Companies Act Section 117 — Resolutions and agreements to be filed
CHAPTER VII MANAGEMENT AND ADMINISTRATION
Commercial / Corporate
Summary
Sub-section (1) requires a company to file a copy of every resolution or agreement that falls under the matters listed in sub-section (3) with the Registrar of Companies. This filing must happen within thirty days of the resolution being passed or the agreement being made, and must be done in the manner and with the fees that are prescribed by the rules. If an explanatory statement under section 102 was annexed to the notice calling the meeting where the resolution was proposed, that statement must also be filed along with the resolution. Additionally, the proviso states that if a resolution has the effect of changing the company's articles, or if an agreement is of the type listed in sub-section (3), then a copy of that resolution or agreement must be included in or attached to every copy of the articles that the company issues after the resolution is passed or the agreement is made.
Sub-section (2) sets out the penalties for failing to file a resolution or agreement within the time period specified in sub-section (1). If a company does not file it before that period expires, the company is liable to a penalty of ten thousand rupees. If the failure continues after the first day, there is an additional penalty of one hundred rupees for each day the failure continues, but this additional penalty is capped at a maximum of two lakh rupees. Every officer of the company who is in default, including the liquidator of the company if there is one, is also liable to a penalty of ten thousand rupees, and if the failure continues, a further penalty of one hundred rupees per day after the first, subject to a maximum of fifty thousand rupees.
Sub-section (3) lists the types of resolutions and agreements to which this section applies. Under clause (a), it applies to special resolutions. Under clause (b), it applies to resolutions that have been agreed to by all the members of a company, but which would not have been effective for their purpose unless they had been passed as special resolutions if they had not been agreed to by everyone. Under clause (c), it applies to any resolution of the Board of Directors or any agreement executed by the company that relates to the appointment, re-appointment, or renewal of the appointment, or the variation of the terms of appointment, of a managing director. Under clause (d), it applies to resolutions or agreements that have been agreed to by any class of members, but which would not have been effective for their purpose unless they had been passed by a specified majority or in some particular manner, as well as all resolutions or agreements that effectively bind such a class of members even though not all of those members agreed to them. Under clause (f), it applies to resolutions requiring a company to be wound up voluntarily, passed in pursuance of section 59 of the Insolvency and Bankruptcy Code, 2016. Under clause (g), it applies to resolutions passed in pursuance of sub-section (3) of section 179. The first proviso to clause (g) states that no person is entitled under section 399 to inspect or obtain copies of such resolutions. The second proviso to clause (g) states that this restriction does not apply to a resolution passed to grant loans, or give a guarantee or provide security in respect of loans, under clause (f) of sub-section (3) of section 179, when done in the ordinary course of business by a banking company, by any class of non-banking financial company registered under Chapter IIIB of the Reserve Bank of India Act, 1934 as may be prescribed in consultation with the Reserve Bank of India, or by any class of housing finance company registered under the National Housing Bank Act, 1987 as may be prescribed in consultation with the National Housing Bank. Under clause (h), it applies to any other resolution or agreement as may be prescribed by the rules and placed in the public domain.
Official Text
(1) A copy of every resolution or any agreement, in respect of matters specified in sub-section (3) together with the explanatory statement under section 102, if any, annexed to the notice calling the meeting in which the resolution is proposed, shall be filed with the Registrar within thirty days of the passing or making thereof in such manner and with such fees as may be prescribed 1***:
Provided that the copy of every resolution which has the effect of altering the articles and the copy of every agreement referred to in sub-section (3) shall be embodied in or annexed to every copy of the articles issued after passing of the resolution or making of the agreement. 2[
(2) If any company fails to file the resolution or the agreement under sub-section (1) before the expiry of the period specified therein, such company shall be liable to a penalty of ten thousand rupees and in case of continuing failure, with a further penalty of one hundred rupees for each day after the first during which such failure continues, subject to a maximum of two lakh rupees and every officer of the company who is in default including liquidator of the company, if any, shall be liable to a penalty of ten thousand rupees and in case of continuing failure, with a further penalty of one hundred rupees for each day after the first during which such failure continues, subject to a maximum of fifty thousand rupees.]
(3) The provisions of this section shall apply to—
(a) special resolutions;
(b) resolutions which have been agreed to by all the members of a company, but which, if not so agreed to, would not have been effective for their purpose unless they had been passed as special resolutions;
(c) any resolution of the Board of Directors of a company or agreement executed by a company, relating to the appointment, re-appointment or renewal of the appointment, or variation of the terms of appointment, of a managing director;
(d) resolutions or agreements which have been agreed to by any class of members but which, if not so agreed to, would not have been effective for their purpose unless they had been passed by a specified majority or otherwise in some particular manner; and all resolutions or agreements which effectively bind such class of members though not agreed to by all those members; 1* * * * *
(f) resolutions requiring a company to be wound up voluntarily passed in pursuance of 2[section 59 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016)];
(g) resolutions passed in pursuance of sub-section (3) of section 179:3*** 4[Provided that no person shall be entitled under section 399 to inspect or obtain copies of such resolutions; 5***] 6[Provided further that nothing contained in this clause shall apply in respect of a resolution passed to grant loans, or give guarantee or provide security in respect of loans under clause (f) of sub-section (3) of section 179 in the ordinary course of its business by—
(a) a banking company;
(b) any class of non-banking financial company registered under Chapter IIIB of the Reserve Bank of India Act, 1934 (2 of 1934), as may be prescribed in consultation with the Reserve Bank of India;
(c) any class of housing finance company registered under the National Housing Bank Act, 1987 (53 of 1987), as may be prescribed in consultation with the National Housing Bank; and]
(h) any other resolution or agreement as may be prescribed and placed in the public domain.