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CS Executive · Company Law and Practice · Meetings of Board and its Committees

During a Board meeting of Kaveri Pharma Ltd, a director made a remark about a supplier which the Chairman considers defamatory. Which statement is correct under section 118?

The Chairman may leave it out. Under section 118(5) and (6), matter the Chairman regards as defamatory, irrelevant or immaterial, or detrimental to the company's interests is not to be included, and the Chairman has absolute discretion on these grounds without needing Board or Registrar approval.

  1. AThe Chairman must include it, as minutes must be a verbatim record
  2. BThe Chairman may exclude it, exercising absolute discretion on the specified groundsCorrect
  3. CIt can be excluded only with the Board's resolution
  4. DIt can be excluded only with the Registrar's permission

Explanation

Section 118(5) bars inclusion of matter which in the Chairman's opinion is defamatory, irrelevant or immaterial, or detrimental to the company's interests. Section 118(6) gives the Chairman absolute discretion on these grounds, so no Board resolution or Registrar approval is needed.

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