MCA Extends Time Gap between Two Consecutive Board Meetings

Because of the difficulties being faced by the stakeholders due to the resurgence of the Second Wave of the COVID-19 pandemic, the Ministry of Corporate Affairs (MCA) has relaxed the norm around the time gap between two consecutive board meetings of companies in a financial year. The MCA vide its General Circular No. 08/2021 dated 03^rd May 2021 announced that the time gap between two consecutive board meetings may extend to 180 days against 120 days allowed earlier. The current article briefs the extension so provided. Know more about the Company Board Meeting through Video Conference

Extension of Time Gap between Two Consecutive Board Meetings

Because of the difficulties arising due to the resurgence of the COVID-19 pandemic and request received from stakeholders, the Ministry of Corporate Affairs (“MCA”) has decided that the requirement of holding the meeting of the Board of the Companies within intervals provided in Section 173 of the Companies Act, 2013 (120 days) stands extended by period of Sixty (60) days for first two quarters of the financial year 2021-2022. Accordingly, the gap between two consecutive meetings of the Board may extend to 180 days during the quarter – April to June 2021 and Quarter – July to September 2021, instead of 120 days as required in the Companies Act 2013.

The norm for Holding Board Meetings

Section 173 of the Companies Act, 2013 mandates that a minimum of Four board meetings have to be held in a year with a gap of not more than 120 days between any consecutive two meetings.

Every company need to hold the first meeting of the Board of Directors within thirty days of the date of its incorporation
Every company shall need to hold a minimum number of four meetings of its Board of Directors every year in such manner that not more than one hundred and twenty days shall intervene between two consecutive meetings of the Board

Know more about the First Board Meeting of Company

Revised Norm for Holding Board Meeting

As per the MCA General Circular No. 08/2021 dated 03^rd May 2021, it is stated that the period of 120 days shall be counted as 180 days till the next two quarters i.e. Quarter – April to June 2021 and Quarter – July to September 2021. More clarity, if any Board Meeting is going to be held between 1^st April 2021 to 30^th September 2021, the period of 120 days mentioned in Section 173 of the Act shall be read as 180 days.

Procedure to Conduct Board Meetings

As mentioned above, every company shall hold the first meeting of the Board of Directors within thirty days of the date of its incorporation and thereafter hold a minimum number of four meetings of its Board of Directors every year in such a manner that not more than one hundred and twenty days shall intervene between two consecutive meetings of the Board:

Condition for the participation of directors

The participation of directors in a meeting of the Board may be either in person or through video conferencing or other audiovisual means, as may be prescribed, which are capable of recording and recognizing the participation of the directors and recording and storing the proceedings of such meetings along with date and time: Know more about the Companies (Meetings of Board and its Powers) Rules

Notice to Conduct Board Meetings

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: 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: