A company from incorporation to closing of business is guided by the provisions of the Companies Act, 2013 and related rules, hence evidently, minutes are also governed by the Companies Act, 2013. These minutes are proof of happening of a specific event in a company and whenever, the documents of company are demanded by any department, the very first is generally minutes of the Company.
And one such recording of all the meeting of the company is drafted and called as Minutes.
I will brief you about Board meeting minutes in this article as the provision for Board Meeting minutes and General Meeting minutes varies and also in order to avoid any kind of hotchpotch, I penned this separately. I hope you enjoy as well as gain knowledge by reading this article which is prepared in question answer format.
What is minute/(s) under the Companies act 2013?
Minutes, also known as minutes of meeting, protocols or, informally, notes, are the instant written record of a meeting or hearing. They typically describe the events of the meeting and may include a list of attendees, a statement of the issues considered by the participants, and related responses or decisions for the issues depending upon the Law they are governed under.
Which section/provision governs preparation of minutes?
The provision of 118 of the Companies Act, 2013 governs the preparation of the Board Meeting Minutes of company and it also mandates a company to observe Secretarial Standard -1 issued by The Institute of Company Secretaries of India for preparation of minutes of a company.
Note that One-person company (OPC) and Section 8 company are not required to observe secretarial Standard-1 issued by The Institute of Company Secretaries of India.
Is it mandatory to prepare minutes?
Yes, as per section 118 of the Companies Act, 2013 every company whether: –
- Private Company
- One-person company (OPC)
- Public Company
- Section 8 company
- Nidhi Company
- Foreign Company, etc.
4. How many types of minutes?
Minutes are prepared for each and every kind of meeting including: –
- Board Meeting
- Shareholder’s Meeting like Annual General Meeting and Extra-ordinary meeting.
- Audit Committee Meetings
- Nomination and Remuneration Meetings
- Stakeholders Meetings
- Corporate Social Responsibility Meetings, etc.
- Any other meeting as per the applicability of any other committee meetings.
5. How to prepare Board Meeting Minutes?
Minutes are prepared in simple narrative form and plain language which a reader can understand by reading them. Generally, they are prepared in physical mode and binding them in minutes books from time to time.
But yes, they can be maintained in Electronic mode also, in such case a company will timestamp them.
6. Who prepares Board Meeting Minutes?
The Company Secretary shall record the proceedings of the Meetings. Where there is no Company Secretary, any other person duly authorised by the Board or by the Chairman in this behalf shall record the proceedings.
7. In how many days they should be prepared?
Minutes should be drafted within and circulated to the directors for their finalization and then within fifteen days (15) and should be signed and entered in the minute book or get timestamped in case of physical and electronic maintenance mode respectively in case of Board Meeting and Any committee meetings.
8. Is it mandatory to get them signed and if yes then in how many days?
Minutes should be entered in the minute book within thirty (30) days from the Board meeting. Hence, they should be signed on or before thirty (30) days.
9. What is the manner to get Board Meeting Minutes signed?
The Minutes of the Meeting of the Board shall be signed and dated by the Chairman of the Meeting or by the Chairman of the next Meeting.
Minutes of the previous Meeting may be signed either by the Chairman of such Meeting at any time before the next Meeting is held or by the Chairman of the next Meeting at the next Meeting.
Each and every page should be initialled and last page of each Board Meeting should be signed by Chairman as mentioned above.
In case of electronically maintained Board meeting minutes, the chairman shall sign minutes digitally.
10. Can minutes be prepared electronically?
As mentioned above, yes minutes can prepared and maintained electronically but they should be properly timestamped.
11. Is there any place to keep minutes?
Minutes Books shall be kept at the Registered Office of the company or at such other place as may be approved by the Board and should be under the custody of Company Secretary if any, or any other person as authorised by Board.
12. For what period minutes should be kept by company?
Minutes of all Meetings shall be preserved permanently in physical or in electronic form with Timestamp.
Where, under a scheme of arrangement, a company has been merged or amalgamated with another company, Minutes of all Meetings of the transferor company, as handed over to the transferee company, shall be preserved permanently by the transferee company, notwithstanding that the transferor company might have been dissolved.
13. Can minutes be altered?
Once signed by the Chairman, shall not be altered. Hence, number of alterations can be made in minutes but this all should be done before get them signing from Chairman.
14. What if a company do not prepare or maintain minutes?
If no minutes are prepared, in respect of any Board Meeting, the company shall be liable to a penalty of twenty-five thousand rupees and every officer of the company who is in default shall be liable to a penalty of five thousand rupees.
Also note, if a person is found guilty of tampering with the minutes of the proceedings of meeting, he shall be punishable with imprisonment for a term which may extend to two years and with fine which shall not be less than twenty-five thousand rupees but which may extend to one lakh rupees.
Disclaimer: – The above article is prepared keeping in mind all the important and basic question as well as provision of section 118 of the Companies Act, 2013 and The secretarial Standard-1 issued by The Institute of Company Secretaries of India which comes in mind of a professional or other stakeholder while preparing Board Meeting Minutes. The author has tried to cover all the important and basic question. Under no circumstance, the author shall not liable for any direct, indirect, special or incidental damage resulting from, arising out of or in connection with the use of the information