Minutes of Meeting of a Company and the Maintenance of Minutes of Meeting

Minutes of a meeting are official written records that document the discussions, decisions, and resolutions made during company meetings such as board meetings, annual general meetings (AGMs), extraordinary general meetings (EGMs), and committee meetings. These minutes are vital for legal compliance under the Companies Act, 2013, and follow the Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI). They ensure transparency, provide evidence of proceedings, and help maintain internal governance. Proper maintenance involves drafting accurate records, obtaining approval, signing by the chairman or authorized person, and preserving the minutes in bound or electronic form.

In this blog, we will understand the meaning of minutes of the meeting, its importance, legal provisions governing it, the procedure for drafting the minutes, and how to maintain them.

What are Minutes of Meeting?

Minutes of a meeting are formal written records that provide a detailed account of the discussions, decisions, and resolutions passed during official meetings of a company. These meetings may include board meetings, annual general meetings (AGMs), extraordinary general meetings (EGMs), and committee meetings. Proper maintenance of minutes is crucial for legal compliance and serves as evidence of decisions made during these meetings. In India, maintaining minutes is governed by the Companies Act, 2013, and the Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).

Importance of Minutes of Meeting

1. Legal Compliance: Minutes act as a legal record as mandated by the Companies Act, 2013, which proves that the meeting was held as per statutory requirements.
2. Evidence of Proceedings: Minutes serve as legal evidence in case of disputes or compliance verification.
3. Transparency: They ensure that all decisions are documented and made accessible to stakeholders.
4. Official Record: It maintains a detailed account of discussions, resolutions, and decisions, providing historical data for future reference.
5. Internal Communication: It acts as a communication tool for members who could not attend the meeting, keeping them updated on the proceedings
6. Reference and Record-Keeping: Minutes serve as a point of reference for future meetings and audits.
7. Internal Governance: Maintaining minutes fosters internal transparency and accountability.

Legal Provisions Governing Minutes of Meeting

The Companies Act, 2013, along with the Secretarial Standards issued by ICSI, prescribes the rules for maintaining and recording minutes of meetings:

1. Section 118 of the Companies Act, 2013 mandates the preparation and signing of minutes of every meeting.
2. Secretarial Standard-1 (SS-1) on Board Meetings and Secretarial Standard-2 (SS-2) on General Meetings: These standards provide guidelines for recording minutes.
3. Time Limit: Minutes must be signed and finalized within 30 days of the meeting.
4. Authentication: Minutes must be signed by the chairman or any authorized person.

Components of Minutes of Meeting

1. Basic Details: This includes the meeting type, date, time, venue, and a list of attendees to establish the context.
2. Agenda Items: Lists the specific topics discussed during the meeting in the order they were addressed.
3. Key Discussions: Summarizes important deliberations, including viewpoints shared and issues raised.
4. Resolutions Passed: Records the formal decisions made, with clear wording, and indicates whether they were passed unanimously or by a majority.
5. Voting Results: Documents the outcome of any votes, including votes in favor, against, and abstentions.
6. Dissent Notes: It includes any disagreements or objections expressed by members during the meeting.
7. Signature: Authenticated by the chairman or authorized signatory to validate the accuracy of the minutes.

Procedure for Drafting and Recording Minutes

• Drafting: Prepare the minutes in a clear, concise, and accurate manner, reflecting the key discussions and decisions taken during the meeting.
• Approval: Circulate the draft minutes to the members for their review and feedback, ensuring accuracy and completeness.
• Signing: Once verified, the finalized minutes are signed by the chairman or an authorized person to confirm their accuracy.
• Entry in Minutes Book: The signed minutes are then recorded in the official minutes book as a permanent record.

Maintenance of Minutes of Meeting

1. Format and Form:

• Separate Minute Books: Companies are required to maintain distinct minute books for each type of meeting, including Board meetings, General meetings, and Committee meetings.
• Physical or Electronic Form: Minutes can be maintained in either physical form or in electronic form with a timestamp. However, a company must consistently use one form for all minutes and cannot alternate between physical and electronic forms.
• Consecutive Numbering: Pages of the minute books should be consecutively numbered. If any page is left blank, it must be scored out and signed with initials by the Chairman, who signs the minutes.

• Custodian: The Company Secretary is primarily responsible for the maintenance and custody of the minute books. In the absence of a Company Secretary, such a person is authorised by the Board of Directors.
• Location: Minute books of General Meetings must be kept at the company’s registered office. Minute books of Board and Committee meetings can be kept at the registered office or any other place approved by the Board of Directors.

4. Inspection Rights:

• Members’ Rights: As per Section 119 of the Companies Act, 2013, the books containing the minutes of the proceedings of any General Meeting shall be kept at the registered office of the company and shall be open, during business hours, to the inspection by any member without charge. Members are entitled to be furnished, within seven working days after making a request, with a copy of any minutes, upon payment of prescribed fees.
• Board and Committee Meetings: Inspection rights for minutes of Board and Committee meetings are generally restricted to Directors and authorized personnel.

5. Signing and Entry:

• Timeframe: Minutes must be entered in the minute books within 30 days of the conclusion of the meeting.
• Authentication: Each page of the minutes should be signed with initials, and the last page should be signed and dated by the Chairman of the meeting or, in the event of their inability, by a director authorized by the Board.

Conclusion

Minutes of a meeting are crucial records that capture the discussions and decisions made during formal company meetings. Maintaining these records in accordance with legal requirements helps ensure compliance and promotes transparency within the organization. Adopting best practices for drafting, approving, and preserving minutes not only safeguards the company from legal issues but also strengthens internal governance and accountability.