Section 174 of the Companies Act, 2013
Section 174 of the Companies Act, 2013 deals with the Quorum for Meetings of Board of Directors.
📘 Section 174 – Quorum for Board Meetings
This section specifies the minimum number of directors required to be present to legally conduct a Board Meeting.
✅ Key Provisions:
🔹 1. Quorum Requirement [Sub-section (1)]
The quorum for a Board meeting shall be 1/3rd of the total strength of the Board or 2 directors, whichever is higher.
Total strength = Total number of directors excluding vacancies.
🔹 2. Participation by Video Conferencing [Sub-section (1)]
Directors participating via video conferencing or other audio-visual means shall be counted for quorum.
🔹 3. Interested Directors [Sub-section (2)]
If the number of interested directors exceeds or equals 2/3rd of the total strength, then the quorum is the number of non-interested directors, not less than 2.
🔹 4. Adjournment [Sub-section (4)]
If a meeting cannot be held due to lack of quorum, it shall automatically stand adjourned to the same day next week, same time and place (unless otherwise decided).
📌 Example:
If a company has 9 directors:
1/3rd = 3, so minimum quorum = 3 directors.
If 6 directors are interested (i.e. have a conflict), only the remaining 3 non-interested directors can form the quorum (minimum 2 required).
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