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Meetings of the Board of Directors

SS - Old - 01 - Rule - Companies Law - SS - Old - 01 - SS-1 Secretarial Standard on The following is the text of the Secretarial Standard-1 (SS-1) issued by the Council of the Institute of Company Secretaries of India, on . In the initial years, adherence by a company to this Secretarial Standard will be recommendatory. Introduction This Standard seeks to prescribe a set of principles for the convening and conduct of and matters related thereto. The principles enunciated in this Standard for are .....

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e a duty to the shareholders and should exercise care, skill and diligence in the discharge of their functions and in the exercise of the powers vested in them. All the powers vested in Directors are exercisable by them only collectively. As an individual Director, no Director has the power to act on behalf of the company unless such powers have been delegated to him by the Board. Definitions The following terms are used in this Standard with the meaning specified: Act means the Companies Act, 1 .....

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ttee of the Board. Disinterested Director means a Director who is not an Interested Director . Interested Director means a Director whose presence cannot count for constituting a quorum and who can neither participate in the discussion nor vote on an item of business since he is, directly or indirectly, concerned or interested in the contract or arrangement forming part of the business under consideration by the Board. Meeting means a Meeting, duly convened and constituted, of the Board or any C .....

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. Such information includes financial results, intended declaration of dividend, announcement of bonus, rights shares and other corporate benefits, issue of securities, any major expansion plans or execution of new projects, amalgamation, merger and takeover, de-mergers, compromise or arrangement with creditors and members, disposal of the whole or substantially the whole of the undertaking, any changes in policies, plans or operations of the company, and such other information as may affect the .....

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scimile or by e-mail or by any other electronic mode. Where a Director specifies a particular mode, the Notice should be given to him by such mode. 1.2-2 The Notice should specify the day, date, time and full address of the venue of the Meeting. A Meeting may be held at any time, on any day, including a public holiday, and at any place. 1.2-3 The Notice of a Meeting should be given even when Meetings are held on pre-determined dates or at pre-determined intervals. 1.2-4 Unless the Articles presc .....

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the business to be transacted at the Meeting, and Notes on Agenda should be given at least seven days before the date of the Meeting. 1.2-7 Each item of business should be supported by a note setting out the details of the proposal and, where approval by means of a Resolution is required, the draft of such Resolution should be set out in the note. 1.2-8 The Notice, Agenda and Notes on Agenda may be given at shorter periods of time than those respectively stated above, if the majority of members .....

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s on Agenda have been given to the Alternate Director. 1.2-9 Any supplementary item not originally included in the Agenda may be taken up for consideration with the permission of the Chairman and with the consent of the majority of the Directors present in the Meeting. However, no supplementary item which is of significance or is in the nature of unpublished price sensitive information should be taken up by the Board without prior written Notice. The items of business to be transacted should be .....

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ustrative list of such items is given at Annexure A . There are certain specific items which should be placed before the Board at its first Meeting and there are certain items which should be placed before the Board at the Meeting held for consideration of the year-end accounts. Illustrative lists of such items are given at Annexures B and C respectively. 2. Frequency of Meetings 2.1 Meetings of the Board The Board should meet at least once in every three months, with a maximum interval of 120 d .....

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ent. The Quorum for a Meeting of the Board should be one-third of the total strength of the Board (any fraction contained in that one-third being rounded off as one), or two Directors, whichever is higher. Where the requirements for the Quorum, as provided in the Articles, are stricter, the Quorum should conform to such requirements. If the number of interested Directors exceeds or is equal to two-thirds of the total strength, the remaining Directors present at the Meeting, being not less than t .....

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blic holiday, to the next succeeding day which is not a public holiday, at the same time and place. 3.2 Meetings of Committees The presence of all the members of any committee constituted by the Board is necessary to form the Quorum for meetings of such Committee unless otherwise stipulated by the Board while constituting the Committee. Certain guidelines, Rules and Regulations framed under the Act or by any statutory authority may contain provisions for the Quorum of a Committee and such stipul .....

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own. 4. Attendance at Meetings 4.1 An Attendance Register, containing the names and signatures of the Directors present at the Meeting, should be maintained. If an attendance register is maintained in loose-leaf form, it should be bound at reasonable intervals and may be destroyed after eight years, with the approval of the Board. 4.2 Leave of absence should be granted to a Director only when a request for such leave has been communicated to the Secretary or to the Board or to the Chairman. 5. C .....

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ed and generally in the order in which the items appear on the Agenda. The Chairman should encourage deliberations and debate and assess the sense of the Meeting. The Chairman should ensure that the proceedings of the Meeting are correctly recorded and, in doing so, he may include or exclude any matter as he deems fit. In the case of a public company, if the Chairman himself is interested in any item of business, he should entrust the conduct of the proceedings in respect of such item to any oth .....

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all the Directors or, in the case of a Committee, to all the members of the Committee. The Act requires certain matters to be approved at only. Though the Act permits that all other matters can be approved by means of Resolutions by circulation, it would be appropriate if only those matters, which are of an urgent nature are approved by means of Resolutions by circulation. 6.2 The draft Resolution to be passed by circulation and the necessary papers should be circulated by hand, or by post, or b .....

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r Committee, as the case may be, and recorded in the Minutes of such Meeting. 7. Accounts 7.1 The annual accounts of a company should be approved at a Meeting of the Board and should not be approved by means of a Resolution passed by circulation. 7.2 Quarterly or half-yearly financial results should be approved at a Meeting of the Board or its Committee and should not be approved by means of a Resolution passed by circulation. 7.3 In the case of a listed company, if there is any material varianc .....

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comments on the draft Minutes within 15 days from the date of circulation thereof, so that the Minutes are finalised and entered in the Minutes Book within the specified time limit of thirty days. 8.2 The Minutes of proceedings of a Meeting should be entered in the Minutes Book within thirty days from the conclusion of the Meeting. In case a Meeting is adjourned, the Minutes should be entered in respect of the original Meeting as well as the adjourned Meeting within thirty days from the date of .....

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that Minutes of the proceedings should be entered in the Minutes Book within thirty days of the Meeting, there is no prescribed time limit within which such Minutes have to be signed. They could be signed beyond a period of thirty days if the succeeding Meeting is held after a period of thirty days from the date of the earlier Meeting. However, it is also not obligatory to wait for the next Meeting in order to have the Minutes of the previous Meeting signed. Such Minutes may be signed by the Cha .....

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r regulatory bodies duly authorised in this behalf under law, during the course of an inspection, can also inspect the Minutes. 8.5 Minutes should not be pasted or attached to the Minutes Book. 8.6 Minutes, if maintained in loose-leaf form, should be bound at intervals coinciding with the financial year of the company. The pages of the Minutes Book should be serially numbered and there should be proper locking device to ensure security and proper control to prevent irregular removal of the loose .....

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y way of express approval taken in the subsequent Meeting in which such Minutes are sought to be altered. 8.10 The Minutes of Meetings of any Committee should be circulated to the Board along with the Agenda for the Meeting of the Board next following such Meeting of the Committee and should be noted at the Board Meeting. If the Minutes of Meetings of any Committee are pending noting by the Committee at the time of circulating the Agenda for the Meeting of the Board, such Minutes should be circu .....

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ecorded. Similarly, the fact that an interested Director did not participate in the discussion or vote should be recorded in the Minutes. 9.4 Wherever any approval of the Board or of the Committee is taken on the basis of certain papers laid before the Board or the Committee, proper identification by initialling of such papers by the Chairman or any Director should be made and a reference thereto should be made in the Minutes. 10. Preservation of Minutes and other Records 10.1 The Minutes of all .....

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od order for as long as they remain current or for ten years, whichever is later, and may be destroyed thereafter under the authority of the Board. 11. Disclosure The Annual Report of a company should disclose the number of Meetings of the Board and Committees held during the year indicating the number of Meetings attended by each Director. Effective Date This standard shall come into effect from 13th December, 2001. Annexure A Illustrative list of items of business which should be placed before .....

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rest by a Director. 11. Receiving notice of disclosure of Directors interest. 12. Receiving notice of disclosure of Directors shareholdings. 13. Appointment or Resignation of Managing Director or Whole-time Director or Manager. 14. Appointment and removal of the Chief Financial Officer and the Company Secretary. 15. Appointment of sole-selling agents. 16. Making a declaration of solvency where it is proposed to wind up the company voluntarily. 17. Forfeiture of shares. 18. Taking note of the qua .....

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osecutions and penalty notices of material nature. 27. Any material effluent or pollution problems, industrial accidents, labour problems, signing of wage agreement, implementation of Voluntary Retirement Scheme, etc. 28. Any issue which involves possible public or product liability claims. 29. Transactions that involve substantial payment towards goodwill, brand equity, or intellectual property. 30. Foreign exchange exposures and the steps taken by management to limit the risks of adverse excha .....

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l/financial implications, such as: (a) strikes, lockouts, lay-off, closure of units/factory, etc.; (b) change in the general character or nature of business; (c) major expansion plans or execution of new projects; (d) disruption of operations due to natural calamity or Act of God; (e) commencement of commercial production/commercial operations; (f) developments with respect to pricing/realisation arising out of change in the regulatory framework; (g) litigation/dispute with a material impact; (h .....

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thereon; (n) any action which will result in alteration in the terms regarding redemption/cancellation/retirement in whole or in part of any securities issued; (o) information regarding opening, closing of status of ADR, GDR or any other class of securities issued abroad; (p) cancellation of dividend/rights/bonus, etc.; (q) formation of a subsidiary company and/or de-subsidiarisation of an existing subsidiary company. Annexure B Illustrative list of items of business for the Agenda for the First .....

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ectors. 7. To consider the appointment of Additional Directors. 8. To consider the appointment of the Chairman of the Board. 9. To fix the financial year of the company. 10. To consider the appointment of the first Auditors. 11. To adopt the Common Seal of the company. 12. To appoint Bankers and to open bank accounts of the company. 13. To authorise printing of share certificates. 14. To authorise the issue of share certificates to the subscribers to the Memorandum and Articles of Association of .....

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