CA Chandra M. Jain
Resolution or Agreement to be filed: Section 117(1) of Company Act, 2013 with Rule 24 of Companies (Management & Administration) Rule 2014 [w.e.f 01.04.2014]
A copy of every resolution or any agreement in mentioned section 117 (3) together with the explanatory statement under section 102 shall be filed with the Registrar within thirty days of the passing of resolution in Form No. MGT-14 along with Fee.
Name of Resolution or Agreement to be filled: Section 117(3) of Companies Act, 2013
The provisions of this section shall apply to—
1. special resolutions;
2. resolutions which have been agreed to by all the members of a company, but which, if not so agreed to, would not have been effective for their purpose unless they had been passed as special resolutions;
3. any resolution of the BOD of a company or agreement executed by a company, relating to the appointment, re-appointment or renewal of the appointment, or variation of the terms of appointment, of a managing director;
4. resolutions or agreements which have been agreed to by any class of members but which, if not so agreed to, would not have been effective for their purpose unless they had been passed by a specified majority or otherwise in some particular manner; and all resolutions or agreements which effectively bind such class of members though not agreed to by all those members;
5. resolutions passed by a company according consent to the exercise by its BOD of any of the powers under section 180 (1) (a) and 180(1) (c) ;
6. resolutions requiring a company to be wound up voluntarily passed by member of company in section 304;
7. resolutions passed by BOD in pursuance of section 179(3); and
8. any other resolution or agreement as may be prescribed and placed in the public domain
Resolution in relating to Section 180(1) (a) of Companies Act, 2013
to sell, lease or otherwise dispose of the whole or substantially the whole of the undertaking of the company or where the company owns more than one undertaking, of the whole or substantially the whole of any of such undertakings.
Definition of Undertaking [Explanation of 180(1) (a) of Companies Act, 2013]
“Undertaking” shall mean an undertaking in which the investment of the company exceeds twenty per cent. of its net worth as per the audited balance sheet of the preceding financial year or an undertaking which generates twenty per cent. of the total income of the company during the previous financial year;
Definition of substantially the whole of the undertaking [Explanation of 180(1) (a) of Companies Act, 2013]
“Substantially the whole of the undertaking” in any financial year shall mean twenty per cent or more of the value of the undertaking as per the audited balance sheet of the preceding financial year;
Resolution in relating to Section 180(1) (c) of Companies Act, 2013
to borrow money, where the money to be borrowed, together with the money already borrowed by the company will exceed aggregate of its paid-up share capital and free reserves, apart from temporary loans (repayable on demand or within six months) obtained from the company’s bankers in the ordinary course of business.
Resolution in relating to business transaction covered under section 179(3) with Rule 8 of Companies (Meeting of Board and its Powers) Rule, 2014
1. to make calls on shareholders in respect of money unpaid on their shares;
2. to authorise buy-back of securities under section 68
3. to issue securities, including debentures, whether in or outside India;
4. to borrow monies;
5. to invest the funds of the company;
6. to grant loans or give guarantee or provide security in respect of loans;
7. to approve financial statement and the Board’s report;
8. to diversify the business of the company;
9. to approve amalgamation, merger or reconstruction;
10. to take over a company or acquire a controlling or substantial stake in another company;
11. to make political contributions;
12. to appoint or remove key managerial personnel (KMP);
13. to take note of appointment(s) or removal(s) of one level below the Key Management Personnel; [One level below KMP is not define in the Act] 1
14. to appoint internal auditors and secretarial auditor;
15. to take note of the disclosure of director’s interest and shareholding; 1 16. to buy, sell investments held by the company (other than trade investments), constituting five percent or more of the paid up share capital and free reserves of the investee company; 1 17. to invite or accept or renew public deposits and related matters; 1 18. to review or change the terms and conditions of public deposit; 1 19. to approve quarterly, half yearly and annual financial statements or financial results as the case may be. 1
Copy of Proposed special resolution in respect to register of members under section 88 and copies of Annual Return under section 92 may also kept at any other place (not registered office) in India, in advance to be filed with the Register at least one day before the date of general meeting.
Definition of KMP: Section 2(51) of Companies Act, 2013
Key managerial personnel”, in relation to a company, means—
i. the Chief Executive Officer or the managing director or the manager;
ii. the company secretary;
iii. the whole-time director;
iv. the Chief Financial Officer; and
v. such other officer as may be prescribed;
Appointment of KMP: Section 203 of Act with Rule 8 of Companies (Appointment and Remuneration of Managerial Personal) Rule, 2014
Every listed company and every other public company having a paid up share capital of 10 crore or more shall have whole time key managerial personnel.
Whether MGT-14 should be filled appointment, removal of director in the private company
As per company law, KMP is not required the appointment in the private company so that in case of appointment, or removal of director in the private company, MGT-14 is not filed with Registrar.
Disclosure of Interest by Directors under CA, 2013
As per section 184(1) of Companies Act,
Every director shall:
· At the first meeting of the Board in which he participates as a director; and thereafter
· At the first meeting of the Board in every financial year or
· Whenever there is any change in the disclosures already made, then at the first Board meeting held after such change,
disclose his concern or interest in any company or companies or bodies corporate, firms, or other association of individuals which shall include the shareholding, in such manner as may be prescribed.
As per section 184(1) read with rule 9(1) of Companies (Meetings of Board and its Powers) Rules, 2014, Every director shall disclose his concern or interest in any company or companies or bodies corporate (including shareholding interest), firms or other association of individuals, by giving a notice in writing in Form No. MBP1.
Requirement of filing form MGT.14 for disclosure of interest by Director As per Section 117(1), certain resolutions and agreements as required by section 117(3) are required to be submitted with ROC through filing form MGT14 .Section 117(3) also refers matter given in section 179(3) are also required to be reported via MGT.14. As per section 179(3)(k) read with rule 8(5) of Companies (Meetings of Board and its Powers) Rules, 2014, taking note of the disclosure of director’s interest and shareholding shall be done by the Board only by means of resolutions passed at meetings of the Board. Hence it is duty of the company to pass board resolution to take note of disclosure of interest by Director and file a copy of that board resolution in MGT14 within 30 days of passing board resolution. Now it is a matter of discussion that whether form MBP1 regarding disclosure of director’s interest is also required to be attached through form MGT14 along with copy of resolution passed u/s 184(1).
Penalty: Section 117(3) of Companies Act, 2013
Company –Rs. 5 lakh rupees – Rs. 25 lakh rupees
Officer of the company (including Liquidator) – Rs. 1 lakh rupees- Rs. 5lakh rupees.
Whether MGT-14 should be filed for resolution passed on 31.03.2014
Section 117 is notified from 1st April, 2014, there is no requirement for filling the Form MGT-14 for resolution passed on 31st March, 2014
The company shall conduct the first board meeting up to 12o days from the last board meeting shown in last financial year 2013-14. The company shall file the form MGT-14 for disclosure of interest by director within 30days from the first board meeting.
1. Delete the words or paragraphs vide Notification No. GSR 206(E) [F.NO. A-1/32/2013-CL-V-PART] dated 18.03.2015
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