Board meetings, Corporate Laws / SEBI / LLP

[Vishwanath Shetty]

I am working in a private limited company having 4 Directors(1 Indian & 3 foreign). It is 100% owned by foreign company. I want to know the yearly schedule of board meetings and is it compulsory. If we unable to conduct the board meetings what is the next procedure?

Posts / Replies

[Shiv Bansal]

As per section 285 of the Companies Act, 1956, every company must have at least 4 board meetings in a year and at least one meeting every quarter. There is no need  to ensure the time gap betweenthe two meetings. It means you may hold one meeting on 31st March and 2nd meeting on 1st April for the next quarter.Further the meeting may be held in any part of the world. Hence the foreign directors can hold the board meeting in their country and the Indian director may join the Board meeting through telephone/vedio conference. The only important point is that the quorum must be complete to hold the meeting which is 2 directors unless a higher quorum is provided in the Articles of association of the company.

Further now the board meeting may also be held through the Vedio conferencing as per MCA circula no 28/2011 dated 20-05-2011 but it states that each director must attend at least one meeting personally in a year and in such a scenario the indian director may visit abroad where the other three director reside for one meeting if the foreign directors can not visit or due to financial issues etc.

In case the board meetings are not hold as prescribed then there are penal provisions.

I hope this claries.

Thanks

S.R. Bansal