Regulation 14(2)(f) of LODR
(1) The Board of Directors2(10) Board of Directors, in relation to a company, means the collective body of the directors of the company of a company2(20) Company means a company incorporated under this Act or under any previous company law shall be entitled to exercise all such powers, and to do all such acts and things, as the company is authorised to exercise and do:
Provided that in exercising such power or doing such act or thing, the Board shall be subject to the provisions contained in that behalf in this Act, or in the memorandum2(56) Memorandum means the memorandum of association of a company as originally framed or as altered from time to time in pursuance of any previous company law or of this Act or articles2(5) Articles means the articles of association of a company as originally framed or as altered from time to time or applied in pursuance of any previous company law or of this Act, or in any regulations not inconsistent therewith and duly made thereunder, including regulations made by the company in general meeting:
Provided further that the Board shall not exercise any power or do any act or thing which is directed or required, whether under this Act or by the memorandum or articles of the company or otherwise, to be exercised or done by the company in general meeting.
(2) No regulation made by the company in general meeting shall invalidate any prior act of the Board which would have been valid if that regulation had not been made.
(3) The Board of Directors of a company shall exercise the following powers on behalf of the company by means of resolutions passed at meetings of the Board, namely:—
(a) to make calls on shareholders in respect of money unpaid on their shares2(84) Share means a share in the share capital of a company and includes stock ;
(b) to authorise buy-back of securities2(81) Securities means the securities as defined in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) under section 68;
(c) to issue securities, including debenture2(30) Debenture, includes debenture stock, bonds or any other instrument of a company evidencing a debt, whether constituting a charge on the assets of the company or not
Provided that— (a) the instruments referred to in Chapter III-D of the Reserve Bank of India Act, 1934; and
(b) such other instrument, as may be prescribed by the Central Government in consultation with Reserve Bank of India, issued by a company,
shall not be treated as debenture;, whether in or outside India;
(d) to borrow monies; In respect of section 8 companies, matters referred to in clauses (d), (e) and (f) of sub-section (3) may be decided by the Board by circulation instead of at a meeting vide notification no. G.S.R. 466(E) dated 5th June, 2015.
(The exceptions, modifications and adaptations provided above shall be applicable only to those companies covered under section 8 of the said act which has not committed a default in filing its financial statements under section 137 of the said act or annual return under section 92 of the said act with the registrar, vide notification dated 13th June, 2017)
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(e) to invest the funds of the company; In respect of section 8 companies, matters referred to in clauses (d), (e) and (f) of sub-section (3) may be decided by the Board by circulation instead of at a meeting vide notification no. G.S.R. 466(E) dated 5th June, 2015.
(The exceptions, modifications and adaptations provided above shall be applicable only to those companies covered under section 8 of the said act which has not committed a default in filing its financial statements under section 137 of the said act or annual return under section 92 of the said act with the registrar, vide notification dated 13th June, 2017)
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(f) to grant loans or give guarantee or provide security in respect of loans; In respect of section 8 companies, matters referred to in clauses (d), (e) and (f) of sub-section (3) may be decided by the Board by circulation instead of at a meeting vide notification no. G.S.R. 466(E) dated 5th June, 2015.
(The exceptions, modifications and adaptations provided above shall be applicable only to those companies covered under section 8 of the said act which has not committed a default in filing its financial statements under section 137 of the said act or annual return under section 92 of the said act with the registrar, vide notification dated 13th June, 2017)
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(g) to approve financial statement2(40) Financial Statement in relation to a company, includes—
(i) a balance sheet as at the end of the financial year;
(ii) a profit and loss account, or in the case of a company carrying on any activity not for profit, an income and expenditure account for the financial year;
(iii) cash flow statement for the financial year;
(iv) a statement of changes in equity, if applicable; and
(v) any explanatory note annexed to, or forming part of, any document referred to in sub-clause (i) to sub-clause (iv):
Provided that the financial statement, with respect to one person company, small company, dormant company and private company (if such private company is a start-up)may not include the cash flow statement;
Explanation. – For the purposes of this Act, the term ‘start-up’ or “start-up company” means a private company incorporated under the Companies Act, 2013 (18 of 2013) or the Companies Act, 1956 (1 of 1956) and recognised as start-up in accordance with the notification issued by the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry. and the Board’s report;
(h) to diversify the business of the company;
(i) to approve amalgamation, merger or reconstruction;
(j) to take over a company or acquire a controlling or substantial stake in another company;
(k) any other matter which may be prescribed:Refer rule 8 of the Companies (Meetings of Board and its Powers) rules,2014. To view the rule,Click Here
Provided that the Board may, by a resolution passed at a meeting, delegate to any committeeRefer circular 19/2014. To view the clarification,Click Here of directors, the managing director2(54) Managing Director means a director who, by virtue of the articles of a company or an agreement with the company or a resolution passed in its general meeting, or by its Board of Directors, is entrusted with substantial powers of management of the affairs of the company and includes a director occupying the position of managing director, by whatever name called.
Explanation.—For the purposes of this clause, the power to do administrative acts of a routine nature when so authorised by the Board such as the power to affix the common seal of the company to any document or to draw and endorse any cheque on the account of the company in any bank or to draw and endorse any negotiable instrument or to sign any certificate of share or to direct registration of transfer of any share, shall not be deemed to be included within the substantial powers of management., the manager2(53) Manager means an individual who, subject to the superintendence, control and direction of the Board of Directors, has the management of the whole, or substantially the whole, of the affairs of a company, and includes a director or any other person occupying the position of a manager, by whatever name called, whether under a contract of service or not. or any principal officer of the company or in the case of a branch office2(14) Branch Office, in relation to a company, means any establishment described as such by the company of the company, the principal officer of the branch office, the powers specified in clauses (d) to (f) on such conditions as it may specify:
Provided further that the acceptance by a banking company2(9) Banking Company means a banking company as defined in clause (c) of section 5 of the Banking Regulation Act, 1949 (10 of 1949) 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 company with another banking company on such conditions as the Board 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 company within the meaning of this section.
Provided also thatInserted vide Exemption Notification to specified IFSC Public Companies, GSR 08 (E) dated 04.01.2017. To view the notification Click Here in case of a Specified IFSC public company2(71) Public Company, means a company which—
(a) is not a private company; and
(b) has a minimum paid-up share capital, as may be prescribed:
Provided that a company which is a subsidiary of a company, not being a private company, shall be deemed to be public company for the purposes of this Act even where such subsidiary company continues to be a private company in its articles., the Board can exercise powers by means of resolutions passed at the meetings of the Board or through resolutions passed by circulation.
Provided also thatInserted vide Exemption Notification to specified IFSC Private Companies, GSR 09 (E) dated 04.01.2017. To view the notification Click Here in case of a Specified IFSC private company, the Board can exercise the powers by means of resolutions passed at the meetings of the Board or through resolutions passed by circulation.
Explanation I.—Nothing in clause (d) shall apply to borrowings by a banking company from other banking companies or from the Reserve Bank of India, the State Bank of India or any other banks established by or under any Act.
Explanation II.—In respect of dealings between a company and its bankers, the exercise by the company of the power specified in clause (d) shall mean the arrangement made by the company 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.
(4) Nothing in this section shall be deemed to affect the right of the company in general meeting to impose restrictions and conditions on the exercise by the Board of any of the powers specified in this section.
12.1.8-Companies (Meetings of Board and its Powers) Rules,2014
8. Powers of Board.-
In addition to the powers specified under sub-section (3) of section 179 of the Act, the following powers shall also be exercised by the Board of Directors only by means of resolutions passed at meetings of the Board.-
(1) to make political contributions;
(2) to appoint or remove key managerial personnel (KMP);
(3) to take note of appointment(s) or removal(s) of one level below the Key Management Personnel; Omitted vide Notification No. G.S.R. 206 (E) dated 18th March, 2015. To view the notification,Click Here
(4) to appoint internal auditors and secretarial auditor;
(5) to take note of the disclosure of director’s interest and shareholding;Omitted vide Notification No. G.S.R. 206 (E) dated 18th March, 2015. To view the notification,Click Here
(6) to buy, sell investments held by the company (other than trade investments), constituting five percent or more of the paid up share capital and free reserves of the investee company;Omitted vide Notification No. G.S.R. 206 (E) dated 18th March, 2015. To view the notification,Click Here
(7) to invite or accept or renew public deposits and related matters;Omitted vide Notification No. G.S.R. 206 (E) dated 18th March, 2015. To view the notification,Click Here
(8) to review or change the terms and conditions of public deposit;Omitted vide Notification No. G.S.R. 206 (E) dated 18th March, 2015. To view the notification,Click Here
(9) to approve quarterly, half yearly and annual financial statements or financial results as the case may be.Omitted vide Notification No. G.S.R. 206 (E) dated 18th March, 2015. To view the notification,Click Here
Companies (Meetings of Board and its Power) [GSR 206 E] dated 18/03/2015
Enforcement Notification S.O. 902(E) dated 26/03/2014
Exemption to Specified IFSC Private company [GSR 09(E)] dated 04/01/2017
Exemption to Specified IFSC Public company [GSR 08(E)] dated 04/01/2017
Exemptions to Section 8 Companies [Amendment to GSR 466(E)] dated 13/06/2017