Companies Act, 2013 Key implications

The Companies Act, 2013 has brought in several new compliances that are to be
adhered to by the companies. Some of these are

filing the board resolutions in certain situations;

incorporation of the key changes introduced in the new Act into the existing

Memorandum and Articles of Association of the company;

printing of new stationery like letterheads etc wherein the CIN of the

company is to be compulsorily mentioned;

ensuring at least one director is a person resident in India;
confirming none of the directors are disqualified u/s 164 (S.274 of the

erstwhile law);
forming of the CSR Committee (applicable for companies with a networth of
Rs.500 crores or more (OR) Turnover of Rs.1000 crore or more (OR) Net

profit of Rs.5 crore or more);

providing for powers available to the Board only by way of passing a
resolution and the same should be taken note of in the first Board meeting

after the commencement of the new Act;

filing of certain board resolutions with the RoC in e-form MGT-14 with respect

to certain aspects within 30 days;

appointment of company secretary, wherever applicable, and the duties of
the CS should be taken note of in the first BM of the company;

ILLUSTRATIVE AGENDA FOR THE BOARD MEETINGS OF THE COMPANY TO BE

HELD AFTER THE COMMENCEMENT OF THE COMPANIES ACT, 2013
1.
2.
3.
4.

Appointment of chairman
Review of minutes of previous board meeting
Grant of leave of absence
To review and restructure composition of board of directors in accordance

with requirements of companies act, 2013

5. To constitute csr committee in accordance with requirements of companies
act, 2013
6. To discuss on revised requirements relating to maintenance of statutory
registers, minutes book and share certificates in accordance with provisions
of companies act, 2013
7. To consider, approve and adopt new letter head /official documents of the
company in accordance with requirements of companies act, 2013
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Companies Act, 2013 Key implications

8. To take note of notices of disclosure of concern or interest in any company or
companies or bodies corporate (including shareholding interest), firms or
other association of individuals by directors (first board meeting in the
financial year)
9. To recommend amendment of memorandum and articles of association of the
company in accordance with requirements of companies act, 2013
10.
Renewal of limits for borrowing /investment/ guarantee/ security etc. In
accordance with provisions of section 180 and 186 of companies act, 2013
and other matters as may be required.
11.
To consider and recommend for approval by special resolution by
shareholders all related party transactions under section 188 of the
companies act 2013.
12.
Consideration and approval of annual accounts for the financial year
ended 31.03.2014 and the report of auditors, directors thereon and corporate
governance report
13.
Fixing the time, place and date for convening annual general meeting
for the FY ended 31.03.2014
14.
Consideration and approval of draft notice of AGM
15.
Recommending the appointment of statutory auditors for the financial
year 2014-2015
16.
Recommending the appointment of internal auditors for the financial
year 2014-2015
17.
Appointment of practising company secretary for certification/signing
of annual return

Out of the above, the following are to be done in the first board meeting of the
company preferably within June 2014:
1. Resolution pertaining to adoption of new stationery;
2. Resolution for amending the M&A of the company for incorporating the
provisions of the new Act;
3. Resolution for revision of board composition, maintenance of books of
accounts and other registers;
4. Resolution for disclosure of interest by the directors in any other concern
incorporated or otherwise;

Companies Act, 2013 Key implications

5. Resolution for renewal of limits for borrowing /investment/ guarantee/
security etc in accordance with provisions of section 180 and 186 of
companies act, 2013 and other matters as may be required.
6. Resolution for considering and recommending for approval by special
resolution by shareholders, all related party transactions under section 188 of
the companies act 2013.
7. Resolution for taking note of the duties of the company secretary (of the
company either in whole time employment or in whole time practice) as per
the new Act;
Maintaining records with respect of each and every meeting of the company (Board
or general meeting) becomes all the more important because, in almost all major
issues, the filing of the minutes, resolutions and agenda with the RoC has become
mandatory.
Unlike the earlier Act, the shareholders approval through special resolution for
related party transactions has become mandatory. Further, an extract of the Annual
return must form part of the Boards report annexed to the financial statements
mandatorily. In respect to deposits/loans received from a director or relative of a
director, the company has to file a return of such deposits/loans till 30 th June 2014
and must take steps to ensure that the same are repaid within 31 st March, 2015.
The Companies, to whom CSR provisions are applicable, are required to spend at
least 2% of the average net profits of the past 3 years compulsorily on CSR
activities and report thereon to be submitted to the RoC and also disclosed in the
boards report.
Filing of resolutions etc with the RoC (Section 117)
The following resolutions are required to be filed with the RoC compulsorily:
1. Special resolutions;
2. Resolutions agreed unanimously by all members;
3. Board resolutions relating to appointment of a managing director or a whole
time director;
4. Resolution for voluntary winding up of the company;
5. Board resolution for its consent to dispose off the undertaking or pay off the
borrowings u/s 180;
6. Board resolution for the following matters u/s 179
a. to make calls on shareholders in respect of money unpaid on their
shares;
b. to authorise buy-back of securities under section 68;
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c.
d.
e.
f.
g.
h.
i.
j.

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Companies Act, 2013 Key implications

issue securities, including debentures, whether in or outside India;
borrow monies;
invest the funds of the company;
grant loans or give guarantee or provide security in respect of loans;
approve financial statement and the Boards report;
diversify the business of the company;
approve amalgamation, merger or reconstruction;
take over a company or acquire a controlling or substantial stake in

another company;
k. any other matter which may be prescribed.
7. Any other resolution as may be prescribed