by cs makarand joshi partner mmjc - icsi
TRANSCRIPT
BY CS Makarand Joshi Partner MMJC
Section 118 (10)
Every Company shall observe Secretarial
Standard (SS) with respect to General and
Board Meeting issued by ICSI
“Shall” make the SS Mandatory
SS1– Secretarial Standards on Meetings of the
Board of Directors
SS2- Secretarial Standards on General meeting
SS-1 and SS-2 approved by the Central
Government on April 10, 2015
Issued by ICSI via Notification No. 1 (SS) of
2015 dated April 23, 2015
Effective from 1st July 2015
Section 205 (1)
The function of the Company Secretary shall include –
(b) To ensure that the Company complies with applicable
Secretarial standards
Annual return
A PCS Certifying the Annual Return shall to certify
compliances of the provisions of the Act which also include
compliance of Secretarial Standards.
Standards states that SS are in conformity with the
provision of the Act
However, If due to subsequent changes in the act, SS
or part thereof become inconsistent with law, the
provision of said law shall prevail
Sec118 (11) provides for a penalty of Rs
25000/- on the company and Rs 5000/- on
officer
To meetings of Board of Directors of all companies
except OPC in which there is only one director on its
Board
To all committee(s) meetings of the Board, unless
otherwise stipulated under any other applicable
Guidelines, Rules or Regulations
Any Director may Summon a meeting
CS or any person authorized by Board in
consultation with Chairman/WTD/MD may
convene a meeting
CS
Director
Any person authorized by Board
At any time and on any day except National Holiday
Adjourned meeting for want of quorum shall also not
be held on a National Holiday
Unlike Annual General Meeting, Board Meeting can
be held at any place i.e. can be held out of India also
Physically attending the meeting
E- mode
However, in case of restricted items = E-mode
= Chairman consent = Neither counted as
quorum = Nor counted for voting
Notice of Board Meeting in writing to be sent by
By hand
Registered post
Speed Post Additional 2 days shall be added for svs
Courier = Total 9 days
Other E-mode
◦ To be sent 7 days before the meeting at registered postal address or
in absence, as provided in DIN unless otherwise stated in AOA
◦ Notice shall be given even if meetings are held on Pre-determined
dates
◦ In case meetings are held at Shorter Notice – the fact shall be stated
in Notice
◦ Send to all directors (incl. original director)
Courier is not mentioned in section 173
Serial No. , day, date, time and full address of Venue
Where participation through E-mode
Inform director about such facility
Notice shall seek advance confirmation from directors as to whether they will participate
Proof of sending and their delivery is to be maintained
Each item to be numbered of agenda to facilitate reference or cross reference
Supplementary notes to be circulated prior to start of meeting (can be sent at shorter notice in case of UPSI with the consent of majority of directors, including ID)
Coverage
Details of proposal, relevant material facts indicating implication of the proposal, Nature of Concern or interest if any (if disclosed by director)
May be transacted by circulating notice specifying
fact that meeting is convened at shorter notice
Presence of at least one Independent Director (ID), if
any or ratification thereof
No ID, required consent of majority directors at a
meeting or ratification later
Board Meeting
First BM – Within 30 days from the date of
Incorporation
One meeting in each calendar quarter, subject to max
interval of 120 days
However OPC/Small Company or Dormant
Company – One meeting in each half of a calendar
year (Gap between two meetings is not less than 90
days)
For Board – 1/3rd or 2 or as per AOA
Quorum required throughout meeting
Interested director not to be counted
Participant through video conf. is counted
For Committee = all members unless otherwise specified in ACT / AOA / BOD
Scope widened = includes himself and his relatives
Interested Director = refrained from participating in Voting
and Discussion [However private companies are exempted
from se.184(2)]
This will require minutes to record the fact of the director
having left the room/left the VC facility.
In case of chairman also – Chairman required to handover the
chair to disinterested director and vacate the room
Chairman or MD or WTD, where there is none any director other
than Interested Director shall decide before the circulation of draft
resolution
Resolution proposed to be passed shall be sent in draft, together
with necessary papers, individually to all directors including
interested director on the same day
Such business to be explained by way of note setting out the details
of the proposal, relevant material facts that enable the Directors to
understand the meaning, scope and implications of the proposal, the
nature of concern or interest, if any, of any Director in the proposal,
which the Director had earlier disclosed and the draft of the
Resolution proposed.
Every resolution shall carry Serial Number
Resolution shall be deemed to have been passed on the last date
specified for signifying assent or dissent by the Directors or the date
on which assent from more than two-third of the Directors has been
received, which ever is earlier, and shall be effective from that date,
if no other effective date is specified in such Resolution
In cases where the interest of a Director is yet to be communicated
to the company, the concerned Director shall disclose his interest
before the last date specified for the response and abstain from
voting.
Serial No
Type of Meeting
Date
Director, CS, Invitee to sign
In case of presence via E –mode, deemed to be signed
if recorded by CS/Chairman
PAGE numbering is required
Entries required to be authenticated by CS /
Chairman
Maintain in Physical or Electronic Form with Timestamp
Bound periodically depending upon size and volume
coinciding with one or more financial years of the company
Follow uniform and consistent form for maintaining
minutes, any deviation shall be authorised by the Board
Minutes of the preceding meeting shall be noted at meeting
held immediately following the date of entry of such minutes
in the minutes book
Serial No. of Meeting
Type of meeting, Day, Date, Place Venue of Meeting
The time of commencement and conclusion of the Meeting
Directors Present (Alphabetically, however, Chairman - first)
Election of Chairperson, if any
Presence of Quorum
Leave of absence
Mode of Attendance of every director
CS in attendance and name of invitee
Noting of minutes of preceding meeting , minutes of committees
The text of resolution passed by circulation since the last meeting
including dissent or abstention, if any
The fact that an Interested director was not present during the
discussion and did not vote
If director has participated only for a part of the meeting, the
Agenda items in which he did not participate
The fact to dissent and name of director who dissented from the
resolution or abstained from voting thereon
Ratification by Independent Director or majority of Directors,
as the case may be, in case of Meetings held at a shorter Notice
and the transacting of any item other than those included in the
Agenda
The brief background of all proposals and summarize the
deliberations thereof. In case of major decisions, the rationale
there of shall also be mentioned.
Decisions shall be recorded in the form of Resolutions, where it is
statutorily or otherwise required. In other cases, the decisions can be
recorded in a narrative form
Where a Resolution was passed pursuant to the Chairman of the
Meeting exercising his second or casting vote, the Minutes shall
record such fact
Proof of sending draft Minutes within 15 days from the date of
conclusion and its delivery shall be maintained by the company.
The Directors, whether present at the Meeting or not, shall
communicate their comments, if any, in writing on the draft Minutes
within seven 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
A Director, who ceases to be a Director after a Meeting of the Board
is entitled to receive the draft Minutes of that particular Meeting and
to offer comments thereon, irrespective of whether he attended such
Meeting or not.
Date of Meeting (x)
Circulation of Draft Minutes (X+15)
Comments on Draft Minutes (X + 22)
Entry of Minutes in the Minutes Book (X+30)
Signing of Minutes (Anytime at or before next board meeting) (Y)
Circulation of signed Minutes Certified by the CS or where no CS by Director (Y+15)
Minutes of Meeting
• Permanently in physical or in electronic form
Office copies of notices, agenda, Notes on agenda and other related papers
• As long as remain current
• 8 Financial years
• Whichever is later
• Destroyed thereafter with the approval of Board
Will non adherence of SS will
invalidate the transaction??
Numbering of Meeting / Minutes / Circular
Resolution / Attendance Register
Notice = 7+2 days
Preservation of Delivery Proof mandatory
Minutes to carry rationale of decision and details of
deliberation
Chairman has casting vote by default
Lot of dos and dont’s
Board shall convene General Meeting
Board may call EOGM on requisition
Such requisition shall not pertain to any item of
business that is required to be mandatorily
transacted by postal ballot
Ordinary post not allowed for e-voting / postal ballot
Notice shall be displayed on the website of the Company
No business shall be transacted at a meeting if notice in accordance with Standards is not given
Accidental omission shall not invalidate the meeting
If at shorter notice, notice shall be sent with request for shorter notice. But meeting to be held only if consent is received prior to date.
Attendance Slip and Proxy form to be accompanied with notice
By default meeting shall be held for which notice given. If it has to be reconvened, it can be done with 3 days intimation
Route map to be given in notice
EOGM to be held in India only
Quorum shall be through out the meeting
Proxy shall be excluded for determining quorum
One person can act as repr. Of more than one body corporate. However for quorum 2 individuals are required
Related party shareholder is counted for purpose of quorum
Quorum not applicable for postal ballot
Audit Committee Chairman shall attend
Chairman shall explain the reason for absence of any director
Directors and CS to be seated with Chairman
Auditor to attend General Meetings
Secretarial Auditor to attend AGM
Chairman of the Board shall be chairman of general meeting
Chairman shall explain the objective and implication of resolution
Chairman to offer opportunity to members to offer comments on any business
He shall not conduct proceedings, if he is interested …
Proxy need not be member except for se. 8 company
Proxy form is valid only for that meeting or any adjourment thereof
Proxy to prove identity while attending
Rules for valid / invalid proxy
Proxy of later date revokes earlier proxy
Undated revocation shall not be accepted
If member attends, proxy stands revoked
Requisition for inspection of proxy should be before 3 day of meeting. 24 hour – 0 hours.
Every resolution to be proposed & Seconded
Wherever e-voting is mandatory ballot is to be provided
E –voting does not dispense with Meeting
Unless e –voting / poll, decision to be done by show of hands
Unless AOA provides otherwise, Chairman has casting vote
Related Party shareholder not to vote
Chairman shall appoint scrutinizers, as he deems necessary
PCS / CA in practice / CWA in practice /advocate or any other person
At least one scrutinizer shall be member
Scrutinizer shall not be employee
Resolution which may affect price of securities can not be withdrawn
Resolution proposed through e-voting can not be withdrawn
Resolution passed can be rescinded by another resolution passed at subsequent meeting
No modification to any resolution which is put to e-voting
No modification to alter substantially
Modification should be put to vote first… and if approved by requisite majority, modified resolution can be put to vote…
Qualification, observation or comments or remarkrs on fin. Statements having adverse effect on functioning of company to be read
Expl. Given in directors report should also be read
Similar comments in SAR should also be read
If quorum is not present meeting will be adjourned; otherwise
Chairman can adjourn with consent of members
In case it is impossible to conduct the meeting, meeting may be adjourned
If adjourned for less than 30 days, notice of 3 days; if beyond 30 days … normal notice
If adjourned for want of quorum, same time- same day- next week
Applicable for meetings / E – Voting and Postal Ballot
Member scrutinizer is mandatory
Casting vote to Chairman
Detailed process w.r.t each step…
By default there is no question on validity of the transaction unless… oppressive to minority / prejudicial to interest of company…etc.
