section 174 of the companies act 2013 - QUORUM FOR BOARD MEETING
PrintListen to this Article
SECTION 174 OF THE COMPANIES ACT 2013 - QUORUM FOR BOARD MEETING
Quorum here means the minimum number of directors to be present at the board meeting in order to hold the board meeting. The provisions related to the minimum no. of directors i.e. quorum is provided u/s 174 of the companies Act 2013.
This section provides that the quorum of the board meeting should be 1/3rd of total strength or 2 directors whichever is higher. Total strength hereon shall not include directors whose place is vacant. However if the no. of continuing directors is less than the required quorum of the meeting then such continuing directors can hold a meeting only for two purposes :-
- To hold a general meeting of the company.
- To increase the number of directors to that fixed for the quorum
Any fraction in the number should be taken as 1. In case any director is attending meeting through video conferencing or other audio visual means then no. of these directors shall also be taken into consideration. This provision of minimum no. of director is applicable for both private as well as public company.
In case interested directors are present in the meeting and their no. is equal to or more than 2/3rd of the total strength of the board of directors then in that case the quorum of the meeting should be the number of remaining directors present at the meeting or two directors whichever is higher. Hereon also total strength shall not include directors whose place is vacant.
Now the question arises in our mind is what happens if the required quorum is not present at the meeting. Section 174(4) provides that in case the quorum is not present at the meeting then the board meeting cannot be held and will be adjourned to the same day same time and same place of the next week. In case that day is a public holiday, then to the next succeeding day which is not a public holiday. However the Article of the company can provide otherwise and in that case the AOA of the company will supersede this section.
Category : Corporate Law | Comments : 0 | Hits : 520
Introduction The practice of a company keep track of its financial transactions is as old as trade itself. The upkeep of precise books of accounts has been vital for the long-term prosperity and viability of businesses, going back to the days of barter systems and continuing into today’s complex financial systems. This essay will examine the importance of books of accounts and all of the benefits they provide to companies of all kinds. What are Books of Accounts? The s...
Introduction In India, registering a company is a complex procedure. A company’s incorporation process involves a number of officials, including chartered accountants and company secretaries. These individuals make a significant contribution to the company registration procedures available in India. However, one such entity is frequently overlooked during the incorporation process. It can be easy to overlook the Company Registrar who issued the registration certificate in these si...
Introduction Due diligence is an inquiry or audit conducted before a transaction, such as an acquisition, investment, business partnership, or bank loan, to guarantee compliance with financial, legal, and environmental reports in order to register a company in India. The outcomes of all these inquiries and audits will be collected into a Due Diligence report. For startups in India, conducting due diligence about the company is important during the investment stage. To guarantee complian...
Introduction India is a country that attracts a lot of private equity and foreign direct investment (FDI) due to its rapid expansion. India has the second-largest population in the world and a wealth of skilled IT workers, which makes it an appealing destination for investment from foreign businesses and individuals. This article will explain why establishing an Indian subsidiary is not as tough as you may believe. In this article, we will also include information on What is an Indian S...
The mandatory dematerialisation requirement is applicable on all securities of every private company, excluding small companies and government companies. The provisions are applicable with immediate effect, and a timeline of 18 months is provided from the closure of the financial year in which a private company is not a small company for the compliance with the mandatory dematerialisation requirements. For example, a private company (other than a company that is a small company as on 31st Marc...
Comments