RULES FRAMED UNDER CHAPTER VII OF COMPANIES ACT, 2013: MANAGEMENT AND ADMINISTRATION.

 

rules

RULES FRAMED UNDER CHAPTER VII OF COMPANIES ACT, 2013: MANAGEMENT AND ADMINISTRATION 

Short title and commencement.

  1. These rules may be called the companies (Management and Administration) Rules, 2014.
  2.  In the official Gazette on their date of publication they shall come into force.
    1. Definitions.
    2.  In these rules, unless otherwise needs the context,
    3. “Act” means the Act of companies, 2013 (18 of 2013);
    4. “Annexure” means the rules of annexure;
    5. “Fees” means the specified keys of the companies (Registration offices and Fees) Rules, 2014;
    6. “Form” or e-form means Annexure form set forth to these rules which shall be utilized for the related matter.
    7. “Regional director” means the central government appoints the  Corporate Affairs ministry person as a Regional Director.
    8. “section” means the section of the Act;
    9. Expressions and words utilized in these rules and  not mentioned and mentioned in the companies or Act (Specification of Details definition)Rules, 2014 shall have meanings in the Act assigned respectively  to them and mentioned rules.
    10. BOARD MEETINGS THROUGH VIDEO CONFERENCING OR OTHER VISUAL AUDIO MEANS:
    11. A company with the following procedure shall comply, for convening and for conducting the meetings  of the board through video conferencing or means of other audio visual.
    12. Every company shall make the necessary arrangements to prevent failure video or audio video visual connection.
    13. The meeting of the chairperson and  the company secretary, if any, shall take reasonable care and due –
    14. a, to safe guard the integrity of meeting by ensuring security that are sufficient and for procedures of the identification.
    15. to ensure availability of proper video conferencing or other audio visual equipment of for providing  the communication facilities for  the directors effective participation and other authorized participants at the Board meeting;
    16. to record proceedings and prepare meeting minutes.
    17. to store for marking tape recording and safekeeping or other electronic mechanism recording as part of the records of the company at-least before the completion of the audit time particularly of that year;
    18. to ensure that no person other than the concerned director are attending or have access to the meeting proceedings through conferencing of the video mode or other audio visual means; and
    19. to ensure other than the concerned director no person are attending or have the proceedings of the meeting access through video conferencing mode or other audio visual means and
    20. to ensure the attending participants the meeting through audio visual means are able to see and hear clearly other participants during the course of the meeting.
    21. Provided that the persons who are differently abled, may make the request of the board to permit a person to accompany him.
    22. The meeting notice shall be sent to every directors in accordance with the provisions of sub-section (3) of section 173 of the Act.
    23. The notice of the meeting shall inform the the directors regarding the available option to participate to them through the mode of video conferencing or other means of audio visual, and shall provide all the necessary information to enable the directors to participate via video conferencing mode or other audio visual means.
    24. A intending director to participating through video conferencing or audio visual means shall communicate his the chairperson intention or  the company secretary.
    25. If the director intends to take part through video conferencing or other audio visual means, he shall give intimation prior to that effect sufficiently in advance so that is able to make the company arrangements suitable in this behalf.
    26. The director who desire, to indulge his participation may intimate intention through the electronic mode beginning at the calendar year and such declaration for one year calendar shall be valid.
    27. In any intimation absence under clause (c) it shall be assumed that the director shall attend in person the meeting.
    28. At the meeting commencement, a roll call shall be taken by the Chairperson when participating every director through video conferencing or other audio visual means shall state, for the record, namely the following:-
    29. a, name;
    30. b, the participating location.
    31.  that the agenda has been received and every relevant material for the meeting and
    32. that no one other than the director concerned is attending or having to the proceedings access at the location of the meetings mentioned in clause (b).
    33. After the roll call, the Company secretary or the Chairperson shall inform the Board about the persons names other than the present directors for the mentioned meetings at the request or with the Chairperson permission and confirm that the complete quorum required.
    34. Explanation.  A participating director in a meeting through video conferencing or other audio visual means for the purpose of quorum shall be counted, unless he is to be excluded for any business items under provisions of the Act or the rules.
    35. The Chairperson shall ensure that the quorum required is present throughout the meeting
    36. With respect to every meeting performed through video conferencing or other audio visual means under these rules authorized, the venue scheduled of the meeting as set forth in the notice convening the meeting, that shall be in India, shall be deemed to be the place of the meeting said and all proceedings recordings at the meeting shall be deemed at such place to be made.
    37. The registers statutory which are needed to be placed in the Board meeting as per the Act provisions shall be placed at the venue scheduled of the meeting and where such registers are needed by the directors to be signed, the same shall be deemed at such place to be made.
    38. The registers statutory which are needed to be placed in the Board meeting in accordance the provisions of the Act shall be placed at the meeting of the venue scheduled and where such registers are needed by the directors to be signed, the same shall be deemed to have signed by the directors participating through electronic mode, if they have given their consent to this effect and it is recorded of the meeting in the minutes.
    39. Every participant shall identify for the record himself before speaking of business on any item on the agenda.
    40. If a director statement in the meeting through video conferencing or other audio visual means is grabled or interrupted, the Chairperson or Company secretary shall request for a repeat or by the director reiteration.
    41. if a motion is objected to and there is need to put it to vote, the Chairperson shall call the roll and note each director vote who shall himself identify while casting his vote.
    42. From the meeting commencement and until such conclusion of the meeting, no person other than the Directors, Chairperson, Company secretary and any other person required such presence by the Board shall be allowed access to the place where any director attending the meeting either through video conferencing or physically without the Board permission.
    43. At the discussion end on each item of the agenda, the meeting Chairperson-shall announce the decision summary taken on such item along with the directors names, if any, who dissented taken by majority from the decision.
    44. The minutes shall disclose the directors particulars who attended the meeting through video conferencing or other visual audio means.
    45. The minutes of the draft meetings shall be circulated among every directors within fifteen days of the meetings either in writing or in electronic mode as by the Board may be decided.
    46. Every director who attended the meeting, whether through video conferencing or other audio visual means, shall confirm or give his comments on writing about the recordings accuracy of the proceedings of that particular meeting in the minutes of the draft, within seven days or some reasonable time  by the Board as decided,within seven days or some reasonable time by the Board as decided, after receipt of the minutes of draft failing which his approval shall be presumed.
    47. After the meeting completion, the minutes shall be entered in the book of the minute as specified under section 118 of the Act and by the Chairperson as signed.
    48. Explanation: For this rule purpose, “Video conferencing or other audio visual means” means audio visual electronic communication employed facility which enables all the persons participating in a meeting to communicate with each other currently without an intermediary and to effectively participate in the meeting.
    49. Matters not to dealt with in a meeting through video conferencing or other audio visual means.
    50. The following matters shall not be dealt held through video conferencing in any meeting or other audio visual means.
    51. The approval of the annual financial statements.
    52. The approval of the report of the Board’s.
    53. The approval of the prospectus;
    54. the Audit Committee Meetings  for consideration of accounts and
    55. the approval matter relating to amalgamation, demerger, merger, acquisition and takeover.
    56. Passing of resolution by circulation
    57. A resolution in draft may be circulated to the directors form together with the necessary papers for their approval seeking, by electronic means which may include tax or e-mail.
    58. Committees of the Board:
    59. The Listed every companies director’s board and the  following classes of the company shall constitute an Audit committee and  the Board committee of renumeration and the nomination of the board.
    60. All the public companies with  paid-up capital of more than ten crore rupees;
    61. all the public companies having turnover of more than one hundred crore rupees.
    62. all the public companies having in aggregate, borrowings outstanding or loans or deposits or debentures or extending deposits of more than fifty crore rupees .
    63. Explanation–The paid up share capital or outstanding loans or turnover or borrowings or deposits or debentures, as the case may be, as existing on the last audited Financial Statements audited shall be taken into account of this rule for the purposes.
    64. Vigil mechanism establishment.
    65. All the listed company and  belonging to the companies of the following classes or classes shall establish a vigil mechanism for their directors and report their genuine concerns of the employees or grievances.
    66. a, the companies which accepts the public deposits.
    67. b, the companies that borrows banks money and public financial institutions of excess fifty crore rupees.
    68. The companies which are needed to constitute an audit committee shall over see the mechanism vigil through the committee and if the committee members any have a conflict of interest in a given case, they should recuse themselves and on the  others committee would deal on the hand with the matter.
    69. In  other companies case, the Board of Directors shall nominate to play the committee of the audit role a director for the vigil mechanism purpose to whom other directors and employees  their concerns may report.
    70. The vigil mechanism shall give for adequate safeguard against employees victimization and directors who avail the vigil mechanism and also provide of Audit committee to the chair person for the direct access or the director nominated to play the  Audit Committee role, in exceptional as the case may be.
    71. In case of frivolous repeated complaints being filed by a director or an employee, the audit committee or the director nominated to play the role of the committee audit may take appropriate action against the director concerned or including reprimand of the employee.
    72. Powers of Board:
    73. In addition to the power under sub-section (3) of section 179 of the Act specified, the powers followed shall also be exercised by the directors board only by means of resolutions at the board meetings passed.
    74. to make political contributions.
    75. to appoint or to remove key managerial personnel (KMP) .
    76. to take note of appointments or  below the Management Personnel Key one level removal(s);
    77. to appoint-secretarial auditor and internal auditors;
    78. to take director’s interest of disclosure note and shareholding.
    79. to buy, sell investments that held the company( other than trade investment); constituting five per cent or increase of the paid up share capital and the company investee free reserves.
    80. to invite or accept or renewal of public deposit and related matters;
    81. The renewal of public deposits to invite or accept and matters related;
    82. to review or the public deposit terms and conditions to change.
    83. to approve quarterly, half yearly and annually financial statements or financial results as may be the case.
    84. Directors of interest disclosures.
    85. Every director shall disclose his concern or  in any company interest or bodies corporate( including  shareholders interest) or companies, firms or association of other individuals, by giving a Form notice MBP 1. written.
    86. It shall be the duty of the director giving notice of interest to cause it to be disclosed at the meeting held immediately after the date of notice.
    87. All notices at the registered office shall be kept and such notices for a period of eight years shall be preserved from the financial year end to which it relates and shall be kept in the company secretary custody of the company or any other authorized person for the purpose by the Board.
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