January 2021
The Ministry of Corporate Affairs (“MCA”) issued the Companies (Meetings of Board and its Powers) Fourth Amendment Rules, 2020 on December 30, 2020 to extend the due date for convening the board meetings through Video Conferencing (“VC”) from December 31, 2020 to June 30, 2021.
Rule 4 of the Companies (Meetings of Board and its Powers) Rules, 2014 restricts certain matters to approve in a board meeting held through VC. Such matters are: (a) approval of annual accounts, (b) approval of the board’s report, (c) approval of prospectus, (d) convening of audit committee meetings for consideration of annual accounts, and (e) approval of matters pertaining to amalgamation, merger, demerger, acquisition and takeover.
Given the COVID crisis, the MCA had amended Rule 4 and allowed the matters listed in points (a) to (e) above to approve in a board meeting held through VC and accordingly, there was no longer a requirement for physical board meeting till June 30, 2020. Subsequently, the MCA extended this deadline till December 31, 2020.
Recently, the MCA further extended this deadline from December 31, 2020 to June 30, 2021 keeping in mind the ongoing COVID crisis. That said, companies will have to follow the mandatory requirements of holding a board meeting through VC.
By:
Jaya Moorjani