Passing of resolution by circulation (Section 175 of the Companies Act, 2013) :
Section 175 of the Companies Act, 2013 which came into force from 1st April, 2014, provides for Passing of resolution by circulation. According to this section:
(i) The Act allows the Board of directors to pass resolution by Circulation also. No resolution shall be deemed to have been duly passed by the Board or by a committee thereof by circulation unless:
(a) The resolution has been circulated in draft, together with the necessary papers, if any, to all the directors, or members of the committee, as the case may be,
(b) at their addresses registered with the company in India,
(c) by hand delivery or by post or by courier, or through such electronic means as may be prescribed, and
(d) and has been approved by a majority of the directors or members, who are entitled to vote on the resolution.
Rule 5 of the Companies (Meetings of Board and its Powers) Rules, 2014 provides that a resolution in draft form may be circulated to the directors together with the necessary papers for seeking their approval, by electronic means which may include E-mail or fax. If at least 1/3rd of the total number of directors of the company for the time being require that any resolution under circulation must be decided at a meeting, the chairperson shall put the resolution to be decided at a meeting of the Board (instead of being decided by circulation).
(ii) A resolution that has been passed by circulation shall have to be necessarily be noted in the next meeting of board or the committee, as the case may be, and made part of the minutes of such meeting.