Gist of Section 173 and 174 of Companies Act 2013

Section 173 of of Companies Act 2013 -Meetings of Board

♦ First meeting within 30 days of its incorporation.

♦ Minimum four board meetings every year (maximum gap between 2 consecutive meetings can be 120 days).

♦ Participation may be either in person or through video conferencing or other audio visual means.

♦ Following matters cannot be dealt in a meeting through video conferencing or other audio visual means:

♦ the approval of the annual financial statements;

♦ the approval of the Board’s report;

♦ the approval of the prospectus;

♦ the Audit Committee Meetings for [consideration of financial statement including consolidated financial statement if any, to be approved by the board under sub-section (1) of section 134 of the Companies Act, 2013 ]; and

♦ the approval of the matter relating to amalgamation, merger, demerger, acquisition and takeover.

♦ Minimum 7 days notice required for calling board meeting at registered address of Director’s (by hand delivery/post/electronic means). Shorter notice can be given to transact urgent business.

♦ Every officer of the company whose duty is to give notice under this section and who fails to do so shall be liable to a penalty of twenty-five thousand rupees

Section 174 of of Companies Act 2013 – Quorum of Meetings of Board

♦ 1/3^rd(fractions shall be rounded off as one) of total strength(it shall not include directors whose places are vacant)

or

2 directors

(whichever is higher)

Participation through video/audio means shall also be counted for the purpose of quorum

♦  If interested directors ≥ 2/3^rd(fractions shall be rounded off as one) of total strength of BOD, then, the no. of directors who aren’t interested and present at the meeting(minimum 2), shall be the quorum.

♦ If meeting couldn’t held due to want of quorum, then meeting adjourned (unless AOA otherwise provide) to same day, time & place in next week (if that is national holiday then next succeeding day which is not a national holiday