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Powers of the Board – Companies Act, 2013 Vs Companies Act, 1956

S. No Particulars Companies Act, 2013 Companies Act, 1956 Changes
1 Applicability Section – 179 read with Rule 8 of the Companies(Meetings of the Board and its Powers) Rules, 2014 Section – 291 & 292 --
2 Powers of Board The Board of Directors 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 shares;

(b) to authorise buy-back of securities under section 68;

(c) to issue securities, including debentures, whether in or outside India;

(d) to borrow monies;

(e) to invest the funds of the company;

(f) to grant loans or give guarantee or provide security in respect of loans;

(g) to approve financial statement 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 **.

 

** Rule 8 of the Companies (Meetings of the Board and its Power) Rules, 2014.

 

1.To make political contributions;

2.To appoint or remove key managerial personnel (KMP);

3.To appoint internal auditors and secretarial auditor;

The Board of directors shall exercise the following powers on behalf of the company, and it shall do so only by means of resolutions passed at meetings of the Board : -

(a) the power to make calls on shareholders in respect of money unpaid on their shares ;

(aa) the power to authorise the buy-back referred to in the first proviso to clause (b) of sub-section (2) of section 77A;

(b) the power to issue debentures;

(c) the power to borrow moneys  otherwise than on debentures;

(d) the power to invest the funds of the company; and

(e) the power to make loans

 
Following powers have been introduced as per Companies Act, 2013 to be exercised by the Board only at their meeting: -

-  To issue securities, including debentures, whether in India or outside;

-  To grant loans or give    guarantee or provide security in respect of loans;

-  To approve financial statement and the Board’s report;

-  To diversify the business of  the Company;

-  To approve amalgamation,   merger or reconstruction;

- To take over a Company or acquire a controlling or substantial stake in    another Company; and

- Such other matters relating to political contributions, appoint or remove key managerial personnel and appointment of internal & secretarial Auditors.

3 Delegation of Powers The Board may, by a resolution passed at a meeting, delegate to any committee of directors, the managing director, the manager or any other principal officer of the company or in the case of a branch office 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. The Board may, by a resolution passed at a meeting, delegate to any committee of directors, the managing director, the manager or any other principal officer of the company or in the case of a branch office of the company, a principal officer of the branch office, the powers specified in clauses (c), (d) and (e) to the extent specified in sub-sections (2), (3) and (4) respectively, on such conditions as the Board may prescribe.Every resolution delegating the power referred in clauses (c), (d) & (e) mentioned above shall specify the total amount upto which the borrowing/investment and its nature /loans including the maximum amount of loans which may be made for each such purpose in individual cases. Now, while delegating the power to any committee or any specified person, it is not necessary to specify the amount up to which that power can be exercised.
4 Filing of Resolution passed As per Section 117(3) (g) read with Rule 24 of the Companies (Management and Administration) Rules, 2014 Rules, 2014-
  • Resolutions passed in pursuance of subsection (3) of section 179 is to be filed together with explanatory statement u/s 102, if any with the Registrar in Form-MGT-14 within 30 days of its passing along with the Fee.**
** In case of private companies section 117(3)(g) shall not apply – Notification dated 5-6-2015.
Filing of resolution passed as per prescribed section was not required. Resolution passed in pursuance of subsection (3) of section 179 read with rules is to be filed in Form-MGT-14 within 30 days with ROC for Public Companies.
 

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