Amendment in the companies (Meetings and Board of powers) rules vide Notification dated 14.08.2014 by Companies (Meetings of Board and its Powers) Second Amendment Rules, 2014.
| List of amendments | Date of issue | Changes/Additions |
First amendment
(Section 177 and Section 178 have been covered)
| June 12, 2014 |
In rule 6- Committees of the Board
Applicability- Listed and Public companies
Insertion-
“Provided that public companies which were not required to constitute Audit Committee under section 292A of the Companies Act, 1956 (1 of 1956) shall constitute their Audit Committee within one year from the commencement of these rules orappointment of independent directors by them, whichever is earlier :
Provided further that public companies covered under this rule shall constitute their Nomination and Remuneration Committee within one year from the commencement of these rules or appointment of independent directors by them, whichever is earlier.”
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| Second amendment | August 14, 2014 | A. In rule 3 (6)- Meetings of Board through videoconferencing or other audio visual means
Applicability- all companies
Change-
With respect to every meeting conducted through video conferencing or other audio visual means authorised under these rules, the scheduled venue of the meeting as set forth in the notice convening the meeting, which shall be in India, shall be deemed to be the place of the said meeting and all recordings of the proceedings at the meeting shall be deemed to be made at such place
B. In rule 4 (1)- Matters not to be dealt with in a meeting through video conferencing or other audio visual means
Change-“ (1) The” has been replaced by “The”
C. In rule 4 (1) (iv)- “the Audit Committee Meetings for consideration of accounts” has been replaced by “the Audit Committee Meetings for consideration of financial statement, if any , to be approved by the Board under sub-section (1) of section 134 of the Act”
D. In rule 15 (3)-Contract or arrangement with a related party
Applicability- all companies
Change- please refer below table
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In rule 15 (3) -Contract or arrangement with a related party under section 188 of the Act
Applicability- all companies
- Change in the Limits
| S. No. | Current | Now, post August 14, 2014 |
| (a) | Sale, purchase or supply of any goods or materials directly or through appointment of agents exceeding 25% of the annualturnover | Sale, purchase or supply of any goods or materials directly or through appointment of agents exceeding 10% of the turnover or 100 crore, whichever is lower |
| (b) | Selling or otherwise disposing of, or buying, property of any kind directly or through appointment of agents exceeding 10% of net worth | Selling or otherwise disposing of, or buying property of any kind directly or through appointment of agents exceeding 10% of net worth or 100 crore, whichever is lower |
| (c) | Leasing of property of any kind exceeding 10% of the net worth or exceeding 10% of turnover | Leasing of property of any kind exceeding 10% of the net worth or exceeding 10% of turnover or 100 crore, whichever is lower |
| (d) | Availing or rendering of any services directly or through appointment of agents exceeding 10% of the net worth | Availing or rendering of any services directly or through appointment of agents exceeding 10% of turnover, or 50 crores, whichever is lower |
It has now clarified that the limits specified above (a) to (d) shall apply for transaction (s) to be entered into either individually or taken together with the previous transactions during a year.
- The following has been removed from the rule
“(i) a company having a paid-up share capital of ten crore rupees or more shall not enter into a contract or arrangement with any related party; or”
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