Insights & Research
Time for conducting Board Meeting
A Meeting can be held at any time. Where, it should be practically interpreted to mean a convenient time. It is desirable to have Meetings during working hours as detailed discussions are expected to take place in Board Meetings, Although the Meeting may continue beyond working hours.
Place For Conducting Board Meeting
The Board meeting can be conducted at the registered office, head office of the company or any other place. Moreover, the Meeting can also be conducted outside India, where the participation of the directors by video conferencing or by any other audio-visual means also be valid. Where, the company has to make necessary arrangements to avoid the failure of video or audio connection during the meeting. And also, there are some certain items of business cannot be transacted through electronic mode as per the act and rules thereon.
Quorum of the Meeting
As per companies Act 2013, the quorum of board meeting is either two directors or one third of its total Strength of the Board, whichever is higher. Interested director shall not be counted for the purpose of quorum. When the director participates through video conferencing, he is counted for quorum but, if he has interest in any matter, then shall not be counted for the purpose of quorum. If the interested directors equal or exceeds the two-thirds of total number of directors, the disinterested directors present in the board shall not less than two, deemed the quorum. If the one third of the total number obtains a fraction, it must be rounded off to the nearest higher number.
E.g., If a company have seven directors, then the quorum must be three of them.
And in case of interested directors, if they are equals or more to two third of total number of directors, in such meeting the non-interested directors present must not be less than two directors.
For section 8 companies, the quorum for a board meeting is either eight members or twenty-five per cent, of its total strength whichever is less.
A director cannot appoint a proxy, who on behalf of the director can attend the meeting of the board of directors. The Companies Act, 2013 does not contain any provisions on the appointment of a proxy by a director to attend a board meeting neither the Table A in Schedule I has any such provisions.
Where a meeting of the Board could not be held for want of quorum, then, unless the articles of the company otherwise provide, the meeting shall automatically stand adjourned to the same day at the same time and place in the next week or if that day is a national holiday, till the next succeeding day, which is not a national holiday, at the same time and place.
Recording of Minutes
The Company has to record the proceedings and prepare minutes of the meetings, such draft shall be circulated to all the Directors by hand, by speed post, by registered post, by courier, by e-mail or by any other recognized electronic means within fifteen days and shall be signed in such manner as may be prescribed and kept within thirty days of the conclusion of every such meeting concerned. And such signed minutes shall be approved by the Board of Directors in their succeeding meeting. The minutes of Board meeting are typically recorded by a secretary who records all decisions made by the group and any actions that were taken.
By taking minutes, there is an official record of what happened in the meeting. Generally, this recording process prevents any misunderstanding as to what transpired.
It is an undisputed fact that a meeting of the Board of Directors is important. Where the Companies Act, 2013 mandates every company for conducting board meeting in between the time duration prescribed so. The board meeting stands responsible for establishing accountability for company management and to assure reasonable internal controls.
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