Secretarial Standard-1 [Meetings of the Board of Directors] By Divya Saluja

The Highlight of the Article:
The important amendments and comparisons have been highlighted and made for reference and a better understanding as per revised secretarial standards.

Secretarial Standard is applicable to the Meetings of Board of Directors of all Companies incorporated under the Act except:
  • One Person Company (OPC) under section 2 (62) in which there is only one Director on its Board, and
  • A company licensed under Section 8 of the Companies Act.

Notice of Meeting must be given at least 7 days before day date of meeting (In case of speed post or by registered post, additional two days) to Every Director.

  • By hand or
  • By speed post or
  • By registered post or
  • By facsimile or
  • By e-mail or
  • By any other electronic means.
The notice should not be given by courier cool

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

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

Company Secretary or where there is no Company Secretary, any Director or any other person authorised by the Board.

Director can participate through ELECTRONIC MEANS but he should give prior Intimation to Chairman OR Company Secretary. He may also give intimation for participation through electronic means at the beginning of the Calendar year which valid for the whole year.                                                  

The Quorum Of Board Meeting shall be 1/3 of the total strength of the Board, or two Directors, whichever is higher.

(Any fraction above one-third rounded off to the next One).

  • A Meeting may be convened at any time and place on any day even on National holiday.
  • If Board Meeting not held as Quorum not present, then the Meeting will be Adjourned. (Next week same day, same time, same place)
  • Adjourned Board Meeting can be held on “National Holiday”.
  • If there is no Quorum at the adjourned Meeting also, the Meeting shall stand Adjourned. (Next week same day, same time, same place)  
  • In case the director of a company is less than the quorum that continuing director can act for the purpose of increasing the number of Directors or for summoning the general meeting.
  • Director shall not be reckoned for Quorum in respect of an item in which he is interested.

    However, in the case of a private company, a Director shall be entitled to participate in respect of such item after disclosure of his interest.

The Company shall hold at least four Meetings of its Board in each Calendar Year with a maximum interval of one hundred and twenty days between any two consecutive Meetings.

Every company shall maintain attendance register at the Registered Office of the company or such other place as may be approved by the board for the Meetings of the Board and Meetings of the Committee.
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.
Attendance register shall be preserved for a period of 8 Financial Year from the date Of last entry, and kept in custody of Company Secretary, in case no company secretary custody of any other person authorised by the Board.

Resolution is passed when it is approved by a majority of the Directors entitled to vote on the Resolution unless not less than one-third of the total number of Directors for the time being require the Resolution under circulation to be decided at a Meeting.

An Interested Director shall not be entitled to vote.

A Director shall be treated as interested in a contract or arrangement entered or proposed to be entered into by the company:

(a) with any body corporate, if such Director, along with other Directors holds more than two per cent of the paid-up share capital of that body corporate, or he is a promoter, or 
manager or chief executive officer of that body corporate; or

(b) with a firm or other entity, if such Director is a partner, owner or Member, as the case may be, of that firm or other entity.
The Resolution, if passed, shall be deemed to have been passed on the earlier of:

(a) the last date on which assented or dissented by the Directors, or

(b) the date on which assent has been received from the required majority provided that

On that date the number of Directors, who have not yet responded on the resolution under circulation, along with the Directors who have expressed their desire that the resolution under circulation be decided at a Meeting of the Board, shall not be one third or more of the total number of Directors; and shall be effective from that date, if no other effective date is specified in such Resolution.
Every company shall keep Minutes of all Board and Committee Meetings in a Minutes Book in physical or electronic form, kept at the Registered Office of the company or at such other place as may be approved by the Board, which will act as a evidence of the proceedings of the meeting.
Minutes Books, if maintained in loose-leaf form, shall be bound periodically depending on the size and volume.

General Contents: Minutes shall state at the beginning

  • Serial number
  • Type of the Meeting
  • Name of the company
  • Day, Date, Venue and Time of commencement of the meeting    
Specific Contents:

  • Name of Directors present and their mode of attendance, if through Electronic Mode.
  • Names of Directors who sought and were granted leave of absence.
  • Name of Company Secretary who is in attendance and Invitees, if any, for specific items and mode of their attendance if through Electronic Mode.
  • Record of the presence of Quorum.
  • Noting of the Minutes of the preceding Meeting.
  • Noting the Minutes of the Meetings of the Committees.
  • The fact that an Interested Director did not participate in the discussions and did not vote on an item of business in which he was interested and in case of a related party transaction such director was not present in the meeting during discussions and voting on such item.

  • Any item not included in agenda may be taken up for consideration with the Permission of chairman and with the consent of a majority of Director present in the meeting
  • Director shall not be counted for the purpose of quorum nor entitled to participate in respect of an item of business in which he is interested.
However, in the case of Private Company, a Director can participate in respect of such item after disclosure of interest.

  • The report of Board of Director shall include the Statement on Compliance of Applicable Secretarial Standards.

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