Section 173 of the Companies Act, 2013
Section 173 of the Companies Act, 2013 deals with the Board Meetings — how and when they should be held by a company.
✅ Section 173 – Meetings of the Board
Key Provisions:
First Board Meeting:
Every company (except One Person Company) must hold its first Board meeting within 30 days from the date of its incorporation.
Minimum Number of Meetings:
Every company shall hold at least 4 Board meetings in a year.
The gap between two meetings should not exceed 120 days.
One Person Company (OPC), Small Company, and Startups need to hold at least 1 Board meeting in each half of the calendar year, with a minimum gap of 90 days between them.
Mode of Participation:
Directors can participate either in person or via video conferencing or other audio-visual means, as prescribed.
Notice of Meeting:
Minimum 7 days' notice must be given in writing to every director at their registered address, by:
Hand delivery,
Post, or
Electronic means (email, etc.).
Shorter Notice:
A Board meeting can be called at shorter notice to transact urgent business, provided at least one Independent Director, if any, is present at the meeting.
⚠️ Penalty for Non-Compliance:
Every officer of the company whose duty it is to give notice and who fails to do so shall be liable to a penalty of ₹25,000.
📌 Example:
If a company holds only 2 board meetings in a year (except OPC/Small Co/Startup), it violates Section 173 and may attract penalties.
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