Analysis of Revised Secretarial Standard-I (Effective from 01.10.2017) by CS Rahul Harsh, Company Secretary at Peerless Group



The ICSI has issued the Revised Secretarial Standards which has been approved by the Central Government under Section 118(10) of the Companies Act, 2013 and are effective from October 1st, 2017.

The Revised SS-1 & SS-2 shall replace the existing Secretarial Standards which are applicable till 30.09.2017.

This article is a comparative analysis of both the Existing as well as the Revised Secretarial Standard - 1 on Board Meeting.


Regulation No.

Existing Secretarial Standard 1

Revised Secretarial Standard 1

Comments

Scope

This Standard is applicable to the Meetings of Board of Directors of all companies incorporated under the Act except One Person Company (OPC)

This Standard is applicable to the Meetings of Board of Directors of all companies incorporated under the Act except One Person Company (OPC) & SECTION 8 Companies Or companies incorporated under a corresponding provision in earlier Companies Acts.

It is specifically mentioned that the SS – 1 shall not be applicable to OPC & Section 8 Companies.

1.2.3 (Participation in a Board or a Committee of Board- Meeting)

Directors shall not participate through Electronic Mode in the discussion on certain restricted items, unless expressly permitted by the Chairman.

Directors shall not participate through Electronic Mode in the discussion on certain restricted items.

Chairman shall not have any authority to allow a Director to Participate in a Meeting by electronic mode to discuss on restricted items in a Board Meeting.

1.2.3 (Participation in a Board or a Committee of Board- Meeting)

Participation in the discussion through Electronic Mode shall not be allowed in Meetings of the Audit Committee for consideration of annual financial statement including consolidated financial statement, if any, to be approved by the Board , unless expressly permitted by the Chairman.

Participation in the discussion through Electronic Mode shall not be allowed in Meetings of the Audit Committee for consideration of annual financial statement including consolidated financial statement, if any, to be approved by the Board.

Chairman shall not have any authority to allow a Director to Participate in a Meeting by electronic mode to discuss on consideration of annual financial statement including consolidated financial statement in an Audit Committee Meeting.

1.3 (Notice)

The Notice of Board / Committee of Board Meeting’s shall be sent to the postal address or e-mail address, registered by the Director with the company or in the absence of such details or any change thereto, any of such addresses appearing in the Director Identification Number (DIN) registration of the Director.

 

Where a Director specifies a particular means of delivery of Notice, the Notice shall be given to him by such means.

The Notice shall be sent to the postal address or e-mail address, registered by the Director with the company or in the absence of such details or any change thereto, any of such addresses appearing in the Director Identification Number (DIN) registration of the Director. Where a Director specifies a particular means of delivery of Notice, the Notice shall be given to him by such means.

 

However, in case of a Meeting conducted at a shorter Notice, the company may choose an expedient mode of sending Notice.

The company may choose to send Notice of Meeting by a Faster Mode in case a meeting is being held at a Shorter Notice.

1.3 (Notice)

Proof of sending Notice and its delivery shall be maintained by the company.

Proof of sending Notice and its delivery shall be maintained by the company for such period as decided by the Board, which shall not be less than three years from the date of the Meeting.

Time period for maintain the Proof of sending notices has now been provided in SS. It states that the Board shall have the authority to decide the proof of sending the notices. In any case it shall be Minimum 3 yrs from the date of Meeting.

1.3.4

In case the facility of participation through Electronic Mode is being made available, the Notice shall inform the Directors about the availability of such facility, and provide them necessary information to avail such facility.

The Notice shall inform the Directors about the option available to them to participate through Electronic Mode and provide them all the necessary information.

The Notice of Meetings shall Compulsorily provide all the Necessary Information’s & Procedures regarding the participation of Directors in a Meeting through Electronic Mode.

1.3.4 Participation

No Such Existing Provision

The Director may intimate his intention of participation through Electronic Mode at the beginning of the Calendar Year also, which shall be valid for such Calendar Year.

The Director shall now have the option to declare his participation in a Board / Committee of Board Meeting by Electronic Means for a complete Calendar Year.

1.3.6

Notice

In case the company sends the Notice by speed post or by registered post or by courier, an additional two days shall be added for the service of Notice.

In case the company sends the Notice by speed post or by registered post, an additional two days shall be added for the service of Notice.

Sending notices by COURIER has been restricted.

1.3.7

Agenda & Notes to Agenda

Agenda and Notes on Agenda shall be sent to all Directors by hand or by speed post or by registered post or by courier or by e-mail or by any other electronic means.

Agenda and Notes on Agenda shall be sent to all Directors by hand or by speed post or by registered post or by e-mail or by any other electronic means

Agenda & Notes on Agenda Cannot be sent to Directors by COURIER.

1.3.7

Agenda & Notes to Agenda

In case the company sends the Agenda and Notes on Agenda by speed post or by registered post or by courier, an additional two days shall be added for the service of Agenda and Notes on Agenda.

In case the company sends the Agenda and Notes on Agenda by speed post or by registered post, an additional two days shall be added for the service of Agenda and Notes on Agenda.

Similarly Courier has also been removed from the list of Available modes.

1.3.7

Agenda & Notes to Agenda

Where a Director specifies a particular means of delivery of Agenda and Notes on Agenda, these papers shall be sent to him by such means.

Where a Director specifies a particular means of delivery of Agenda and Notes on Agenda, these papers shall be sent to him by such means. However, in case of a Meeting conducted at a shorter Notice, the company may choose an expedient mode of sending Agenda and Notes on Agenda.

The company may choose to send Notes of Agenda by a Faster Mode in case a Meeting is being held at a Shorter Notice.

1.3.7

Agenda & Notes to Agenda

Proof of sending Agenda and Notes on Agenda and their delivery shall be maintained by the company.

Proof of sending Agenda and Notes on Agenda and their delivery shall be maintained by the company for such period as decided by the Board, which shall not be less than three years from the date of the Meeting.

Time period for maintain the Proof of sending Agenda & Notes of Agenda has now been provided in SS. It states that the Board shall have the authority to decide the proof of sending the notices. In any case it shall be Minimum 3 yrs from the date of Meeting.

1.3.10

Agenda & Notes to Agenda

Any item not included in the Agenda may be taken up for consideration with the permission of the Chairman and with the consent of a majority of the Directors present in the Meeting, which shall include at least one Independent Director, if any.

Any item not included in the Agenda may be taken up for consideration with the permission of the Chairman and with the consent of a majority of the Directors present in the Meeting.

Consent of ID shall not be required to take Any item not included in Agenda.

3.2 Quorum

A Director shall not be reckoned for Quorum in respect of an item in which he is interested and he shall not be present, whether physically or through Electronic Mode, during discussions and voting on such item.

A Director shall neither be reckoned for Quorum nor shall be entitled to participate in respect of an item of business in which he is interested. However, in case of a private company, a Director shall be entitled to participate in respect of such item after disclosure of his interest

In case of a Pvt. Co. an interested Director may continue to participate in a Board Meeting after disclosure of his interest in particular item(s).

3.3 Quorum

No Such Explanations.

Any Director participating through Electronic Mode in respect of restricted items with the express permission of Chairman shall however, neither be entitled to vote nor be counted for the purpose of Quorum in respect of such restricted items.

 

The restricted items of business include approval of the annual financial statement, Board’s Report, prospectus and matters relating to amalgamation, merger, demerger, acquisition and takeover and in meetings of Audit Committee for the consideration of annual financial statement including consolidated financial statement, if any, to be approved by the Board.

The Director participating through Electronic Mode in respect of restricted items with the express permission of Chairman shall however, neither be entitled to vote nor be counted for the purpose of Quorum in respect of such restricted items.

3.5 Meetings of Committees

The presence of all the members of any Committee constituted by the Board is necessary to form the Quorum for Meetings of such Committee unless otherwise stipulated in the Act or any other law or the Articles or by the Board.

Unless otherwise stipulated in the Act or the Articles or under any other law, the Quorum for Meetings of any Committee constituted by the Board shall be as specified by the Board. If no such Quorum is specified, the presence of all the members of any such Committee is necessary to form the Quorum.

The Regulation has been redrafted to provide a better clarification.

4.1.1 Attendance Register

Every company shall maintain separate attendance registers for the Meetings of the Board and Meetings of the Committee.

Every Company shall maintain attendance register for the Meetings of the Board and Meetings of the Committee.

The Regulation has been redrafted to provide a better clarification.

4.1.2 & 4.1.3

Attendance Register

The attendance register shall contain the following particulars: serial number and date of the Meeting; in case of a Committee Meeting name of the Committee; place of the Meeting; time of the Meeting; names of the Directors and signature of each Director present; name and signature of the Company Secretary who is in attendance and also of persons attending the Meeting by invitation.

The attendance register shall contain the following particulars: serial number and date of the Meeting; in case of a Committee Meeting name of the Committee; place of the Meeting; time of the Meeting; names and signatures of the Directors, the Company Secretary and also of persons attending the Meeting by invitation and their mode of presence, if participating through Electronic Mode.

If a Director participates in a Meeting by Electronic Means their attendance is to be recorded in the attendance register and authenticated by the Company Secretary or where there is no Company Secretary, by the Chairman or by any other Director present at the Meeting, if so authorised by the Chairman and the fact of such participation is also recorded in the Minutes.

4.1.5

Attendance Register

The attendance register is open for inspection by the Directors.

The attendance register is open for inspection by the Directors. Even after a person ceases to be a Director, he shall be entitled to inspect the attendance register of the Meetings held during the period of his Directorship

A person who has ceased to be a Director of a Company shall have right to inspect the attendance register of the Meetings held during the period of his Directorship.

4.1.6 of Existing S.S.

 

- Attendance Register

Entries in the attendance register shall be authenticated by the Company Secretary or where there is no Company Secretary, by the Chairman by appending his signature to each page.

No such regulation in Revised SS.

This requirement has been done away with.

4.2

Leave of absence

Leave of absence shall be granted to a Director only when a request for such leave has been received by the Company Secretary or by the Chairman.

Leave of absence shall be granted to a Director only when a request for such leave has been communicated to the Company Secretary or to the Chairman or to any other person authorised by the Board to issue Notice of the Meeting.

A Leave of Absence application may NOW be sent to any other person authorised by the Board to issue Notice of the Meeting in addition to the existing list.

5.1.2

Chairman

 

If the Chairman is interested in any item of business, he shall, with the consent of the members present, entrust the conduct of the proceedings in respect of such item to any Dis-interested Director and resume the Chair after that item of business has been transacted. The Chairman shall also not be present at the Meeting during discussions on such items.

If the Chairman is interested in an item of business, he shall entrust the conduct of the proceedings in respect of such item to any Non-Interested Director with the consent of the majority of Directors present and resume the chair after that item of business has been transacted. However, in case of a private company, the Chairman may continue to chair and participate in the Meeting after disclosure of his interest.

 

If the item of business is a related party transaction, the Chairman shall not be present at the Meeting, whether physically or through Electronic Mode, during discussions and voting on such item.

The chairman of the Board of a private company may continue to chair and participate in the Meeting after disclosure of his interest.

 

But, If the item of business is a related party transaction, the Chairman shall not be present at the Meeting, whether physically or through Electronic Mode, during discussions and voting on such item.

5.1.2

Chairman

 

No such Requirement.

The Chairman shall ensure that the required Quorum is present throughout the Meeting and at the end of discussion on each agenda item the Chairman shall announce the summary of the decision taken thereon.

The chairman has an additional responsibility to ensure that the Quorum was present through the meeting and AT THE END OF DISCUSSION ON EACH AGENDA ITEM the Chairman shall announce the summary of the decision taken thereon.

6.1.1

Authority

The Chairman of the Board or in his absence, the Managing Director or in his absence, the Whole time Director and where there is none, any Director other than an Interested Director, shall decide, before the draft Resolution is circulated to all the Directors, whether the approval of the Board for a particular business shall be obtained by means of a Resolution by circulation.

The Chairman of the Board or in his absence, the Managing Director or in their absence, any Director other than an Interested Director, shall decide, before the draft Resolution is circulated to all the Directors, whether the approval of the Board for a particular business shall be obtained by means of a Resolution by circulation.

After MD any director of the Company except interested director has the authority to take decision on whether the approval of the Board for a particular business shall be obtained by means of a Resolution by circulation.

6.2.2

Procedure

Proof of sending and delivery of the draft of the Resolution and the necessary papers shall be maintained by the company.

Proof of sending and delivery of the draft of the Resolution and the necessary papers shall be maintained by the company for such period as decided by the Board, which shall not be less than three years from the date of the Meeting.

Proof of sending the Draft resolution to be passed by circulation also needs to be maintained for 3 years.

6.2.3

Not more than seven days from the date of circulation of the draft of the Resolution shall be given to the Directors to respond and the last date shall be computed accordingly.

An additional two days shall be added for the service of the draft Resolution, in case the same has been sent by the company by speed post or by registered post or by courier.

Additional 2 Days to be given to the Directors for responding on the Circular resolution if sent by Speed post, Reg. post or courier.

7.2.2.1

Contents of Minutes

As provided in the SS

Point (o) has been inserted and its provides that Minutes shall inter-alia contain::

 

Consideration of any item other than those included in the Agenda with the consent of majority of the Directors present at the Meeting and ratification of the decision taken in respect of such item by a majority of Directors of the company.

Details of Any item other than those mentioned in the agenda and the required consents / ratification needs to be provided.

7.3.4

Recording of Minutes

Where any earlier Resolution (s) or decision is superseded or modified, Minutes shall contain a reference to such earlier Resolution (s) or decision.

Where any earlier Resolution(s) or decision is superseded or modified, Minutes shall contain a specific reference to such earlier Resolution(s) or decision or state that the Resolution is in supersession of all earlier Resolutions passed in that regard.

Refersnce to the Earlier Resolution to be mentioned in Minutes if a resolution is passed in supersession of it.

7.4

Finalisation of Minutes

Proof of sending draft Minutes and its delivery shall be maintained by the company.

Proof of sending draft Minutes and its delivery shall be maintained by the company for such period as decided by the Board, which shall not be less than three years from the date of the Meeting.

Proof of sending draft Minutes and its delivery shall be maintained by the company for 3 yrs or Period decided by BOD.

7.5.3

Entry in the Minutes Book

Minutes, once entered in the Minutes Book, shall not be altered. Any alteration in the Minutes as entered shall be made only by way of express approval of the Board at its subsequent Meeting in which such Minutes are sought to be altered.

Minutes, once entered in the Minutes Book, shall not be altered. Any alteration in the Minutes as entered shall be made only by way of express approval of the Board at its subsequent Meeting at which the Minutes are noted by the Board and the fact of such alteration shall be recorded in the Minutes of such subsequent Meeting.

Any alteration in Minutes shall be mentioned in Minutes of Subsequent meeting at which they are noted and the details of alteration made also needs to be recorded.

7.6.4

Signing and Dating of Minutes

No existing requirement.

Proof of sending signed Minutes and its delivery shall be maintained by the company for such period as decided by the Board, which shall not be less than three years from the date of the Meeting.

Company needs to maintain proof of sending Certified Copy of Signed Minutes to the Directors for 3 years.

9 - Disclosure

The Annual Report and Annual Return of a company shall disclose the number and dates of Meetings of the Board and Committees held during the financial year indicating the number of Meetings attended by each Director.

The Report of the Board of Directors shall include a statement on compliance of applicable Secretarial Standards.

The requirement of disclosing the number and dates of Meetings of the Board and Committees held during the financial year indicating the number of Meetings attended by each Director in the Annual Report of the Company has been removed.

Author

CS Rahul Harsh
E-mail: csrahulharsh@gmail.com
Company Secretary at Peerless Group

Click here to read the disclaimer


Write a Comment