DRAFTING OF BOARD RESOLUTION AND SPECIAL RESOLUTION

A company is required to draft various board resolutions and special resolutions for carrying on the day-to-day business activities. There are two types of resolutions; ordinary and special resolution. An ordinary resolution is one which is passed by simple majority of votes whereas special resolution requires approval of atleast 75% of the members of the company.

Some important board resolutions

  • Alteration of MOA of company for increase in share capital
  • Appointment of Managing Director, Whole Time Director, Manager
  • Approval of remuneration to directors
  • Approval of financial statements and boards report
  • Approval to Borrow monies from banks and FI or directors
  • Approval of transfer of shares
  • Appoint authorized representative for various matters like entering in to lease agreement, appearing in courts, buy or sell property, etc.
  • Appointment of auditors of the company
  • Allotment of shares

Some instances where Special Resolution is required:

  • Approval to shift the registered office outside the local limits of any city
  • Alteration of MOA and AOA of the company
  • Issuance of Sweat Equity shares of the company
  • Authorise the company to purchase its own securities.
  • Issue of shares of company
  • Borrow funds exceeding paid up share capital and free reserves
  • Approval of change of name of the company
  • Approval of object clause of the company
  • Approval to pay directors remuneration exceeding specified limits.
Drafting of resolutions is very crucial part for complying with the provisions of the Companies Act, 2013. In many of the cases there are specific list of contents that are required to be put in the resolution.

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