Section 102 of the Companies Act, 2013
Section 102 of the Companies Act, 2013 deals with the Statement to be Annexed to Notice of a general meeting.
🔹 Section 102 – Statement to Be Annexed to Notice
This section ensures transparency by requiring certain disclosures in the notice of a general meeting when special business is to be transacted.
✅ Key Provisions:
1. Applicability:
Applies to all companies, except One Person Company (OPC).
2. When is a statement required?
A statement must be annexed to the notice for every item of special business.
3. What is Special Business?
In the case of:
Annual General Meeting (AGM):
Only ordinary business (like approval of accounts, declaration of dividend, appointment of directors/auditors) is not special.
All other items = special business
Extraordinary General Meeting (EGM):
All items are treated as special business
4. What must the statement contain?
Material facts relating to each item of special business.
Nature of concern or interest (financial or otherwise) of:
Directors
Manager
Key Managerial Personnel (KMP)
Relatives of the above
Any other information that enables members to understand the meaning, scope, and implications of the business.
Where the business relates to approval of any documents, the time and place where they can be inspected must be specified.
5. Penalty for Non-Compliance:
If a company fails to comply:
The concerned person (who approved the notice) is liable to a penalty of ₹25,000.
📌 Example:
If a company plans to approve a new employee stock option scheme (ESOP) in an EGM, the notice must include a detailed statement explaining:
The purpose of the ESOP,
Who will benefit,
Any interests of directors or KMPs,
Where related documents can be inspected.
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