Companies Act Section 175 — Passing of resolution by circulation

CHAPTER XII MEETINGS OF BOARD AND ITS POWERS

Commercial / Corporate

Summary

Sub-section (1) states that a resolution will not be considered duly passed by the Board or a committee through circulation unless it has been sent in draft form, along with any necessary papers, to all directors or committee members at their registered addresses in India. This can be done by hand delivery, post, courier, or through electronic means as prescribed. The resolution must then be approved by a majority of the directors or members who are entitled to vote on it.

The proviso to sub-section (1) adds that if at least one-third of the total number of directors of the company at that time require that a resolution under circulation be decided at a meeting, the chairperson must put the resolution to be decided at a meeting of the Board instead.

Sub-section (2) states that a resolution passed under sub-section (1) must be noted at a subsequent meeting of the Board or the committee, as the case may be, and made part of the minutes of that meeting.

Official Text

(1) No resolution shall be deemed to have been duly passed by the Board or by a committee thereof by circulation, unless the resolution has been circulated in draft, together with the necessary papers, if any, to all the directors, or members of the committee, as the case may be, at their addresses registered with the company in India by hand delivery or by post or by courier, or through such electronic means as may be prescribed and has been approved by a majority of the directors or members, who are entitled to vote on the resolution:

Provided that, where not less than one-third of the total number of directors of the company for the time being require that any resolution under circulation must be decided at a meeting, the chairperson shall put the resolution to be decided at a meeting of the Board.

(2) A resolution under sub-section (1) shall be noted at a subsequent meeting of the Board or the committee thereof, as the case may be, and made part of the minutes of such meeting.