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CS Professional · Compliance Management, Audit and Due Diligence · Legal Framework Governing Company Secretaries

A member of the Council argues that the Council may fix, by its own resolution, the functions and conditions of working of the Finance Committee and any other committee formed under section 17. What is the correct position under the Act?

The argument is incorrect. Section 17(8) provides that the Standing Committees and other committees formed under the section exercise such functions, and are subject to such conditions, as may be prescribed. This applies to Standing and optional committees alike, not at the Council's unrestricted discretion.

  1. ACorrect; the Council has unrestricted discretion over committee functions
  2. BIncorrect; committee functions are exercised subject to such conditions as may be prescribedCorrect
  3. CCorrect for optional committees only, not for Standing Committees
  4. DIncorrect; committees have no functions and merely advise the President

Explanation

Section 17(8) says the Standing Committees and other committees formed under the section exercise such functions and are subject to such conditions as may be prescribed. The functions are therefore prescribed, not left to the Council's resolution, and the rule covers both Standing and other committees.

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