Tuesday, 14 October 2014

Companies Act 1956: Minutes and business of a meeting

  • Minutes are records of meeting of the company.
  • Every company has to keep minutes for its general meetings.
  • Minutes are kept in the form of a book and they must contain summary of proceeding of the meeting.
  • The minutes must be true and clear and all information given in the minutes must be correct.
  • It is the discretion of the chairman to include any matter in the minutes.
  • The minutes of a meeting are signed by the chairman of meeting, after signing the minutes will be admissible as evidence in court of law.
  • Minutes can be inspected by any member of company.

Business in a meeting:
Every company holding a meeting can have two types of businesses to discuss.
  • Ordinary business
  • Special business

Ordinary Business:
It is the business done by ordinary resolution and these resolutions can be passed by simple majority. Following are the ordinary business:
  • Adoption of accounts
  • Appoint of directors
  • Appointment of auditors
  • Dividend Declaration

Special business:
Any business which is not an ordinary business is a special business. E.g,
  • Merger/Demerger
  • Closure of business
  • Taking loans
  • Issuing shares and Debentures

For passing special resolution it is necessary that 75% or more votes are obtained and the notice of meeting mentions that the resolution is special. It is also necessary that explanatory note is given along with the notice of resolution.

Resolutions requiring special notice:

Sometimes the members of company propose some resolution and they give the notice of it to the company, in this case the resolution is given to the company by the member and company will give the copy of resolution to all the members this resolution has a special notice and it will also be taken up in the meeting.

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