Procedure of meetings and proceedings of a company


Each and every company has to take certain decisions, whether related to management, marketing, finance, or any other filed and those decisions impact the whole company and the people related to it. Whether being actively being a part of its board of directors or being an employee of the company or whether being a share-holder of the company and just watching everything from outside, those decisions whether a lot or less affects these people and impacts them too. So each and every company has to have certain meetings with its members including the board of directors and its employees, and even some meeting with the share-holders of the company, who would also get affected with all the decisions taken by the company as they are also a part and somewhat owner of it according to their share in the company, so they are also an integral part of it.

As we now know that who all gets involved in different meetings and what are the reasons for it, we shall know that who could actually call for such meetings and under what conditions. Any member of the board of director of the company, at any time whenever he or she feels necessary could call for the meeting of board and discuss the important issues which are to be dealt. The company secretary or in cases where there is no appointed company secretary, the person authorized by the board of directors, on behalf of them could take the decision on the requisition of a director of the company could hold a meeting of board in consultation with the chairman of the company.

The section 173, 174 and 175 of the companies act 2013 deals with all the required provisions and procedure that need to be dealt with the conduction and dealing of commencement of meeting of board and its power. The sub-section (1) of section 173 states that each and every company is required to hold its first meeting of board of directors within 30 days of its incorporation and it is required to hold at least 4 meetings of the board of directors every year and there must not be a gap of more than one hundred and twenty days within the commencement of 2 consecutive meetings. The Central government even may direct or provide some exceptions relating to any class or description of companies and for those companies the conditions dealt in the sub-section (1) of section 173 may not apply or the company shall apply on its own to such exceptions, modifications or conditions as maybe specified in the notification. The notice sent for the commencement of meeting shall inform the directors about all the options and necessary information required for them like the date and time of the meeting, the options available for the directors to participate in the meeting, that whether they could participate in the meeting through video conferencing or not and all other things like that.

According to sub-section (2) of section 173 of the companies act 2013, the participation of the directors in the meetings of board could be either be in person, through video conferencing, through an audio-visual format or any format which would be prescribed and which must be in a manner that could be recorded by recognizing the participation of the board of directors and recording and storing of these meetings along with the date and time of the commencement must be mentioned. The Central government may issue or specify the matters or the topics which must not be dealt in a video conferencing format or any other audio or visual format and must be dealt in person, so that no issues arise in the future regarding the same.

The sub-section (3) of section 173 states that for commencement of meeting of board, a notice for the meeting shall be delivered to each of the members of the board of directors at their registered address, either by hand delivery or by post, or by electronic means. An emergency meeting without 7 days prior notice could also be conducted on a short notice for some specified urgent issues that the company needs to deal like urgent business transactions, etc. But the presence of at least 1 independent director of the company must be there, for successfully commencement of such meetings. And in case there is no independent director available at that moment, then circulation of all the points and matters discussed in the meeting must be circulated to the board of directors and it must be dealt when at least one independent directors is found available.

The people who are appointed and it is their duty to circulate the notice amongst the board of directors for the commencement of the meeting of board, if by any chance fails to perform their duty and are not able to perform it successfully are liable to a penalty of twenty five thousand rupees, which must be paid by that individual or group which was appointed for the same.

According to sub-section (1) of section 174 of the companies act 2013, the quorum for a meeting of boards of directors of a company shall be one third of the total strength or its 2 directors, whichever is higher amongst the two. The participation of the directors of the company by video conferencing or by audio visual measures must also be counted.

The section 175 of the companies act deals with passing of resolution by the board of directors of the company, the sub-section (1) of this section states that no resolution shall be deemed to have passed the board of directors or by a committee by circulation, unless the resolution has been circulated in a draft format with all the necessary and required papers and documents to all the directors at their registered address with the company and must be hand delivered or be sent by post or by courier or even by electronic media or means which would be prescribed or would have been approved by the majority of its members of the board.


Author: Harsh Chaudhary,

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