prpri Conducting of Board meetings through Video Conferencing (VC). Conducting of Board meetings through Video Conferencing (VC).

Every year, all Companies have to conduct at least 4 meetings of its Board and 1 meeting of its Members called Annual General Meeting. These meetings can be conducted either in physical mode or in Video Conferencing/Other Audio Visual Means mode. Earlier, there were restrictions on certain agenda items to be discussed in the Board meeting through Video Conferencing. Those were-

1. Approval of financial statements;

2. Approval of matter relating to merger/amalgamation;

3. Approval of matter relating to takeover/acquisition;

4. Approval of prospectus for issue of shares.

The provisions of Rule 4 of the Companies (Meeting of the Board and its powers) Rules, 2014 barred the Companies to conduct the Board meeting through Video Conferencing for the above mentioned agenda items. However considering the depth of COVID-19 pandemic and restrictions on the movement of persons, the Ministry of Corporate Affairs (MCA) vide its notification dated 15th June, 2021 omitted this rule and provided the Companies an option to conduct its all Board meetings through Video Conferencing irrespective of restricted agenda items mentioned above. By this relaxation, now Companies can approve their financial statements or matter relating to merger/amalgamation/takeover in a meeting held through Video Conferencing. However, this relaxation is not obligatory but optional to the Companies. The Companies can still conduct meetings through physical mode.

Along with this relaxation, the responsibility of the Company’s management increases. If Company proposes to conduct any Board meeting through Video Conferencing, it has to maintain video recording of the same as a proof of actual conduction of the meeting.

Some of the advantages of meeting through Video Conferencing are-

1. Physical presence of Directors at the venue of the meeting is not required;

2. Attendance to the meeting from any part of the world;

3. Saving of time and travelling cost.

In this regard, the Companies should think positively about holding of Board meetings through Video Conferencing subject to compliance of MCA rules.

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Disclaimer: The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. The entire contents of this document have been prepared on the basis of relevant provisions and rules and as per the information existing at the time of the preparation. Although care has been taken to ensure the accuracy, completeness and reliability of the information provided. I assume no responsibility therefore. Users of this information are expected to refer to the relevant existing provisions of applicable Laws. The user of the information agrees that the information is not a professional advice and is subject to change without notice. I assume no responsibility for the consequences of use of such information.

Author Bio

Qualification: CS
Company: Haartz Automotive India Private Limited
Location: Pune, Maharashtra, India
Member Since: 15 Jul 2020 | Total Posts: 3

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