Extension of Due Date for GST Audit F.Y.2018-19 & Tax Audit Due Date for A.Y. 2020-21

Income tax return for FY 2019-20 (no tax audit) - 

*31 December 2020*

Income tax return for FY 2019-20 (TP, tax audit and partners of tax audit firms) - 

*31 January 2020*

Various audit reports (including tax audit, transfer pricing) - 

*31 December 2020*

Income tax return for FY 2018-19 - 

*30 November 2020*

GSTR9/9C for FY FY 2018-19 - 

*31 December 2020*

Clarification of Issues Relating to Application of Rule 36(4) of CGST Rules 2017

In view of measures taken to contain the spread of COVID-19 pandemic, vide notification No. 30/2020-CT, dated 03.04.2020, it had been prescribed by the department that the condition made under Rule 36(4) of  CGST Rules shall apply cumulatively for the tax period February, March, April, May, June, July and August, 2020 and that the return in FORM GSTR-3B for the tax period September, 2020 shall be furnished with the cumulative adjustment of input tax credit for the said months.

The CBIC has issued a Circular No. 142/12/2020-GST dated 9th October, 2020 providing clarification relating to application of sub-rule (4) of rule 36 of the CGST Rules, 2017 for the months of February, 2020 to August, 2020. The main points of the circular are given below:

1. To reconcile the ITC availed in their FORM GSTR-3Bs for the period February, 2020 to August, 2020 with the details of invoices uploaded by their suppliers of the said months, till the due date of furnishing FORM GSTR-1 for the month of September, 2020.

2. The cumulative amount of ITC availed for the said months in FORM GSTR-3B should not exceed 110% of the cumulative value of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers in GSTR 1, till the due date of furnishing GSTR-1 for the month of September, 2020 that is 11.10.2020. It may be noted that availability of 110% of the cumulative value of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers in GSTR 1 does not mean that the total credit can exceed the tax amount as reflected in the total invoices for the supplies received by the taxpayer i.e. the maximum credit available in terms of provisions of section 16 of the CGST Act.

3. The excess ITC availed arising out of reconciliation during this period, if any, shall be required to be reversed in Table 4(B)(2) of FORM GSTR-3B, for the month of September, 2020.

4. Failure to reverse such excess availed ITC on account of cumulative application of sub-rule (4) of rule 36 of the CGST Rules would be treated as availment of ineligible ITC during the month of September, 2020. 

5. An illustration explaining the manner of cumulative reconciliation of ITC for the period February, 2020 to August, 2020 are given below in tabulated form.

 

Tax Period	ITC availed by the taxpayer (recipient) in GSTR-3B of the respective months	Eligible ITC as per the provisions of Chapter V of the CGST Act.	Invoices on which ITC is eligible and uploaded by the suppliers till due date of FORM GSTR-1 for the tax period of September, 2020	Effect of cumulative application of rule 36(4) on availability of ITC.
February 2020	300	300	370	Maximum eligible ITC in terms of rule 36 (4) is 2450 + [10% of 2450] =2695. Taxpayer had availed ITC of 2750. Therefore, ITC of 55 [2750-2695] would be required to be reversed as mentioned in point 4 above.
March 2020	400	400	380
April 2020	500	500	450
May 2020	350	350	320
June 2020	450	450	400
July 2020	550	550	480
August 2020	200	200	150
Total	2750	2750	2450
ITC Reversal required to the extent of 55
September 2020	385	500	350	10% Rule shall apply independently for September, 2020
In the FORM GSTR-3B for the month of September, 2020, the tax payer shall avail ITC of 385 under Table 4(A) and would reverse ITC of 55 under Table 4(B)(2).

Compliance Calendar Financial Year Wise affected due to COVID-19 for July 2020

🔴 *FY 2018-19 *

📙 *INCOME TAX*

✔️31st July 2020- For assesse who has not filled their return or audit for FY 2018-19 last date of filling return

🔴 *FY 2019-20 *

📙 *INCOME TAX*

✔️31st July 2020- The date for making various investment/payment for claiming deduction under Section 80C (LIC, PPF, NSC etc.), 80D (Mediclaim), 80G (Donations), etc.

🔴 *FY 2020-21 *

📙 *INCOME TAX*

✔️07th July 2020- TDS deducted /TCS collected for the month of June 2020

✔15th July 2020- TDS return of government department for fourth quarter ending on 31.03.2020

✔15th July 2020- TCS return deposit fir fourth quarter ending on 31.03.2020

✔️31st July 2020- TDS return in form 24Q/26Q for fourth quarter ending on 31.03.2020 

✔31st July 2020- TDS return for quarter 1 ending on 30.06.2020

✔️15th August 2020- Issue of form 16/16A for the fourth quarter ending 31.03.2020

✔️31st March 2021- Date for linking of Aadhaar with PAN

📙 *GST*

*Taxpayer having aggregate turnover > Rs. 5cr in preceding FY*

✔️20th July 2020- Due date of filling GSTR-3B for the month of June 2020 (No Extension)

✔️05th August 2020- Due date of filling GSTR-1 for the month of June 2020 

*Taxpayer having aggregate turnover upto Rs. 5cr in preceding FY*

*-GSTR-3B*

✔️03rd July 2020- Due date of filling GSTR-3B for the month of March 2020

✔️06th July 2020- Due date of filling GSTR-3B for the month of April 2020

✔️12th Sept 2020- Due date of filling GSTR-3B for the month of May 2020

✔️23th Sept 2020-Due date of filling GSTR-3B for the month of June 2020

*-GSTR-1 (Monthly)*

✔️10th July 2020- Due date of filling GSTR-1 for the month of March 2020

✔️24th July 2020- Due date of filling GSTR-1 for the month of April 2020

✔️28th July 2020- Due date of filling GSTR-1 for the month of May 2020

✔️05th August 2020- Due date of filling GSTR-1 for the month of June 2020

*-GSTR-1 (Quarterly)*

✔️17th July 2020- Due date for filling GSTR-1 for the Quarter Jan-March-2020

✔️03rd August 2020- Due date for filling GSTR-1 for the Quarter Apr-June 2020

*-Composition Dealer*

✔️08th July 2020- Due date for filling CMP-08 for the Quarter Jan-March-2020

✔️15th July 2020- Due date for filling GSTR-4 for the Quarter Jan-March-2020

*-ANNUAL RETURN /AUDIT REPORT*

✔️30th Sept 2020- GSTR-9 Annual return for FY 2018-19.

✔️30th Sept 2020- GSTR-9C Audit Report for FY 2018-19.

📙 *ESI/PF*

✔️15th July 2020- Due date of filling ESIC return of contribution for the period October-19 to March 2020.

✔️15th July 2020- Due date for payment of Provident Fund, ESI contribution for employers who have paid wages to their employees for June 2020.

📙 *PROFESSIONAL TAX*

✔31st  July 2020- Due date for exemption of  late fee payable under amnesty scheme for  in respect of monthly or annual professional tax returns pertaining to any periods up to March 2020 and monthly period of April 2020.

✔31st July 2020- Due date for payment of PT for the month of June where tax liability is more than Rs.50,000/-

*NOTE:*

1. Vivaad Se Vishwas Scheme extended to 31.12.2020 (without additional 10% of tax)

2. MCA - moratorium from 01.04.20 to 30.09.20 - there shall be no additional fees for late filings.

3. Revised CARO to get applicable from FY 20-21 instead of FY 19-20

4. For newly incorporated companies - Commencement of business is to be filed within 6 months, which is now extended for another 6 months.

5. DIN holders tagged as ‘Deactivated’ have an extended time of up to 30th September 2020 for filing DIR-3KYC/DIR-3 KYC-Web, without fees of Rs 5,000. Companies marked as “ACTIVE non-compliant” have got extended time of up to 30th September 2020 to file eForm ACTIVE without fees of Rs 10,000.

Clarification on GST liability on Director of Company

FAQ’s on GST liability on Director of Company

1)      Who are Directors of a company?

The directors are the persons elected by the shareholders to direct, conduct, manage or supervise the affairs of the company. According to Sec. 2 (13) of the Companies Act, “Director includes any person occupying the position of director by whatever name called.”

2)      What do you mean by an independent director?

Section 2(47) of the Companies Act states that an ‘independent director’ means an independent director referred to in Section 149(6). Section 149(6) provides with a descriptive list of qualifications of an independent director.

3)      Can an employee be appointed as an independent director of the company?

Independent director cannot be an employee, proprietor or a partner of the said company, in any of the 3 financial years immediately proceeding the financial year in which he is proposed to be appointed in the said company.

4)      What do you mean by a whole time director?

“Whole-time Director” includes a director in the whole-time employment of the company. The definition of ‘whole-time director’ is an inclusive definition, so he may not be an employee of the company too.

5)      What do you mean by a managing director?

The Board of Directors generally appoints one of its members to manage the affairs of the company as a whole time officer and calls him the Managing Director. The Managing Director occupies a position of dual authority and responsibility. As a director, he attends the Board meetings and, as a manager, he performs the managerial functions.

6)      What is an important test to determine whether GST is leviable on services provided by directors?

The following criteria needs to be fulfilled in order to not constitute as a supply under GST:-‘

a.       Employer-employee relationship (master servant relationship)

b.      TDS is deducted u/s 192

c.       It should be a contract of service and not a contract for service

7)      How are services provided by a whole time director to a body corporate covered under GST?

Here, it is essential to note whether the services provided by the whole time director are in accordance of a contract of employment or not.

a)      If the whole time director is working according to a contract of employment, services provided do not constitute as a supply under GST. Hence, not taxable.

b)      If the whole time director is not working according to a contract of employment, services provided constitute as a supply under GST. Consideration received by the director is taxable on RCM basis in the hands of the company

8)      How are services provided by an independent director to a body corporate covered under GST?

Services provided by an independent director constitute as a supply under GST as there is no employer-employee relationship. Consideration received by the director is taxable on RCM basis in the hands of the company.

9)      Mr. A is a director employed by XYZ Pvt Ltd under the terms of an employment contract. Mr. A received salary of Rs 10 lakhs during the year. Is this consideration taxable under GST?

Services provided by Mr. A are in terms of the employment contract. There is employer-employee relationship in this case. These services will not be considered as supply under GST. Hence, not taxable.

10)   How are services provided by a managing director to a body corporate covered under GST?

It is essential to find out whether the services provided by the managing director are in accordance of a contract of employment or not.

a)      If the managing director is working according to a contract of employment, services provided do not constitute as a supply under GST. Hence, not taxable.

b)      If the managing director is not working according to a contract of employment, services provided constitute as a supply under GST. Consideration received by the director is taxable on RCM basis in the hands of the company.

11)   What is the GST payable on services provided by directors when they constitute as a supply under GST?

GST Rate payable by receiver (company or body corporate) is 18%.

12)   Who can avail the benefit of Input Tax Credit (ITC) on services provided by a director to a company or body corporate?

a)      The question of availing ITC does not arise on cases which do not constitute as a supply under GST (employer-employee relationships).

b)      The recipient (company or body corporate in this case) can avail ITC of GST amount that is paid under reverse charge on receipt of services (cases where employer-employee relationship does not exist)

13)    What is the time of supply for supply of director’s services when they are covered under RCM?

Time of Supply shall be earliest of:-

a)      the date of payment as entered in the books of account of the recipient or the date on which the payment is debited in his bank account, whichever is earlier

b)      61st date from the date of issue of invoice

If it is not possible to compute time of supply using above method, the time of supply shall be the date of entry in the books of account of the recipient of supply.

14)   Mr. P is a director of ABC Pvt Ltd. On payment of consideration to Mr. P, ABC Pvt Ltd deducts TDS u/s 192 of Income Tax Act (TDS on salary). IS GST chargeable on this amount?

Services provided by Mr. P are in terms of the employment contract. There is employer-employee relationship, which is proved by the fact that TDS is deducted u/s 192. These services will not be considered as supply under GST. Hence, not taxable.

15)   Mr. Q is a director of ABC Pvt Ltd. On payment of consideration to Mr. Q, ABC Pvt Ltd deducts TDS u/s 194J of Income Tax Act (TDS on professional fees). Is GST chargeable on this amount?

Services provided by Mr. Q constitute as a supply under GST as there is not employer-employee relationship, which is proved by the fact that TDS is deducted u/s 194J. Consideration received by the director is taxable on RCM basis in the hands of the company.

GST council clears proposal of Phased reduction in late fees for not furnishing GSTR-3B for tax periods during July, 2017 - 31 Jan, 2020, provided THE PAYMENT & FILING OF RETURNS IS DONE BETWEEN 01.07.2020 to 30.09.2020

Phase 1:   Those with Nil tax liability to be charged NO LATE FEES

PHASE 2: Those with tax liability to be charges Rs500 per return, per month, instead of Rs10000 per month, per return

GST council clears the proposal to allow small taxpayers (below Rs5cr annual turnover) to file their returns for Feb-June,2020 with 9% interest beyond 30June & at 18% Interest after 30 Sept

Latest Updates in Income Tax Return Disclosures

Income Tax New disclosures asked in the new ITR forms 1 to 7 are:

1)      House ownership: Individual taxpayers who are joint owners of house property cannot file ITR 1 or ITR4.

2)     Passport: One needs to disclose the Passport number if held by the taxpayer. This is to be furnished both in ITR 1-Sahaj and ITR 4-Sugam. Hopefully, it will be made mandatory in other ITR Forms as and when they are notified.

3)   Cash deposit: For those filing ITR 4-Sugam, it has been made compulsory to declare the amount deposited as cash in a bank account, if such amount exceeds Rs 1 crore during the FY.

4)   Foreign travel: If you have spent more than Rs 2 lakh on travelling abroad during the FY, you need to disclose the actual amount spent.

5)  Electricity consumption: If your electricity bills have been more than Rs 1 lakh in aggregate during the FY, you need to disclose the actual amount.

6)   Investment details:  Details of investment qualifying for deduction under chapter VIA with bifurcation of details of investment made during the period from April 1, 2020 to June 30, 2020.

7)    For every assessment year, the last date for filing tax returns is July 31, However, this year ITR filing date has been extended till November 30, 2020 due to pandemic Covid-19.

8)   Income Tax Exemptions and Deductions that you can claim under the New Tax Regime for FY 2020-21 (AY 2021-22): Withdrawal by an employee from the Employees' Provident Fund (EPF) is not taxable after 5 years of continuous service.

9)   Withdrawal from National Pension Scheme (NPS) on maturity or premature closure up to 40% of the amount received on such withdrawal remains tax free for all. In case of partial withdrawal from NPS, up to 25% of the contributions made by the individual will be tax free. Employer’s contribution to NPS up to 10% of their basic salary and dearness allowance also remains tax free.

10) Under Section 10 (10D) of the Income Tax Act, the sum assured and any bonus paid on maturity or surrender of the life insurance plan is tax free. Maturity proceeds continue to be exempt under Section 10(10D) even in the new regime. The maturity amount including interest received on the Sukanya Samriddhi Yojana will not attract any tax.

11) Conveyance Allowance granted to meet expenditure incurred on conveyance in performance of duties of an office and any allowance granted to an employee to meet the cost of travel on tour or on transfer (including relocation) are tax free. Interest received from post office savings account balance up to ₹3,500 annually per individual will remain free from tax.

12)  Any scholarship granted to meet education costs is tax exempt under Section 10 (16) of the Income Tax Act. Gratuity received from the employer up to ₹20 lakh after rendering 5 years of continuous service. Leave encashment received at the time of resignation or retirement up to ₹3 lakh.

13)  Form 26AS will now be a complete profile of the taxpayer w.e.f. 01.06.2020, CBDT vide Notification dated May 28, 2020 amended Form 26AS in Sec 285BB w.e.f. 01.06.2020. Key takeaways are:

14) New form 26AS will also provide information in respect of “Specified financial transactions” which include transactions of purchase/ sale of goods, property, services, works contract, investment, expenditure, taking or accepting any loan or deposits of such value as may be prescribed but not less than of Rs 50,000.    

15) Information about income tax demand, refund, proceedings pending, and proceedings completed which may include assessment, reassessment under section 148,153A 153C, revision, appeal will also be shared in this form 26AS.     

16)  Information on this form 26AS will not be a one-time affair at year end. This will be a live 26AS, as this will be updated regularly within 3 months from the end of the month in which such information is received.      

17) Form 26AS will now be a complete profile of the taxpayer for that particular year as against earlier form 26AS which just provided the information about taxes paid by way of TDS/TCS or self-assessing. This form will also have mobile no, email I’d and Aadhar no. of the taxpayer.   

18) Further an enabling provision has been notified empowering the CBDT to authorise DG Systems or any other officer to upload in this form, information received from any other officer, authority under any law. Thus any adverse action initiated or taken or found or order passed under any other law such as custom , GST , Benami Law etc. including information about Turnover , import , export etc. will also be put in this form 26AS so that not only the concerned taxpayer but  also all the Income Tax authorities will  know and have access to such information.     

19) This form 26AS will also provide information received by Tax Deptt from any other country under the treaty /exchange of information about income or assets of the taxpayer located outside India.    

20) The implication of this new form 26AS will be that banks , financial institutions or any other authority or customer , buyer etc. while carrying out due diligence of the person/ corporate concerned will now ask for form 26AS  so as to be sure that there are not any major issues about such person/corporates.  

21) This will now make difficult for any taxpayer to hide information from any bank / financial institution/ authority about any proceedings against under any law or tax demand, tax disputes etc...

Atmanibhar Bharat Abhiyan – Part –I Taxation Measures

TAXATION MEASURES:

1. Rs. 50,000 crores liquidity through TDS/TCS rate reduction

• Rates of TDS for non-salaried specified payments made to residents and rates TCS for the specified receipts shall be reduced by 25% of the existing rates.

• Payment for contract, professional fees, interest, rent, dividend, commission, brokerage, etc. shall be eligible for this reduced rate of TDS.

• This reduction shall be applicable for the remaining part of the FY 2020-21 i.e. from tomorrow to 31st March, 2021.

2. All pending refunds to charitable trusts and non- corporate businesses & professions including proprietorship, partnership, LLP and Co-operatives shall be issued immediately.

3. Due date of all income-tax return for FY 2019-20 will be extended from 31st July, 2020 & 31st October, 2020 to 30th November, 2020 and Tax audit from 30th September, 2020 to 31st October,2020.

4. Date of assessments getting barred on 30th September,2020 extended to 31st December,2020 and those getting barred on 31st March,2021 will be extended to 30th September,2021.

5. Period of Vivad se Vishwas Scheme for making payment without additional amount will be extended to 31st December,2020.

GST Invoice Series for the FY 2020-21

Important Changes in GST

HC Judgement on Transitional Provision

🏛️ *Reliance Electric Works Vs. UOI, Delhi HC*🏛️

👉🏼Hon’ble Delhi High Court has held that *period of 90 days for claiming input tax credit in TRAN-1* is directory and therefore, *period of limitation of 3 years under the Limitation Act* would apply. 

🏛️The Court has directed the Department to allow all assessees to claim input tax credit in *TRAN-1 by 30.6.2020*. 

👍The direction would apply to all those *who could not file TRAN-1 and claim input tax credit*

🏛️The court has further directed that it should be advertised that all taxpayers who have not filed TRAN 1 can do so *by 30.6.2020*.

👁️ *The judgment has been made applicable to all irrespective of whether the taxpayer has approached the court or not.*

Beware of Fake website for Refund of GST

Dear Taxpayers,

http://Onlinefilingindia.in 

Abovementioned Website when we go provides replica of GSTN site and ask for varous details. Many Tax payers are receiving messages like Due to COVID-19 Outbreak, Central Govt. Has Started Online Processing of GST Refund. Click Below to Claim Your Refund.

Abovementioned website is not linked to GSTN & it's fake.

Be aware of such fake websites.

Meetings during pandemic

Digital Board Meetings in the time of COVID-19

---

The COVID19 pandemic has drastically altered the way Companies are conducting business. The dependency on the technology has increased considerably. From the secretarial point of view things are no different and many companies are rethinking their approach towards complying with various statutes. Most of the companies had already given away the age-old practice of sending hard copies of the agenda papers and implemented paperless Board Meetings. This itself was a huge step towards digitalization of the Board Meetings. Next step is conducting meetings through Video-conference. Again this is also not a new concept for Indian companies, however this would be the first time for many companies where all the participants attend the meeting through remote locations.
The Companies Act, 2013 (Act) allows every Company to conduct meetings through video conferencing or other audio-visual means (VC) which are capable of recording and recognizing the participation of the Directors and of recording and storing the proceedings of such meetings along with date and time.
'Video conferencing or other audio-visual means' means audio- visual electronic communication facility employed which enables all the persons participating in a meeting to communicate concurrently with each other without an intermediary and to participate effectively in the meeting. Many companies have already been using VC for conducting Board Meetings for Directors who request for the same. With COVID19 pandemic and the lockdown, Video conferencing has become need of the hour.

Below are few points for conducting a Board meeting via Video Conferencing.

The following broad overview also provides some suggestions to ensure a smooth conduct of the meeting. Applicable provisions: [Sec 173(2) of the Act; Rule 3 and Rule 4 of The Companies (Meetings of Board and its Powers) Rules, 2014] Section 173(2) of the Act allows participation of directors in a meeting of the Board either in person or through VC, as may be prescribed, which are capable of recording and recognizing the participation of the directors and of recording and storing the proceedings of such meetings along with date and time. However, the proviso to section 173(2) allowed Central government to decide the items which shall not be dealt with in a meeting through VC.
Rule 4 of The Companies (Meetings of Board and its Powers) Rules, 2014 lists down the matters that cannot be dealt in any meeting through VC. Currently the list includes five such matters:
1) the approval of the annual financial statements;
2) the approval of the Board's report;
3) the approval of the prospectus;
4) the Audit Committee Meetings for consideration of financial statement including consolidated financial statement if any, to be approved by the board
5) the approval of the matter relating to amalgamation, merger, demerger, acquisition and takeover.
Further to remove the hardships caused by these exceptions, the Companies Amendment Act, 2017 which became effective from 7th May, 2018 inserted another proviso to this section stating Where there is quorum in a meeting through physical presence of directors, any other director may participate through VC in such meeting on any matter specified under the first proviso. Furthermore to conduct Board meetings during the lockdown period, Ministry of Corporate Affairs has issued Companies (Meetings of Board and its Powers) Amendment Rules, 2020 dated 19th March, 2020.
As per the amendment, For the period beginning from the commencement of these Rules and ending on the 30th June,2020, the meetings on matters referred to in sub-rule (1) may be held through VC means in accordance with rule 3.
Exception for COVID 19 lockdown: Hence for Board Meetings conducted upto 30th June, 2020, all the items including the five items in rule 4 can be conducted through Video-conferencing as per Rule 3 without any requirement of quorum through physical presence of directors. Rule 3 of The Companies (Meetings of Board and its Powers) Rules, 2014 lays down the procedure or convening and conducting the Board meetings through VC.

Some important points to be ensured for a meeting conducted through VC:

A) Notice of Board Meeting: Along with the Notice of the Board Meeting, Directors have to be informed that the VC option has been made available for the Board Meeting and seek confirmation from them if they wish to attend the meeting through VC. However since the meeting for the quarter and year end 31st March, 2020 has to be conducted through VC, it would be a good practice to inform the Directors in advance and seek their confirmations. The contact details of the person to be mentioned to whom the confirmation has to be given. The notice shall specify the venue of the meeting, and it shall be the place where all the recordings of the proceedings at the Meeting would be made. All the necessary information to enable the directors to participate through VC should be shared with the them along with the notice or separately. Necessary information includes the link to download the app, steps to do so, login id and password if required and important instructions to use the applications. Do a trial run before the meeting with more number of participants and take the test results, for any issues faced get the same clarified with an expert. While testing the application, also try presenting and sharing of the documents to facilitate the same during the Board Meeting.
B) Arrangements: Necessary arrangements to avoid failure of video or audio-visual connection. Inform all the participants in advance the bandwidth requirement, get the application downloaded few days before the meeting for smooth conduct of the Board meeting, ensure availability of proper equipment like additional speakers or camera for effective participation.
C) Safeguard Integrity: The Chairperson/Secretary shall ensure that no person other than the concerned director are attending or have access to the proceedings of the meeting conducted through VC.
D) Proper Facility: The participants attending the meeting through VC should be able to hear and see the other participants clearly during the course of the meeting. Companies are using applications like Zoom, Skype, Microsoft Teams, Vidyo Connect, Webex, GoToMeeting etc. It is important to ensure that the application helps you comply with the requirements of the Act. Hence after thorough check the right application should be chosen.
E) Recording the proceedings: The application that you have chosen should have audio/video recording facility which can be then stored for safekeeping and marking the tape recording(s) or other electronic recording mechanism as part of the records of the company at least before the time of completion of audit of that particular year.
F) Quorum: Ensure that the required quorum is present throughout the meeting.
G) Statutory registers: Registers required to be placed in the Board meeting as per the provisions of the Act shall be placed at the scheduled venue of the meeting and where such registers are required to be signed by the directors, the same shall be deemed to have been signed by the directors participating through electronic mode, if they have given their consent to this effect and it is so recorded in the minutes of the meeting.

Procedure: Roll call by the Chairperson:

• To make a roll call at the commencement of the meeting and the director's participating through electronic mode shall state the following:
• Name; Location from where he is participating;
• Confirmation the receipt of the agenda and relevant material facts of the meeting;
• Confirming that no person other than him/her is attending or have access to the proceedings of the meeting.
• A note mentioning the above details can be shared with the participants for them to better prepared at the meeting. Chairman/ Company Secretary to read out the name of the persons attending other than the Director.
• After the roll call, the Chairperson or the Company Secretary shall inform the Board about the names of persons other than the directors who are present for the said meeting at the request or with the permission of the Chairperson and confirm that the required quorum is complete.

Proceedings of the Meeting

• Every person participating the meeting over VC shall identify himself for the record before speaking on any item of business on the agenda.
• If a statement of a director in the meeting through VC is interrupted or garbled, the Chairperson or Company Secretary shall request for a repeat or reiteration by the Director.
• If a motion is objected to and there is a need to put it to vote, the Chairperson shall call the roll that is to say that he shall first announce that he shall be doing the roll call and call out the name of each director who shall identify himself while casting his vote and the Chairperson shall then note the vote of each director.
• Chairperson to summarize the decisions taken during the meeting on each item of agenda transacted along with the voting details, at the end of the meeting.
• Chairperson to make roll call at the end of the meeting and after every break.

Minutes:

• The minutes shall disclose the particulars of the directors who attended the meeting through VC.
• The draft minutes of the meeting shall be circulated among all the directors within fifteen days of the meeting either in writing or in electronic mode as may be decided by the Board.
• Every director shall confirm and give his/her comments in writing, about the accuracy of recording of the proceedings of that particular meeting in the draft minutes, within seven days or some reasonable time as decided by the Board, after receipt of the draft minutes failing which his approval shall be presumed.
• The minutes shall then be entered in the minute book as specified under section 118 of the Act and signed by the Chairperson.

Conclusion:

The procedure for conducting Board Meeting through VC is an elaborate one considering the fact that the Board discussions are highly sensitive and sanctity and integrity of the same has to be maintained. However, until now one or two members would remotely attend the meeting through VC and hence following the above-stated procedure was possible. But for now, if all the participants are joining through VC, the procedural part might become repetitive and time-consuming for instance, every person to identify himself before speaking on an agenda item or for the Chairman to take a roll call after every break might disrupt the free-flowing discussions.
Given the current situation it would be helpful if certain procedures can be relaxed. Also it is time to re-think the entire procedure and be future-ready. If the Act allows all business to be transacted through VC without requirement of the quorum, companies may conduct more such meetings in the future. Having said this the relaxation in procedure should not compromise the safety and integrity of the meetings. Hence focus has to be on good systems/applications with necessary security measures in place. The authorities can also prescribe safety standards and parameters, which can be made mandatory for the application to be allowed to be used for the Board Meetings.
This way we can make Digitalized Board Meetings a reality. The views mentioned in this article belong to the author alone and do not represent the opinions of the institutions affiliated with the authors. Any error is regretted.
For comprehensive understanding of the protocols in place it is advisable to go through the following links. http://ebook.mca.gov.in/default.aspx