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Old standards, new amendments. Secretarial Standard - SS-1 & SS-2

After due deliberations, the Institute of Company Secretaries of India (ICSI) has amended Secretarial Standard (SS-1) & Secretarial Standard 2 (SS-2), and they are to come into effect from 1 st October 2017.

This got necessitated because of a slew of amendments and clarifications which further prompted a need to bring the standards in alignment with provisions of the Act and the recent changes thereon.

Here’s a look at some of the changes brought in SS1 & SS2

SS-1

  1. Section 8 companies and OPC have been exempt from the applicability of the Standards
  2. Only the committee of the board constituted by the Act is considered as committee for SS
  3. As per revised SS-1, an adjourned Board meeting as well as adjourned Board meeting can be held on a National Holiday.
  4. Speed post and registered post are acceptable modes of sending Notices, Agenda or notes. Sending by courier has been restricted.
  5. Companies have to mandatorily maintain copy of proof of sending Notice for at least 3 years from the meeting date.
  6. Any additional or urgent matter can be taken up with the permission of the Chairman and majority of directors present in the meeting. Consent of independent director is not mandatory.
  7. Strict requirement of holding a Board meeting every calendar quarter has been done away with.  The Company needs to hold Board meeting at least four times in a calendar year with a maximum of 120 days interval between two consecutive meetings
  8. A director, even after his retirement, can inspect the attendance register for the period of his directorship.
  9. The request for leave of absence of a director can be communicated to any person authorized by the Board to issue Notice of meeting
  10. As per the revised standards, a director in case of a private company, can participate in such item after disclosure of interest. However, he will not participate in a related party transaction.
  11. Company has to maintain proof of sending draft minutes for at least 3 years.
  12. Any alteration in the minutes can be done by express approval of the board in the subsequent meeting and this shall be noted in the minutes of such subsequent meeting.
  13. The Directors report has to mention a statement that the company is in compliance with the secretarial standards

SS-2

  1. Section 8 companies and OPC have been exempt from the applicability of the Standards
  2. The Notice for General meeting shall be simultaneously hosted in website till conclusion of the meeting.
  3. AGM Notice should also specify the serial number of the meeting
  4. For ordinary business, Resolutions are not required to be stated in Notice.
  5. In case of resolutions where remote e-voting is demanded or where a poll is demanded, the need for proposing and seconding the resolution has been done away with.
  6. Private companies are not required to give notice and accompanying documents 21 days in advance of the meeting, if Articles provide otherwise.
  7. Scrutiniser will have to submit his report to the Chairman or authorised person within 3 days of the meeting. This, however, will not impact listed companies.
  8. Company can maintain minutes in physical or electronic form. No need of time stamp on electronic minutes. And the minute’s book can only be kept at the registered office of the Company.

The revisions are aimed to improve the ease of doing business and has factored the suggestions of various stakeholders.

Such types of revisions in the business market help the business to plan its operation in market in the best way. Without proper understanding of law and order, the business might not run through a smooth process and which can also become a hindrance for the business in its long run. Hence, to avoid disturbance in the business process and function, it becomes necessary for the businesses to closely study the market structure, the law of the land and the result that would reflect in terms of business returns. In such cases, business entities are advised to get help of expert individuals or a team of experts who can guide and update the organisation through the best way. Consultant service providers such as IBS India, helps businesses in India to get detailed study of the market statistics. Being one of the major corporate consultant companies in India, IBS India also supports organisations in business structuring and incorporation of the company. IBS India is been renowned for providing the best legal and financial consulting to companies in India, helping them to establish their roots in the business market.

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