Submission to Ministry of Corporate Affairs requesting for further relaxation in provisions relating to conduct of physical board meetings.
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COVID-19 has spread rapidly across the globe, causing significant disruption in businesses. In these unprecedented times, India has surpassed Brazil to become the second –worst-hit country by COVID-19, as infections continue to accelerate.
As per S.173 of Companies Act, 2013 (Act), participation of directors in Board Meeting may be either in person or through video conferencing or other audio visual means capable of recording and recognizing the participation of directors as well as recording and storing the proceedings of meetings. Further, as per Rule 4 of Companies (Meetings of Board and its Powers) Rules, 2014 (Rules), certain matters are not allowed to be dealt with in any meeting held through video conferencing or other audio visual.
In this regard, Ministry of Corporate Affairs (MCA) had earlier lifted restrictions on meetings conducted through video conferencing and enabling companies to conduct all the meeting proceedings through audio-visual means, for a period up to September 30, 2020.
Given the ongoing circumstance of surging infections, many countries around the world still have in place travel/visa restrictions and are taking continued taking steps to curtail international travel of people. Hence, it will not be prudent in the current circumstances for companies to have an in-person gathering of senior executives and board members at one place.
In this regard, NASSCOM made a submission to MCA requesting to extend the relief relating to conduct of physical board meetings till March 31, 2021, as the corporates are currently unable to assess the time period it will take for business to resume to normal conditions.
We will engage with MCA to get clarity on the above aspect. We will keep you posted on further developments in this regard.
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