Omission of restriction on conducting Board Meeting through Audio Visual Means for certain matters listed in Rule 4 of the Companies (Meetings of Board and its Powers) Rules, 2014 –– Welcome Step by Ministry of Corporate Affairs
Amidst compliance chaos during the pandemic running in the country, Ministry of Corporate Affairs has come up with a welcoming amendment on 15th June 2021 vide its notification number G.S.R. 409(E) serial no. No. 325, which omitted Rule 4 of the Companies (Meetings of Board and its Powers) Rules, 2014 by way of introduction of the Companies (Meetings of Board and its Powers) Amendment Rules, 2021 (“amended rules”), now allowing conduct of Virtual Board Meeting for any matter which may be required to be considered by the Companies. Click here for Notification.
The amended rules incorporated an omission of Rule 4 of the Companies (Meetings of Board and its Powers) Rules, 2014 which listed out the matters which were not allowed to be dealt with in meeting though video conferencing or other audio-visual means as listed below:
- The approval of the annual financial statements;
- The approval of the Board’s report;
- The approval of the prospectus;
- The Audit Committee Meetings for 2[consideration of financial statement including consolidated financial statement if any, to be approved by the board under sub-section (1) of section 134 of the Act]; and
- The approval of the matter relating to amalgamation, merger, demerger, acquisition and takeover.
Now, as per the effect of the amended rules, the above-mentioned matters can be taken up by the companies for approval through video conferencing/ other audio visual means and this amendment has been welcomed by the majority class of companies due to travelling restrictions around the globe and also reducing the risk of getting affected by the pandemic brewing around everywhere. This shall also be a step towards promotion of social distancing and staying at home guidelines of the Government.
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