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TMI BlogChapter XII - The Companies (Meetings of Board and its Powers) Rules, 2014.X X X X Extracts X X X X X X X X Extracts X X X X ..... ans the Annexure appended to these rules; (c) "Fees" means the fees as specified in the Companies (Registration Offices and Fees) Rules, 2014; (d) "Form" or "e-Form" means a form set forth in Annexure to these rules which shall be used for the matter to which it relates; (e) "Related party" means a director or key managerial personnel of the holding company or his relative with reference to a company, shall be deemed to be a related party; (f) "section" means the section of the Act. (2) Words and expressions used in these rules but not defined and defined in the Act or in the Companies (Specification of Definitions Details) Rules, 2014, shall have the same meanings respectively assigned to them in the Act or in the said Rules. 3. Meetings of Board through video conferencing or other audio visual means.- A company shall comply with the following procedure, for convening and conducting the Board meetings through video conferencing or other audio visual means. (1) Every Company shall make necessary arrangements to avoid failure of video or audio visual connection. (2) The Chairperson of the meeting and the company secretary, if any, shall take due and reasonable care - ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the meeting, a roll call shall be taken by the Chairperson when every director participating through video conferencing or other audio visual means shall state, for the record, the following namely:- (a) name; (b) the location from where he is participating; (c) that he has received the agenda and all the relevant material for the meeting; and (d) that no one other than the concerned director is attending or having access to the proceedings of the meeting at the location mentioned in clause (b); (5) (a) After the roll call, the Chairperson or the Company Secretary shall inform the Board about the names of persons other than the directors who are present for the said meeting at the request or with the permission of the Chairperson and confirm that the required quorum is complete. Explanation.- A director participating in a meeting through video conferencing or other audio visual means shall be counted for the purpose of quorum, unless he is to be excluded for any items of business under any provisions of the Act or the rules. (b) The Chairperson shall ensure that the required quorum is present throughout the meeting. (6) With respect to every meeting conducted thr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... means, shall confirm or give his comments in writing, about the accuracy of recording of the proceedings of that particular meeting in the draft minutes, within seven days or some reasonable time as decided by the Board, after receipt of the draft minutes failing which his approval shall be presumed. (c) After completion of the meeting, the minutes shall be entered in the minute book as specified under section 118 of the Act and signed by the Chairperson. Explanation.- For the purposes of this rule, "video conferencing or other audio visual means" means audio- visual electronic communication facility employed which enables all the persons participating in a meeting to communicate concurrently with each other without an intermediary and to participate effectively in the meeting. 4. Matters not to be dealt with in a meeting through video conferencing or other audio visual means.- (1) The following matters shall not be dealt with in any meeting held through video conferencing or other audio visual means.- (i) the approval of the annual financial statements; (ii) the approval of the Board's report; (iii) the approval of the prospectus; (iv) the Audit Committee Meetings for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ptional cases. (5) In case of repeated frivolous complaints being filed by a director or an employee, the audit committee or the director nominated to play the role of audit committee may take suitable action against the concerned director or employee including reprimand. 8. Powers of Board.- In addition to the powers specified under sub-section (3) of section 179 of the Act, the following powers shall also be exercised by the Board of Directors only by means of resolutions passed at meetings of the Board.- (1) to make political contributions; (2) to appoint or remove key managerial personnel (KMP); (3) to take note of appointment(s) or removal(s) of one level below the Key Management Personnel; (4) to appoint internal auditors and secretarial auditor; (5) to take note of the disclosure of director's interest and shareholding; (6) 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; (7) to invite or accept or renew public deposits and related matters; (8) to review or change the terms and conditions of public deposit; (9) to approve quarterly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any guaranty or security for due repayment of any loan availed by any person in the ordinary course of its business". (3) No company registered under section 12 of the Securities and Exchange Board of India Act, 1992 and also covered under such class or classes of companies which may be notified by the Central Government in consultation with the Securities and Exchange Board, shall take any inter-corporate loan or deposits, in excess of the limits specified under the regulations applicable to such company, pursuant to which it has obtained certificate of registration from the Securities and Exchange Board of India. 12. Register.- (1) Every company giving loan or giving guarantee or providing security or making an acquisition of securities shall, from the date of its incorporation, maintain a register in Form MBP 2 and enter therein separately, the particulars of loans and guarantees given, securities provided and acquisitions made as aforesaid. (2) The entries in the register shall be made chronologically in respect of each such transaction within seven days of making such loan or giving guarantee or providing security or making acquisition. (3) The register shall be kept at th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot holding the investments in its own name and the relationship or contract under which the investment is held in the name of any other person. (2) The company shall also record whether such investments are held in a third party's name for the time being or otherwise. (3) The register shall be maintained at the registered office of the company. The register shall be preserved permanently and shall be kept in the custody of the company secretary of the company or if there is no company secretary, any director or any other officer authorised by the Board for the purpose. (4) The entries in the register shall be authenticated by the company secretary of the company or by any other person authorised by the Board for the purpose. 15. Contract or arrangement with a related party.- A company shall enter into any contract or arrangement with a related party subject to the following conditions, namely:- (1) The agenda of the Board meeting at which the resolution is proposed to be moved shall disclose- (a) the name of the related party and nature of relationship; (b) the nature, duration of the contract and particulars of the contract or arrangement; (c) the material terms of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lakh rupees as mentioned in clause (f) of sub-section (1) of section 188; or (c) remuneration for underwriting the subscription of any securities or derivatives thereof of the company exceeding one percent. of the net worth as mentioned in clause (g) of sub-section (1) of section 188. Explanation.- (1) The Turnover or Net Worth referred in the above sub-rules shall be on the basis of the Audited Financial Statement of the preceding Financial year. (2) In case of wholly owned subsidiary, the special resolution passed by the holding company shall be sufficient for the purpose of entering into the transactions between wholly owned subsidiary and holding company. (3) The explanatory statement to be annexed to the notice of a general meeting convened pursuant to section 101 shall contain the following particulars namely:- (a) name of the related party ; (b) name of the director or key managerial personnel who is related, if any; (c) nature of relationship; (d) nature, material terms, monetary value and particulars of the contract or arrangement; (e) any other information relevant or important for the members to take a decision on the proposed resolution. 16. Register o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (g) manner of payment - whether payable in cash or otherwise and how; (h) sources of payment; and (i) any other relevant particulars as the Board may think fit. (2) Any payment made by a company by way of compensation for the loss of office or as a consideration for retirement from office or in connection with such loss or retirement, to a managing director or whole time director or manager of the company shall not exceed the limit as set out under section 202. (3) No payment shall be made to the managing director or whole time director or manager of the company by way of compensation for the loss of office or as consideration for retirement from office (other than notice pay and statutory payments in accordance with the terms of appointment of such director or manager, as applicable) or in connection with such loss or retirement if - (a) the company is in default in repayment of public deposits or payment of interest thereon; (b) the company is in default in redemption of debentures or payment of interest thereon; (c) the company is in default in repayment of any liability, secured or unsecured, payable to any bank, public financial institution or any other financia ..... X X X X Extracts X X X X X X X X Extracts X X X X
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