1.

Powers which can be exercised by BoD by a resolution passed at a BM

[S. 179(3), R. 8 of Co (BM) Rules]

• to make calls on SH in respect of money unpaid on their shares;
• to authorize buy-back of securities u/s 68;
• to issue securities, including debentures, whether in or outside India;
• to borrow monies # (incl. the arrangement made by Co with its bankers for the borrowing of money by way of overdraft or cash credit or otherwise and not the actual day-to-day operation on overdraft, cash credit or other accounts by means of which the arrangement so made is actually availed of)
  • the acceptance by a Banking Co in the ordinary course of its business of deposits of money from the public repayable on demand or otherwise and withdrawable by cheque, draft, order or otherwise, or the placing of monies on deposit by a Banking Co with another Banking Co on such conditions as BoD may prescribe, shall not be deemed to be a borrowing of monies or, as the case may be, a making of loans by a Banking Co within the meaning of S. 179
  • Nothing shall apply to borrowings by a Banking Co from other Banking Co/RBI, SBI or any other banks established by or under any Act
• to invest the funds of the Co #;
• to grant loans or give guarantee or provide security in respect of loans #;
• to approve financial statement and the Board’s report;
• to diversify the business of the Co;
• to approve amalgamation, merger or reconstruction;
• to take over a Co or acquire a controlling or substantial stake in another Co;
• to make political contributions;
• to appoint or remove KMP;
• to appoint internal auditors and secretarial auditor;

# BoD may, by a resolution passed at a BM, delegate to any CoD, MD, manager or any other principal officer of the Co or in the case of a branch office of the Co, the principal officer of the branch office, these powers on such conditions as it may specify

2.

Matters not to be dealt with in a meeting through video conferencing or other audio visual means [R. 4 of Co (BM) Rules]

{Please also refer Special measures incl. Key CoVID 19 effects}

BMs: approval of -

• the annual FS, the Board’s report, the prospectus;

ACMs:

• consideration of (annual) FS including CFS, if any, to be approved by BoD u/s 134(1); and
• the approval of the matter relating to amalgamation, merger, demerger, acquisition and takeover

If there is quorum in a meeting through physical presence of directors ⟶ any other director may participate through video conferencing or other audio visual means in respect of the above mentioned matters

3.

Restrictions on powers of BoD

[S. 180]

BoD can exercise the following powers only with the consent of the Co by a Spl Reso:-

• to sell, lease or otherwise dispose of the whole or substantially the whole of the undertaking of the Co or where the Co owns > 1 undertaking, of the whole or substantially the whole of any of such undertakings
  • “undertaking” means an undertaking in which the investment of the Co > 20% of its net worth as per the audited balance sheet of the preceding FY or an undertaking which generates 20% of the total income of the Co during the previous FY
  • “substantially the whole of the undertaking” in any FY shall mean > 20% of the value of the undertaking as per the audited balance sheet of the preceding FY;
• to invest otherwise in trust securities the amount of compensation received by it as a result of any merger or amalgamation;
• to borrow money, where the money to be borrowed, together with the money already borrowed by the Co will >aggregate of its [paid-up share capital + free reserves + securities premium],
  • Excluding: temporary loans i.e. loans repayable on demand or within 6 months from the date of the loan such as short term, cash credit arrangements, the discounting of bills and the issue of other short-term loans of a seasonal character,
  • Including: loans raised for the purpose of financial expenditure of a capital nature

    obtained from the Co’s bankers in the ordinary course of business

  • Spl Reso to specify the total amount up to which monies may be borrowed by the BoD
  • Acceptance by a Banking Co, in the ordinary course of its business, of deposits of money from the public, repayable on demand or otherwise, and withdrawable by cheque, draft, order or otherwise, shall not be deemed to be a borrowing of monies by the Banking Co within the meaning of this clause
  • No debt incurred by the Co > the limit imposed by Spl reso shall be valid or effectual, unless the lender proves that he advanced the loan in good faith and without knowledge that the limit imposed by that clause had been exceeded
• to remit, or give time for the repayment of, any debt due from a director