1. Overview

It is an undisputed fact that a meeting of the Board of Directors is important. Company Formation in Gurgaon Delhi India under Companies Act, 2013 specifies some guidelines that make sure that the Board decisions are in accordance with the interests of the company, and that they also convey a fiduciary nature of director duties.

2. Periodicity of the Board Meetings

According to the Section 173 of the Act all public and private companies need to have. There need to be four meetings in a calendar year. However, if a company is registered under section 8 of the Companies Act, it has the choice of having a meeting of the Board or the Governing Body at least once in six calendar months vide Notification F. No. 1 /2/2014-CL.I dated 5th June 2015. A One Person Company, small company and dormant company shall have at least one meeting of the Board of Directors in each half of a calendar year.

3. Interval between two Board Meetings

According to the terms of section 173, maximum gap between two consecutive meetings cannot be more than 120 days in a calendar year. In case of One Person Company, small company and dormant company, the gap between the two meetings cannot be not less than ninety days.

4. Notice of Board Meeting

A meeting of the Board of directors should be held after giving notice, according to the Section 173 of the Companies Act. A meeting of the Board shall be called by giving not less than seven days’ notice in writing to every director at his address registered with the company and such notice shall be sent by hand delivery or by post or by electronic means Provided that a meeting of the Board may be called at shorter notice to transact urgent business subject to the condition that at least one independent director, if any, shall be present at the meeting.

5. Day of holding meeting

Board meetings are normally held during business hours and on a day, which is not a public holiday. However, a Board meeting may validly be held on public holiday. Department has clarified vide Letter No. 8/11(285)/63-PR, dated 2-5- 1963 that it would not raise any objection if an original Board meeting is not held on a working day for the convenience of the directors although it states that an original Board Meeting should be held on a working day.

6. Time of holding Board meetings

Board meetings can be held during non-business hours also. There is no restriction that only business hours have to be used.

7. Place for holding Board Meeting

A company’s registered office or head office or any other campus can be used to have the meeting, irrespective of the fact whether or not it is within the same city, town, village or state which houses the registered office. Meetings can also take place in another country. Participation of the directors by video conferencing or by other audio visual means shall also be valid.

8. Quorum of the Board Meeting

According to the Section 174 of the Companies Act, 2013, the quorum for a board meeting needs to be either two directors, or one-third of the total number of directors who are in office at that point, the higher of the two numbers. If the value of one-third obtained is a fraction, then it has to be rounded off to one. If a Company’s Board has 7 Directors, there will be three directors needed. If the number of interested directors is more than or equal to two-thirds of total number of directors, the disinterested directors present in the board, provided that the number is not less than two, deemed the quorum. Private companies also fall under this stipulation. For section 8 companies, the quorum for a board meeting needs to be either eight members or twenty five per cent, of its total strength whichever is less.

9. Time, day and place for holding adjourned Board Meetings

According to the section 174, where a meeting of the Board could not be held for want of quorum, then, unless the articles of the company otherwise provide, the meeting shall automatically stand adjourned to the same day at the same time and place in the next week or if that day is a national holiday, till the next succeeding day, which is not a national holiday, at the same time and place.

10. Directors cannot appoint a Proxy for Board Meetings

The continuing directors may act notwithstanding any vacancy in the Board; but, if and so long as their number is reduced below the quorum fixed by the Act for a meeting of the Board, the continuing directors or director may act for the purpose of increasing the number of directors to that fixed for the quorum, or of summoning a general meeting of the company and for no other purpose.