The Ministry of Corporate Affairs (MCA) scrapped the Rule restraining the presentation of approval of the annual financial statements, approval of the Board’s report etc. via video conferencing.
The Government notified the Companies (Meetings of Board and its Powers) Amendment Rules, 2021 which seeks to amend the Companies (Meetings of Board and its Powers) Rules, 2014 whereby Rule 4 of said Rules has been ommitted.
It is pertinent to mention here that Rule 4 is in respect of matters not to be dealt with in a meeting through video conferencing or other audio visual means namely the approval of the annual financial statements; the approval of the Board s report; the approval of the prospectus; the Audit Committee Meetings for consideration of accounts; and the approval of the matter relating to amalgamation, merger, demerger, acquisition, and takeover.
However the said Rule mandatesd that if there is a quorum in a meeting through the physical presence of Directors, any other director may participate in the above-restricted matters through video conferencing or other audio visual means in such meetings.
Needless to say that post-COVID-19 era has changed the whole scenario wherein most of the works including audit and finalisation of the financial statements are being undertaken online. Now with the deletion of Rule 4 the approval of the annual financial statements, Board s report; prospectus; the Audit Committee Meetings for consideration of accounts; and the approval of the matter relating to amalgamation, merger, demerger, acquisition, and takeover can take place via video conferencing or other audio visual means and there is no need to call physical meeting.
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