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Can regulation made by the company in general meeting invalidate any prior act of the Board which would have been valid if that regulation had not been made.
No
Can the powers of board given under section 179 be deemed to affect the right of the company in general meeting to impose restrictions on such powers of board
No
What are the powers which board can exercise through passing resolution AT MEETING (Not via circulation)
- Borrow monies
- Grant loans, give guarantee , security
- Make investments
- Amalgamation ,merger, reconstruction
- Acquisition, takeover
- Diversifcation
- Call on unpaid shares
- Authorise BB
- Issue securities, incl deb inside or outside india
- Approve FS and board report
- Make political contributions
- Appoint or remove KMP
- Appoint internal auditor and secretarial auditor
How to delegate, to whom and what powers can be delegated
- BM resolution
- Delegate to any committee of directors, MD , Manager, principal officer of main office or branch
- Powers to borrow, invest , grant loans, security , guarantee
Exception for sec. 8 co.?
Powers to borrow, invest , grant loans, security , guarantee - Decided by board by circulation instead of meeting
Company can contribute to bonafide and charitable funds?
Prior per mission - GM , if
aggregate amount in any FY exceeds 5% of avg. net profits for immediately preceeding 3 FYs
Can a company contribute to national defence fund if prohibited by articles
A company NOT withstanding any provisions of this act / memorandum/ articles can contribute any amount to National Defence Fund or any other Fund approved by the Central Government for the purpose of national defence.
Only condition - disclose in PL
Prohibition in delegation of powers of board w.r.t. investment
- No investment shall be made or loan or guarantee or security given by the company
- resolution sanctioning it is passed at a meeting of the Board
- consent of all the Directors present at the meeting
- prior approval of the public financial institution concerned where any term loan is subsisting (subject to conditions)
When should prior approval of public financial institution where loan is subsisting should be taken
When aggregate of the loans investment, guarantee , security so far made along with what is proposed exceeds sixty per cent. of its paid-up share capital, free reserves and securities premium account or one hundred per cent. of its free reserves and securities premium account, whichever is more.
When should co. take spl resolution while borrowing money
money to be borrowed, together with the money already borrowed by the company
will exceed aggregate of paid-up share capital and free reserves and securities premium
This doesnt apply to temporary loans taken in ordinary course of biz. which are not in capital nature and repayable within 6 month or on demand
Applicability of audit committee and nomination and remuneration committee ( same for independent director)
- Listed public co.
- Public co. having PSC >= 10 crore more
- Public co. having turnover of 100 cr. or more
- Public co. having in aggregate o/s loans, debentures or deposits exceeding 50 cr.
as per last audited B/S
Exceptions:
- Unlisted public cos.:
- JV
- WOS
- Dormant co.
Constituents of Audit commitee
- Min 3 dir
- Maj ID
- Maj , incld chairperson ability to read and understand financial statements
Role and powers of audit committee vis-a-vis statutory auditor
- The auditor shall only the services approved by AC
- Recommend , appointment , remuneration ,terms
- Review and monitor auditor’s independence, performance ,effectiveness
- Examine FS & Auditor’s report
