# Types of Business Transacted at a General Meeting [Section 102(2)]

Business at a general meeting is classified into two mutually exclusive buckets:

## (A) Ordinary Business

Only four items qualify as ordinary business, and they can only arise at an AGM:

1. Consideration of Financial Statements (and Consolidated FS, if any), the Board's Report and the Auditors' Report.

2. Declaration of dividend.

3. Appointment of directors in place of those retiring by rotation.

4. Appointment of, and fixing remuneration of, auditors.

## (B) Special Business

Everything else is special business:

At AGM: Any business other than the four ordinary items above.
At EGM: Every business transacted (EGM has no "ordinary" business by definition).

## Why the distinction matters

1. Explanatory Statement under Section 102(1) must be annexed to the notice only for special business. Ordinary business does not need one.

2. The classification helps members quickly identify routine annual housekeeping (ordinary) versus matters that require deliberation (special).

## Quick Memory Aid

"FDAA" = Financial statements, Dividend, Appointment of retiring directors, Appointment of auditors.

Worked example

### Example 1

Example: At the AGM of P Ltd., the agenda includes — (i) adoption of accounts, (ii) declaration of dividend, (iii) reappointment of Mr. A as director retiring by rotation, (iv) reappointment of XYZ & Co. as auditors, (v) increase in authorised capital, (vi) appointment of Mr. B as MD. Which are ordinary and which are special?

Solution: Items (i)–(iv) are ordinary business. Items (v) and (vi) are special business and require an explanatory statement.

⚠️ Common exam mistakes

Treating any director appointment as ordinary — only reappointment of directors retiring by rotation is ordinary.
Forgetting that fixing remuneration of auditors is part of ordinary business.
Thinking EGM has ordinary business — it does not.
Skipping the explanatory statement for special business at AGM.

Bare-Act text Section 102(2) · Companies Act, 2013 · click to expand

Section 102(2) — For the purposes of sub-section (1),— (a) in the case of an annual general meeting, all business to be transacted thereat shall be deemed special, other than— (i) the consideration of financial statements and the reports of the Board of Directors and auditors; (ii) the declaration of any dividend; (iii) the appointment of directors in place of those retiring; (iv) the appointment of, and the fixing of the remuneration of, the auditors; and (b) in the case of any other meeting, all business shall be deemed to be special.

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Types of Business at General Meeting (Section 102(2))

Worked example

⚠️ Common exam mistakes