every year.

Every company (whether public or private having a share capital, as well as every company not having a share capital, is required to file annual return with the Registrar within sixty days from the day on which each of the annual general meetings is held.

Consequences of not filing the annual return are very serious. If a company fails to comply with any of the provisions contained in section 159, 160, or 161, the company, and every officer of the company who is default, shall be punishable with fine which may extend to five hundred rupees for every day during which the default continues. If the annual return is not filed continuously for three financial years, then any director of such public limited company shall not be eligible for appointment as a director of any other public company for a period of five years from the date on which such public company in which he is a director failed, inter alia, to file annual returns.

A financial year is a period of twelve months and the accounts of a company for a financial year shall be placed at every annual general meeting. But in certain circumstances a financial year may be for less than a year or it may be for more than a year as in the case of the first annual general meeting but is shall not exceed fifteen months.

The Registrar has power to extend a financial year up to eighteen months in terms  of the proviso under section 210 (4) of the Act. The company shall make an application in the prescribed e-Form 61 with the Registrar before the due date for closing of the financial year. The application may be made by a letter giving full justification for seeking extension of time certified by the chartered accountant or company secretary or cost accountant in practice.

Where a company proposed to extend its financial year and in that process requires extension in time for holding its annual general meeting it shall make an application in the e-Form 61 with the Registrar of Companies for extending financial year under section 210 (4) and for granting extension in time for holding annual general meeting under the proviso to section 166 (1).

For the purpose of the Income-tax Act, 1961, previous year means the financial year immediately preceding the assessment year. Accordingly, for the purpose of the said Act, from the assessment year 1989-90, the assesses including companies were required to declare their income every year as on 31st March. All that is necessary from the said assessment year is to make up the account as on 31st March, for the purpose of submitting the Income-Tax return.