MCA RELAXES PROVISION OF BOARD MEETINGS DUE TO CORONA VIRUS (COVID- 19)

Companies (meetings of the board and its power) amendment rules, 2020.

Bearing in mind the need to take precautionary steps to overcome the eruption of the coronavirus (covid – 19), the government has in principle decided to relax the requirement of holding board meeting with the physical presence of directors under section 173 (2) read with rule 4 of the company (meeting of the board and its powers) Rules, 2014 for approval of the annual financial statement, board report, etc. such meeting may be held through video conferencing or other audiovisual means till 30th June 2020 to ensure compliance of rule 3.

Only such following restricted matters can be discussed which are otherwise not allowed-

a)    The approval of the annual financial statement

b)    The approval of the board report

c)    The approval of the prospectus

d)    The audit committee for consideration of financial statement including a consolidated financial statement in any, to be approved by the board under SS(1) of section 134 of the act and

e)    The approval of the matter relating to amalgamated, merger, demerger, acquisition and takeover.

Further, it was requested by the companies, whose board meeting is on or before 30th June 2020 and which are desirous seeking extension are advised by the MCA to file an application for extension of time limit to hold the AGM well in advance to avoid inconvenience. Alternatively, the MCA may advise all the registrar of companies to suo - moto grant extension up to 30th September 2020 to such companies.

THE INDISPENSABLE ALTERATIONS IN THE RULES IN THIS REGARD ARE ANTICIPATED TO BE NOTIFIED SOON. 

Author:

eStartIndia Team