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Section 174 of the Companies Act 2013: Quorum for Meetings of Board

SECTION-174 (Quorum for meetings of Board) under CHAPTER-XII (Meeting of Board and its Powers) of the Companies Act, 2013

(1) The quorum for a meeting of the Board of Directors of a company shall be one third of its total strength or two directors, whichever is higher, and the participation of the directors by video conferencing or by other audio visual means shall also be counted for the purposes of quorum under this sub-section.

(2) The continuing directors may act notwithstanding any vacancy in the Board; but, if and so long as their number is reduced below the quorum fixed by the Act for a meeting of the Board, the continuing directors or director may act for the purpose of increasing the number of directors to that fixed for the quorum, or of summoning a general meeting of the company and for no other purpose.


(3) Where at any time the number of interested directors exceeds or is equal to two-thirds of the total strength of the Board of Directors, the number of directors who are not interested directors and present at the meeting, being not less than two, shall be the quorum during such time.

Explanation.—For the purposes of this sub-section, “interested director” means a director within the meaning of sub-section (2) of section 184.

(4) Where a meeting of the Board could not be held for want of quorum, then, unless the articles of the company otherwise provide, the meeting shall automatically stand adjourned to the same day at the same time and place in the next week or if that day is a national holiday, till the next succeeding day, which is not a national holiday, at the same time and place.

Explanation.—For the purposes of this section,—
(i) any fraction of a number shall be rounded off as one;
(ii) “total strength” shall not include directors whose places are vacant.





Extra Notes for Readers

(1) The Companies Act, 2013 received the assent of the President on the 29th August, 2013 (Published in the Gazette of India, Extraordinary, Part II - Section 1 by Ministry of Law and Justice, Legislative Department on 30th August, 2013) - link


(2) Section 174 of the Companies Act 2013 was notified by MCA Notification S.O. 902(E) dated 26th March 2014 (w.e.f. 1st April, 2014) - link

(3) Further, refer the Companies (Meeting of Board and its PowersRules, 2014 (w.e.f. 1st April, 2014) - link
[Also check amendments, if any, to the Companies (Meeting of Board and its Powers) Rules, 2014]

(4) Specified IFSC Private Company - MCA Notification G.S.R. 09(E) dated 4th January, 2017 - link 

Serial
Number
Provisions of the Companies Act, 2013 (18 of 2013)
Exceptions/Modifications/Adaptations
32.
Sub-section (3) of section 174
Shall apply with the exception that interested director may participate in such meeting provided the disclosure of his interest is made by the concerned director either prior or at the meeting.

(5) Specified IFSC Public Company - MCA Notification G.S.R. 08(E) dated 4th January, 2017 - link

Serial
Number
Provisions of the Companies Act, 2013 (18 of 2013)
Exceptions/Modifications/Adaptations
47.
Sub-section (3) of section 174
Shall apply with the exception that interested director may participate in such meeting provided the disclosure of his interest is made by the concerned director either prior or at the meeting.

(6) Section 8 Companies - MCA Notification G.S.R. 466(E) dated 5th June, 2015 - link

Serial
Number
Provisions of the Act
Exceptions, Modifications and Adaptations
15.
Sub-section (1) of section 174.
In sub-section (1),---
(a) for the words “one-third of its total strength or two directors, whichever is higher”, the words “either eight members or twenty five per cent. of its total strength whichever is less” shall be substituted;
(b) the following proviso shall be inserted, namely:-
“Provided that the quorum shall not be less than two members”.








This page was last updated on 30th March, 2017.

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