The powers granted to the Board of Directors of a Company by Section 179 of the Companies Act of 2013 include the following:
(1) The Board of Directors of a Company shall be entitled to exercise all such powers and to do all such acts and things as the Company is authorized to exercise and do:
However, the Board is subject to any regulations that are not inconsistent with this Act or the memorandum or articles, as well as any regulations made in accordance with them, including those made by the company’s general meeting, when exercising its authority:
In addition, the Board is prohibited from exercising any authority that is mandated to be exercised or performed by the company’s general meeting, regardless of whether it is mandated by this Act, the company’s memorandum, or its articles.
(2) Any previous Board action that would have been valid if that regulation had not been made is unaffected by any rule made by the company’s general meeting.
(3) By passing resolutions at Board meetings, the Board of Directors of a company has the authority to carry out the following duties on the company’s behalf: (a) calling shareholders to inquire about unpaid dividends on their shares;
- b) to grant Section 68-authorized buybacks of securities;
- c) to issue securities, such as debentures, both inside and outside of India;
(d) to get money loans;
- e) to put the company’s money into investments;
(f) to make loans, guarantee them, or put up collateral for them;
- g) to approve the Board’s report and financial statement;
- h) to make the company’s business more diverse;
(i) to approve a merger, reconstruction, or amalgamation;
(j) to acquire control over a company or a significant stake in another company;
- k) anything else that may be required:
However, the Board may delegate the powers listed in clauses (d) to (f) to any committee of directors, the managing director, the manager, or any other principal officer of the company—or, in the case of a branch office, the principal officer of the branch office—subject to the following conditions:
In addition, a banking company is not considered to be making loans or borrowing money within the meaning of this section if, in the normal course of its business, it accepts deposits of money from the public that are repayable on demand or otherwise and can be withdrawn by cheque, draft, order, or any other means, or if it deposits money with another banking company under the terms the Board may impose.
Explanation I: A banking company’s borrowings from other banking companies, the Reserve Bank of India, the State Bank of India, or any other banks established by or under any Act are exempt from the provisions of clause (d).
Explanation II: In the context of transactions between a company and its bankers, the “exercise by the company of the power specified in clause (d)” refers only to the arrangement made by the company with its bankers for the borrowing of money via overdraft, cash credit, or other means, and not to the actual day-to-day operation of the accounts via overdraft, cash credit, or other means by which the arrangement was made.
(4) The ability of the company’s general meeting to impose restrictions and conditions on the Board’s use of any of the powers listed in this section is unaffected by this section.