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CS Professional · Compliance Management, Audit and Due Diligence · Documentation and Maintenance of Records

Bharat Textiles Ltd keeps its register of members, minutes and other statutory records on a secure company server instead of in bound books. The Company Secretary asks whether this is permissible under the Companies Act, 2013. Which statement is correct?

Electronic maintenance is permitted. Section 120 of the Companies Act, 2013 lets a company keep any required document, record, register or minutes, and allow their inspection or copying, in electronic form, provided the prescribed form and manner is followed. No Registrar approval or parallel paper set is required by that section.

  1. AIt is permissible only if every record is also kept in physical form at the registered office
  2. BIt is permissible; any document, record, register or minutes required to be kept by a company may be kept in electronic form in the prescribed form and mannerCorrect
  3. CIt is permissible only for minutes and not for registers
  4. DIt is not permissible unless the Registrar gives written approval for each record

Explanation

Section 120 allows any document, record, register, minutes etc. required to be kept by a company, or allowed to be inspected or copied, to be kept in electronic form in such form and manner as may be prescribed. It is not limited to minutes, and no Registrar approval or parallel physical copy is stated in the section. The prescribed form and manner must still be followed.

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