Sub: Clarification regarding gap between two board meetings under section 173 of the Companies Act, 2013
The Ministry of Corporate Affairs vide its circular dated 03rd May 2021 has relaxed the requirement of Section 173(1) of the Companies Act, 2013, in view of the difficulties arising due to resurgence of COVID-19 pandemic.
It has been clarified by the Ministry that the requirement of holding Board Meetings of the companies within the interval of 120 days as provided in section 173(1) of the Act shall stand extended by 60 days for first two quarters of the Financial Year 2021-22.
Accordingly, the gap between two consecutive meetings of the Board may extend to 180 days during the quarter-April to June 2021 and quarter July to September 2021, instead of 120 days as required in the Companies Act, 2013.
For Instance, if a Company’s first Board Meeting has been held on 01st April, 2021 and second Board Meeting on 27th September 2021, then the same would not be viewed as violation of the provisions of the Act, as the same has been conducted within 180 days.
Circular is available at the link-http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo8_03052021.pdf
Members may take note of the above and plan accordingly.
Chairman and Vice Chairman
Corporate Laws & Corporate Governance Committee
The Institute of Chartered Accountants of India